Bill Text: MI HB4770 | 2015-2016 | 98th Legislature | Introduced
Bill Title: Local government; other; regional water and sewer alliance; create. Creates new act. TIE BAR WITH: HB 4771'15
Spectrum: Slight Partisan Bill (Republican 2-1)
Status: (Introduced - Dead) 2015-07-15 - Printed Bill Filed 07/15/2015 [HB4770 Detail]
Download: Michigan-2015-HB4770-Introduced.html
HOUSE BILL No. 4770
July 14, 2015, Introduced by Reps. Heise, Liberati and Howrylak and referred to the Committee on Local Government.
A bill to provide for the establishment of a regional water
and sewer alliance; to provide for a board of trustees; to provide
for transfer of certain rights in water supply and sewerage
facilities; to provide for payment for water supply and sewerage
services and facilities through rates, charges, special
assessments, and other means; to provide for the issuance and
payment of bonds or other obligations; and to provide for the
powers and duties of certain governmental officials and entities.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. This act shall be known and may be cited as the
"regional water and sewer alliance act".
Sec. 2. As used in this act:
(a) "Acquire" means acquisition by purchase, construction, or
any other method.
(b) "Alliance" means a regional water and sewer alliance
created by this act.
(c) "Board of trustees" or "board" means the governing body of
an alliance.
(d) "Local unit of government" means a county, city, village,
township, charter township, drainage district, or authority
existing under the laws of this state.
(e) "Metropolitan area" means the service area of a regional
system.
(f) "Municipal sewage collection system" means a sewerage
system located within or outside the corporate limits of a local
unit of government that collects sewage or combined sewage directly
from the users of that system and transports that sewage to a
regional system or another wastewater treatment facility for
disposal.
(g) "Municipal water distribution system" means a water supply
system located within or outside the corporate limits of a local
unit of government that receives water from a regional system or
another water source and distributes water directly to the users or
ratepayers of that system.
(h) "Regional system" means interconnected water supply and
sewerage services and facilities that provide water supply service
or sewerage service, or both, for more than 20% of the population
of this state. A regional system may consist of water supply
facilities and services that serve 1 group of customers and users
and a system of sewerage facilities and services that serves a
different group of customers and users.
Sec. 3. Each regional system shall be incorporated as a
regional water and sewer alliance under this act. An alliance
created under this act has the power to do the following:
(a) To exercise exclusive jurisdiction, control, and
supervision of a regional system and other water supply or sewage
disposal systems placed under its jurisdiction.
(b) To maintain, operate, reconstruct, improve, or
decommission a regional system and other water distribution or
sewage disposal systems under its jurisdiction and make additions,
betterments, and extensions to those systems to monitor and protect
the public health and welfare by preventing or abating the
pollution of water.
(c) To prepare, revise, and adopt plans, designs, and
estimates of costs of a system of outfalls, sewers, trunks, water
mains, submains, interceptors, lateral sewers, outlets for
sewerage, storm water drains, pump stations, ventilating stations,
water and wastewater treatment plants and works, and all other
structures, systems, and works which provide an effective and
advantageous means for insuring the area within the alliance of
safe drinking water and adequate sanitary sewage treatment.
(d) To construct any additions, improvements, or extensions to
the facilities of the alliance, including across, through, over, or
under any public highway, railroad right-of-way, tract, grade, fill
or cut, and any other right-of-way or easement in the alliance and
remove any fence, building, or other improvement in the alliance
where necessary for the construction of the additions,
improvements, or extensions.
(e) To establish, own, acquire, construct, lease, operate, and
maintain, as a part of the systems of the alliance, water treatment
facilities, sewage treatment and disposal plants, and all
appurtenances and appliances belonging to them and sell any product
or by-product manufactured in the course of water or wastewater
treatment.
(f) To own, acquire, and hold personal property considered
necessary to carry out the corporate purposes of the alliance and
dispose of personal property when the alliance has no further need
of it.
