Bill Text: MI HB4967 | 2009-2010 | 95th Legislature | Introduced
Bill Title: Economic development; tax increment financing; transportation investment zone for transit and transportation projects; provide for. Creates new act.
Spectrum: Partisan Bill (Democrat 7-0)
Status: (Introduced - Dead) 2009-05-20 - Printed Bill Filed 05/20/2009 [HB4967 Detail]
Download: Michigan-2009-HB4967-Introduced.html
HOUSE BILL No. 4967
May 19, 2009, Introduced by Reps. Kandrevas, Donigan, Bauer, Gonzales, Polidori, Byrnes and Dean and referred to the Committee on Transportation.
A bill to provide for the establishment of a transit
investment zone tax increment finance authority; to prescribe the
powers and duties of the authority; to authorize the acquisition
and disposal of interests in real and personal property; to
authorize the creation and implementation of development plans and
development areas; to promote improvement in areas where transit
projects are to be implemented; to create a board; to prescribe the
powers and duties of the board; to authorize the issuance of bonds
and other evidences of indebtedness; to authorize the use of tax
increment financing; to prescribe powers and duties of certain
state officials; to provide for rule promulgation; and to provide
for enforcement of the act.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. This act shall be known and may be cited as the
"transit investment zone act".
Sec. 2. As used in this act:
(a) "Advance" means a transfer of funds made by a municipality
to an authority or to another person on behalf of the authority in
anticipation of repayment by the authority. Evidence of the intent
to repay an advance may include, but is not limited to, an executed
agreement to repay, provisions contained in a tax increment
financing plan approved prior to the advance, or a resolution of
the authority or the municipality.
(b) "Assessed value" means the taxable value as determined
under section 27a of the general property tax act, 1893 PA 206, MCL
211.27a.
(c) "Authority" means a transit investment authority created
under this act.
(d) "Board" means the governing body of an authority.
(e) "Captured assessed value" means the amount in any 1 year
by which the current assessed value of the development area,
including the assessed value of property for which specific local
taxes are paid in lieu of property taxes, exceeds the initial
assessed value. The state tax commission shall prescribe the method
for calculating captured assessed value.
(f) "Chief executive officer" means the mayor or city manager
of a city, the president or village manager of a village, or the
supervisor of a township.
(g) "Fiscal year" means the fiscal year of the authority.
(h) "Governing body" or "governing body of a municipality"
means the elected body of a municipality having legislative powers.
(i) "Initial assessed value" means the assessed value of all
the taxable property within the boundaries of the development area
at the time the ordinance establishing the tax increment financing
plan is approved, as shown by the most recent assessment roll of
the municipality at the time the resolution is adopted. Property
exempt from taxation at the time of the determination of the
initial assessed value shall be included as zero. For the purpose
of determining initial assessed value, property for which a
specific local tax is paid in lieu of a property tax shall not be
considered to be property that is exempt from taxation.
(j) "Land use plan" means a plan prepared under former 1921 PA
207, or a site plan under the Michigan zoning enabling act, 2006 PA
110, MCL 125.3101 to 125.3702.
(k) "Municipality" means a city, village, or township.
Sec. 3. As used in this act:
(a) "Operations" means office maintenance, including salaries
and expenses of employees, office supplies, consultation fees,
design costs, and other expenses incurred in the daily management
of the authority and planning of its activities.
(b) "Parcel" means an identifiable unit of land that is
treated as separate for valuation or zoning purposes.
(c) "Public facility" means a street, and any improvements to
a street, including street furniture and beautification, park,
parking facility, recreational facility, right of way, structure,
waterway, bridge, lake, pond, canal, utility line or pipe, rails,
tracks, railway system, public transportation system, or building,
including access routes designed and dedicated to use by the public
generally, or used by a public agency, that is related to
development concentrated around and oriented to transit stations in
a manner that promotes transit ridership or passenger rail use.
Public facility includes an improvement to a facility used by the
public or a public facility as those terms are defined in section 1
of 1966 PA 1, MCL 125.1351, if the improvement complies with the
barrier free design requirements of the state construction code
promulgated under the Stille-DeRossett-Hale single state
construction code act, 1972 PA 230, MCL 125.1501 to 125.1531.
(d) "Public transportation agency" means a governmental entity
that operates or is authorized to operate intercity or local
commuter passenger rail service in this state or a public transit
authority created under 1 of the following acts:
(i) The metropolitan transportation authorities act of 1967,
1967 PA 204, MCL 124.401 to 124.426.
(ii) The public transportation authorities act, 1986 PA 196,
MCL 124.451 to 124.479.
(iii) 1963 PA 55, MCL 124.351 to 124.359.
(iv) The home rule city act, 1909 PA 279, MCL 117.1 to 117.38.
(v) The revenue bond act of 1933, 1933 PA 94, MCL 141.101 to
141.140.
(vi) The charter township act, 1947 PA 359, MCL 42.1 to 42.34.
(vii) The urban cooperation act of 1967, 1967 (Ex Sess) PA 7,
MCL 124.501 to 124.512.
(e) "Specific local tax" means a tax levied under 1974 PA 198,
MCL 207.551 to 207.572, the commercial redevelopment act, 1978 PA
255, MCL 207.651 to 207.668, the technology park development act,
1984 PA 385, MCL 207.701 to 207.718, or 1953 PA 189, MCL 211.181 to
211.182. The initial assessed value or current assessed value of
property subject to a specific local tax shall be the quotient of
the specific local tax paid divided by the ad valorem millage rate.
The state tax commission shall prescribe the method for calculating
the initial assessed value and current assessed value of property
for which a specific local tax was paid in lieu of a property tax.
(f) "State fiscal year" means the annual period commencing
October 1 of each year.
(g) "Tax increment revenues" means the amount of ad valorem
property taxes and specific local taxes attributable to the
application of the levy of all taxing jurisdictions upon the
captured assessed value of real and personal property in the
development area. Tax increment revenues do not include any of the
following:
(i) Taxes under the state education tax act, 1993 PA 331, MCL
211.901 to 211.906.
(ii) Taxes levied by local or intermediate school districts.
(iii) Ad valorem property taxes attributable either to a portion
of the captured assessed value shared with taxing jurisdictions
within the jurisdictional area of the authority or to a portion of
value of property that may be excluded from captured assessed value
or specific local taxes attributable to the ad valorem property
taxes.
(iv) Ad valorem property taxes excluded by the tax increment
financing plan of the authority from the determination of the
amount of tax increment revenues to be transmitted to the authority
or specific local taxes attributable to the ad valorem property
taxes.
(v) Ad valorem property taxes exempted from capture under
section 16 or specific local taxes attributable to the ad valorem
property taxes.
(vi) Ad valorem property taxes specifically levied for the
payment of principal and interest of obligations approved by the
electors or obligations pledging the unlimited taxing power of the
local governmental unit or specific taxes attributable to those ad
valorem property taxes.
(vii) Ad valorem taxes captured on property in a zone by any of
the following authorities if the taxes were captured on the date
that the property became subject to a tax increment financing plan
under this section by any of the following authorities:
(A) A downtown development authority created under 1975 PA
197, MCL 125.1651 to 125.1681.
(B) A water resource improvement tax increment finance
authority created under the water resource tax increment finance
authority act, 2008 PA 94, MCL 125.1771 to 125.1794.
(C) A tax increment finance authority under the tax increment
finance authority act, 1980 PA 450, MCL 125.1801 to 125.1830.
(D) A local development finance authority created under the
local development financing act, 1986 PA 281, MCL 125.2151 to
125.2174.
(E) A brownfield redevelopment finance authority created under
the brownfield redevelopment financing act, 1996 PA 381, MCL
125.2651 to 125.2672.
(F) A historical neighborhood tax increment finance authority
created under the historical neighborhood tax increment finance
authority act, 2004 PA 530, MCL 125.2841 to 125.2866.
(G) A corridor improvement authority created under the
corridor improvement authority act, 2005 PA 280, MCL 125.2871 to
125.2899.
(H) A neighborhood improvement authority created under the
neighborhood improvement authority act, 2007 PA 61, MCL 125.2911 to
125.2932.