(g) To own, hold, control, and acquire by donation, purchase,
contract, lease, or the exercise of the power of eminent domain all
rights of property, either public or private, necessary for the
purposes of the alliance. In exercising the power of eminent
domain, an alliance shall follow the procedures set forth in the
uniform condemnation procedures act, 1980 PA 87, MCL 213.51 to
213.75. An alliance may sell and convey property no longer
necessary or useful in its operations.
(h) To contract with state or federal governments or their
agencies, local units of government, drainage districts, other
public agencies, individuals, or private corporations for the
construction, use, or maintenance of common or joint sewers, common
or joint water lines, drains, outlets, or water treatment and
wastewater disposal plants or for any service required by the
alliance.
(i) To contract with and permit municipalities, districts,
other public agencies, individuals, or private corporations to
contract for the purpose of connecting with and using the
facilities of the alliance.
(j) To apply for and accept grants, loans, or contributions
from the federal government, its agencies, this state, or other
public or private agencies for the purposes of this act and do all
things within its powers necessary or desirable to secure the aid
or cooperation.
(k) To incur debts by borrowing money in anticipation of the
collection of revenues and to give appropriate evidence of those
loans.
(l) To meet the cost of acquiring, constructing, improving, or
extending all or any part of the water and sewage disposal systems
operated by the alliance by any of the following:
(i) The expenditure of funds available for that purpose.
(ii) The issuance of bonds for that purpose, payable from fees
or special assessments collected by the alliance.
(iii) The proceeds of special assessments.
(iv) Any other funds which may be obtained under the laws of
this state or of the United States for that purpose.
(v) The proceeds of revenue bonds, payable from the revenues
to be derived from the operation of water supply systems and sewage
disposal systems of the alliance.
(vi) Any combination of these methods of providing funds.
(m) To prescribe the manner and time at which the rates and
charges authorized by the public service commission under 1939 PA
3, MCL 460.1 to 460.11, are to be paid, and to collect or enforce
collection of those charges.
(n) To contract with a local unit of government, public
agency, or private water company for service contracts, joint use
contracts, or contracts for the construction or operation of any
part of the water supply systems or sewage disposal systems or for
the collection of rates or other charges levied by the alliance for
water supply and sewage disposal services. The local unit of
government, public agency, or private water company may contract to
collect the rates or other charges and to discontinue water
services or sewage collection services upon failure to pay the
rates or charges within the time prescribed by ordinance.
(o) To enter lands, waters, and premises for the purposes of
making surveys, evaluations, and examinations.
(p) To approve, revise, or reject the plans and designs of all
outfalls, sewers, trunks, water mains, submains, interceptors,
lateral sewers, outlets for sewerage, storm water drains, pump
stations, ventilating stations, water and wastewater treatment
plants and works, and all other structures, systems, and works
proposed to be constructed, altered, or reconstructed by any other
person or corporation, private or public, in the alliance. Any work
shall be subject to inspection and supervision of the alliance.
(q) To fix, levy, and collect special assessments, in the form
of supplemental rates, for the construction, improvement, or
extension of water, sewer, or drainage facilities, levied ratably
by area upon lots or parcels of ground within the alliance, whether
public or private, benefited by the construction, improvement, or
extension and provide by ordinance for the classification and
reclassification of these properties into classes or subclasses
that the board determines are fair and reasonable.
(r) To provide a retirement system for employees of the
alliance if and when permissible under the constitution and laws of
this state.
(s) To bargain collectively and enter into agreements with
labor organizations. An alliance shall be bound by existing labor
union agreements with publicly or privately owned water supply
systems or sewage disposal systems that are acquired, purchased, or
condemned by the alliance.
(t) To require the owner of any real property capable of being
efficiently served by water supply or sewage disposal systems
operated by the alliance to connect with and use the facilities if
the board finds that the water supply or sewage collection from
that property constitutes a public nuisance or a danger to public
health or safety.