(h) "Transit-oriented development" means development that is
concentrated around and oriented to transit stations in a manner
that promotes transit ridership or passenger rail use. Transit-
oriented development includes, but is not limited to, single
projects and collections of projects, including mixed use projects
on a neighborhood scale.
(i) "Zone" means a transit investment zone created in
accordance with this act.
Sec. 4. (1) Except as otherwise provided in this subsection, a
municipality may establish multiple authorities. A parcel of
property shall not be included in more than 1 authority created
under this act.
(2) An authority is a public body corporate that may sue and
be sued in any court of this state. An authority possesses all the
powers necessary to carry out its purpose. The enumeration of a
power in this act shall not be construed as a limitation upon the
general powers of an authority.
Sec. 5. (1) If the governing body of a municipality or a
public transportation agency determines that it is necessary for
the best interests of the public to promote development or promote
greater public transportation options in a transit investment zone,
the governing body may, by resolution, declare its intention to
create and provide for the operation of an authority within the
boundaries of a zone.
(2) In the resolution of intent, the governing body shall set
a date for a public hearing on the adoption of a proposed ordinance
creating the authority and designating the boundaries of the zone.
Notice of the public hearing shall be published twice in a
newspaper of general circulation in the municipality, not less than
20 or more than 40 days before the date of the hearing. Not less
than 20 days before the hearing, the governing body proposing to
create the authority shall also mail notice of the hearing to the
property taxpayers of record in the proposed zone and to the
governing body of each taxing jurisdiction levying taxes that would
be subject to capture if the authority is established and a tax
increment financing plan is approved. Failure of a property
taxpayer to receive the notice does not invalidate these
proceedings. Notice of the hearing shall be posted in at least 20
conspicuous and public places in the proposed zone not less than 20
days before the hearing. The notice shall state the date, time, and
place of the hearing and shall describe the boundaries of the
proposed zone. The zone shall consist of parcels that are not
greater than 1/2 mile in distance from a transit station. A
citizen, taxpayer, or property owner of the municipality or an
official from a taxing jurisdiction with millage that would be
subject to capture has the right to be heard in regard to the
establishment of the authority and the boundaries of the proposed
zone. The governing body of the municipality shall not incorporate
land into the zone not included in the description contained in the
notice of public hearing, but it may eliminate described lands from
the development area in the final determination of the boundaries.
(3) Not less than 60 days after the public hearing, if the
governing body of the municipality intends to proceed with the
establishment of the authority it shall adopt, by majority vote of
its members, an ordinance establishing the authority and
designating the boundaries of the zone within which the authority
shall exercise its powers. The adoption of the ordinance is subject
to any applicable statutory or charter provisions in respect to the
approval or disapproval by the chief executive or other officer of
the municipality and the adoption of an ordinance over his or her
veto. This ordinance shall be filed with the secretary of state
promptly after its adoption and shall be published at least once in
a newspaper of general circulation in the municipality.
(4) The governing body of the municipality may alter or amend
the boundaries of the zone to include or exclude lands from the
zone in the same manner as adopting the ordinance creating the
authority.
(5) A municipality that has created an authority may enter
into an agreement with an adjoining municipality that has created
an authority to jointly operate and administer those authorities
under an interlocal agreement under the urban cooperation act of
1967, 1967 (Ex Sess) PA 7, MCL 124.501 to 124.512.
Sec. 6. The authority shall consult with affected
municipalities, counties, public transportation agencies, private
transportation providers, and any other entity that the authority
considers necessary to designate a zone. The authority may conduct
a planning study and may designate a zone in advance of
implementation of a public transit service associated with a zone.
The authority shall enter into an agreement with the affected
municipalities and public transportation agencies to create a zone.
The authority shall give the local public transportation agency
that primarily services the municipality the zone is located in the
right of the first refusal. The agreement shall indicate the
geographic boundaries of the zone, shall define the activities
implemented to enhance development in the zone, and shall include
specific actions taken by the parties, including financial
participation, to help establish the zone. In addition to the
elements described in this section, the authority may utilize any
of the resources and powers it has under this act.
Sec. 7. If a zone is part of an area annexed to or
consolidated with another municipality, the authority managing that
zone shall become an authority of the annexing or consolidated
municipality. Obligations of that authority incurred under a
development or tax increment plan, agreements related to a
development or tax increment plan, and bonds issued under this act
shall remain in effect following the annexation or consolidation.
Sec. 8. (1) An authority shall be under the supervision and
control of a board consisting of the chief executive officer of the
municipality or his or her designee and not less than 5 or more
than 9 members as determined by nomination and selected from the
nominees by the governing body of the municipality. Members shall
be appointed by the chief executive officer of the municipality,
subject to approval by the governing body of the municipality. Not
less than a majority of the members shall be persons having an
ownership or business interest in property located in the zone. At
least 1/3 of the total members shall be selected from nominations
made by public transportation agencies. At least 1 member shall be
nominated by the public transportation agency that primarily
services the municipality. At least 1 of the members shall be a
resident of the zone or of an area within 1/2 mile of any part of
the zone. Of the members first appointed, an equal number of the
members, as near as is practicable, shall be appointed for 1 year,
2 years, 3 years, and 4 years. A member shall hold office until the
member's successor is appointed. After the initial appointment,
each member shall serve for a term of 4 years. An appointment to
fill a vacancy shall be made by the chief executive officer of the
municipality for the unexpired term only. Members of the board
shall serve without compensation, but shall be reimbursed for
actual and necessary expenses. The chairperson of the board shall
be elected by the board.
(2) Before assuming the duties of office, a member shall
qualify by taking and subscribing to the constitutional oath of
office.
(3) The proceedings and rules of the board are subject to the
open meetings act, 1976 PA 267, MCL 15.261 to 15.275. The board
shall adopt rules governing its procedure and the holding of
regular meetings, subject to the approval of the governing body.
Special meetings may be held if called in the manner provided in
the rules of the board.
(4) After having been given notice and an opportunity to be
heard, a member of the board may be removed for cause by the
governing body.
(5) All expense items of the authority shall be publicized
monthly and the financial records shall always be open to the
public.
(6) A writing prepared, owned, used, in the possession of, or
retained by the board in the performance of an official function is
subject to the freedom of information act, 1976 PA 442, MCL 15.231
to 15.246.
Sec. 9. (1) The board may employ and fix the compensation of a
director, subject to the approval of the governing body of the
municipality. The director shall serve at the pleasure of the
board. A member of the board is not eligible to hold the position
of director. Before beginning his or her duties, the director shall
take and subscribe to the constitutional oath, and furnish bond, by
posting a bond in the sum determined in the ordinance establishing
the authority payable to the authority for use and benefit of the
authority, approved by the board, and filed with the municipal
clerk. The premium on the bond shall be considered an operating
expense of the authority, payable from funds available to the
authority for expenses of operation. The director shall be the
chief executive officer of the authority. Subject to the approval
of the board, the director shall supervise and be responsible for
the preparation of plans and the performance of the functions of
the authority in the manner authorized by this act. The director
shall attend the meetings of the board and shall provide to the
board and to the governing body of the municipality a regular
report covering the activities and financial condition of the
authority. If the director is absent or disabled, the board may
designate a qualified person as acting director to perform the
duties of the office. Before beginning his or her duties, the
acting director shall take and subscribe to the oath, and furnish
bond, as required of the director. The director shall furnish the
board with information or reports governing the operation of the
authority as the board requires.
(2) The board may employ and fix the compensation of a
treasurer, who shall keep the financial records of the authority
and who, together with the director, shall approve all vouchers for
the expenditure of funds of the authority. The treasurer shall
perform all duties delegated to him or her by the board and shall
furnish bond in an amount prescribed by the board.
(3) The board may employ and fix the compensation of a
secretary, who shall maintain custody of the official seal and of
records, books, documents, or other papers not required to be
maintained by the treasurer. The secretary shall attend meetings of
the board and keep a record of its proceedings and shall perform
other duties delegated by the board.
(4) The board may retain legal counsel to advise the board in
the proper performance of its duties. The legal counsel shall
represent the authority in actions brought by or against the
authority.
(5) The board may employ other personnel considered necessary
by the board.