Sec. 4. (1) An alliance shall be governed by a 9-member board
of directors whose members are appointed for a term of 4 years as
follows:
(a) Two board members appointed by the mayor of the city with
the largest population served by the regional system.
(b) One board member appointed by the city council of the city
with the largest population served by the regional system.
(c) One board member appointed by the governor.
(d) Two board members appointed by the governor. The board
members appointed under this subdivision shall be local elected
officials from 2 of the local units of government served by the
regional system, but not local elected officials from the city with
the largest population served by the regional system.
(e) Each county executive or chief executive officer from a
county with 1 of the 3 largest populations served by the regional
system shall appoint 1 board member.
(2) A majority of the members of the board constitute a quorum
for the transaction of business. Each member of the board shall
have 1 vote.
(3) The first meeting of the board shall be held not more than
120 days after the effective date of this act. After its first
meeting, the board shall meet not less than every 30 days and at
other times determined by the board.
Sec. 5. A local unit of government, sewer district, or public
agency situated within a metropolitan area shall retain its
municipal water distribution system and municipal sewage collection
system together with all contracts, rights, privileges, interests,
easements, books, maps, plans, papers, records, and title to them.
A local unit of government, sewer district, or public agency may,
under a separate contract or transfer of ownership, transfer
administration, control, and supervision of a municipal water
distribution system or a municipal sewage collection system to an
alliance. An alliance shall not assume, agree to pay, or be liable
for any bonded indebtedness of a local unit of government, sewer
district, or other public agency unless ownership of the system is
transferred.
Sec. 6. (1) In order to assure continuity of operation and
maintenance, a local unit of government, sewer district, or other
public agency shall continue to maintain and operate the municipal
water distribution system and sewage collection system until
January 1, 2018, when the alliance shall exclusively maintain,
operate, and control the systems and facilities.
(2) An alliance shall administer, control, and supervise the
regional system. A local unit of government that owns a regional
system shall retain ownership of its portion of the regional system
and all rights, privileges, interests, easements, books, maps,
plans, papers, records, and title to them. A local unit of
government that owns a regional system shall assign all contracts
for water supply and sewage disposal and treatment to the alliance.
A local unit of government that owns a regional system may transfer
ownership of the regional system to the alliance. In order to
assure continuity of operation and maintenance, a local unit of
government that owns a regional system shall continue to maintain
and operate the regional system until January 1, 2018, when the
alliance shall administer, control, and supervise the system.
Sec. 7. The public service commission shall, as provided in
1939 PA 3, MCL 460.1 to 460.11, authorize rates and other charges
for services and use of the water supply systems or sewage disposal
systems owned or operated within the jurisdiction of the alliance.
An alliance shall determine, after appropriate public hearing, the
water supply systems and sewage disposal systems to be operated by
it and the services to be available to the public.
Sec. 8. An alliance may not levy taxes or pledge the credit or
taxing power of this state or a local unit of government, except
for the pledging of receipts of taxes collected by this state or a
local unit of government and returnable or payable by law or by
contract to the alliance and except for the pledge by a local unit
of government of its full faith and credit in support of its
contractual obligations to the alliance as authorized by law. A
regional system and any municipal water supply or municipal sewage
disposal system which the alliance has agreed to control,
supervise, administer, operate, and maintain shall be financed, in
addition to other methods of financing provided by law, by any of
the following:
(a) Rates and charges.
(b) Income or revenues from whatever source available,
including appropriations or contributions of whatever nature or
other revenues of the participating local units of government.
(c) Grants, loans, or contributions from federal, state, or
local units of government and grants, contributions, gifts,
devises, or bequests from public or private sources.
(d) Proceeds of taxes, special assessments, or charges imposed
pursuant to law and collected by this state or a local unit of
government.
Sec. 9. (1) An alliance may borrow money and issue bonds to
finance and carry out its powers and duties. The bonds shall be
payable from and may be issued in anticipation of payment of the
proceeds of any of the methods of financing described in section 8
or elsewhere in this act or as provided by law.
(2) A local unit of government within the geographical
boundaries of the alliance may contract to make payments,
appropriations, or contributions to the alliance of the proceeds of
taxes, special assessments, or charges imposed and collected by the
local unit of government or out of other funds legally available
and may pledge its full faith and credit in support of its
contractual obligation to the alliance. The contractual obligation
shall not constitute an indebtedness of a local unit of government
within a statutory or charter debt limitation. If the alliance has
issued bonds in anticipation of payments, appropriations, or
contributions to be made to the alliance pursuant to contract by a
local unit of government having the power to levy and collect ad
valorem taxes, the local unit of government may obligate itself by
the contract and may levy a tax on all taxable property in the
local unit of government to provide sufficient money to fulfill its
contractual obligation to the alliance. The tax rate or amount
shall be as provided in section 6 of article IX of the state
constitution of 1963 for contract obligations in anticipation of
which bonds are issued.
(3) The bonds of the alliance shall be issued and sold in
compliance with the revised municipal finance act, 2001 PA 34, MCL
141.2101 to 141.2821, except that the bonds may be issued for a
period not exceeding 50 years.
(4) A local unit of government may advance money or deliver
property to an alliance to finance or carry out the alliance's
powers and duties. The alliance may agree to repay the advances or
pay for the property within a period not exceeding 10 years, from
the proceeds of its bonds or from other funds legally available for
that purpose, with or without interest as agreed at the time of
advance or of repayment. The obligation of the alliance to make the
repayment or payment may be evidenced by a contract or note, which
may pledge the full faith and credit of the alliance.
(5) An alliance may advance money or deliver property to a
local unit of government to finance or to carry out the local unit
of government's powers and duties. The local unit of government may
agree to repay the advances or pay for the property within a period
not exceeding 10 years from the proceeds of its bonds or from other
funds legally available for that purpose, with or without interest
as agreed at the time of advance or of repayment. The obligation of
the local unit of government to make the repayment or payment may
be evidenced by a contract or note, which may pledge the full faith
and credit of the local unit of government.
(6) Notes issued and contracts entered into under this section
are not subject to the revised municipal finance act, 2001 PA 34,
MCL 141.2101 to 141.2821.
Sec. 10. This act, being necessary for the public peace,
health, safety, and welfare, shall be liberally construed to effect
the purposes hereof, which are declared to be public purposes.
Sec. 11. The alliance and its property, real, personal, and
mixed, are exempt from fees and the assessment, levy, and
collection of all general and special taxes of this state or a
local unit of government.
Sec. 12. Records and any other writings prepared, owned, used,
in the possession of, or retained by the alliance in the
performance of an official function shall be available to the
public during normal business hours in compliance with the freedom
of information act, 1976 PA 442, MCL 15.231 to 15.246. The business
which the board may perform shall be conducted at a public meeting
of the board held in compliance with the open meetings act, 1976 PA
267, MCL 15.261 to 15.275. Public notice of the time, date, and
place of the meeting shall be given in the manner required by the
open meetings act, 1976 PA 267, MCL 15.261 to 15.275.
Sec. 13. Pursuant to section 27 of article VII of the state
constitution of 1963 and any other applicable law, an alliance
created under this act is an agency and instrumentality of the
state that has all of the powers of a public corporation in the
exercising of its duties under this act. The enumeration of any
powers in this act shall not be construed as a limitation upon
those general powers.
Sec. 14. A challenge to the validity of any provision of this
act shall be filed with and decided by the court of appeals
pursuant to section 10 of article VI of the state constitution of
1963.
Enacting section 1. This act takes effect 90 days after the
date it is enacted into law.
Enacting section 2. This act does not take effect unless
Senate Bill No.____ or House Bill No. 4771 (request no. 03273'15) of
the 98th Legislature is enacted into law.