Sec. 10. The employees of an authority shall be eligible to
participate in municipal retirement and insurance programs of the
municipality as if they were civil service employees except that
the employees of an authority are not civil service employees.
Sec. 11. The board may do any of the following:
(a) Plan and propose the construction, renovation, repair,
remodeling, rehabilitation, restoration, preservation, or
reconstruction of a public facility that may be necessary or
appropriate to the execution of a plan that, in the opinion of the
board, aids in the establishment of a zone. The board is encouraged
to develop a plan that conserves the natural features, reduces
impervious surfaces, and uses landscaping and natural features to
reflect the predevelopment site.
(b) Plan, propose, and implement an improvement to a public
facility within the zone to comply with the barrier free design
requirements of the state construction code promulgated under the
Stille-DeRossett-Hale single state construction code act, 1972 PA
230, MCL 125.1501 to 125.1531.
(c) Develop long-range plans for zones within the district.
(d) Implement any plan of development for transit
revitalization in the development area necessary to achieve the
purposes of this act in accordance with the powers of the authority
granted by this act.
(e) Make and enter into contracts necessary or incidental to
the exercise of its powers and the performance of its duties.
(f) Acquire by purchase or otherwise, on terms and conditions
and in a manner the authority considers proper or own, convey, or
otherwise dispose of, or lease as lessor or lessee, land and other
property, real or personal, or rights or interests in the property,
that the authority determines is reasonably necessary to achieve
the purposes of this act, and to grant or acquire licenses,
easements, and options.
(g) Improve land and construct, reconstruct, rehabilitate,
restore and preserve, equip, clear, improve, maintain, and repair
any public facility, building, and any necessary or desirable
appurtenances to those buildings, as determined by the authority to
be reasonably necessary to achieve the purposes of this act, within
the zone for the use, in whole or in part, of any public or private
person or corporation, or a combination thereof.
(h) Fix, charge, and collect fees, rents, and charges for the
use of any facility, building, or property under its control or any
part of the facility, building, or property, and pledge the fees,
rents, and charges for the payment of revenue bonds issued by the
authority.
(i) Lease, in whole or in part, any facility, building, or
property under its control.
(j) Accept grants and donations of property, labor, or other
things of value from a public or private source.
(k) Acquire and construct public facilities.
(l) Authorize expenditure of tax increment revenues obtained
under this act for the operating costs of a public transportation
agency servicing the zone.
Sec. 12. The authority is an instrumentality of a political
subdivision for purposes of 1972 PA 227, MCL 213.321 to 213.332.
Sec. 13. (1) The activities of the authority shall be financed
from 1 or more of the following sources:
(a) Donations to the authority for the performance of its
functions.
(b) Money borrowed and to be repaid as authorized by sections
14 and 15.
(c) Revenues from any property, building, or facility owned,
leased, licensed, or operated by the authority or under its
control, subject to the limitations imposed upon the authority by
trusts or other agreements.
(d) Proceeds of a tax increment financing plan established
under sections 16 to 18.
(e) Proceeds from a special assessment district created as
provided by law.
(f) Money obtained from other sources approved by the
governing body of the municipality or otherwise authorized by law
for use by the authority or the municipality to finance a
development program.
(2) Money received by the authority and not covered under
subsection (1) shall immediately be deposited to the credit of the
authority, subject to disbursement under this act. Except as
provided in this act, the municipality shall not obligate itself,
and shall not be obligated, to pay any sums from public funds,
other than money received by the municipality under this section,
for or on account of the activities of the authority.
Sec. 14. The authority may borrow money and issue its
negotiable revenue bonds under the revenue bond act of 1933, 1933
PA 94, MCL 141.101 to 141.140.
Sec. 15. (1) The authority may with approval of the local
governing body borrow money and issue its revenue bonds or notes to
finance all or part of the costs of transit revitalization
development improvements in connection with either of the
following:
(a) The implementation of an improvement plan in the zone.
(b) The refund, or refund in advance, of bonds or notes issued
under this section.
(2) Any of the following may be financed by the issuance of
revenue bonds or notes:
(a) The cost of purchasing, acquiring, constructing,
improving, enlarging, extending, or repairing property in
connection with the implementation of an improvement plan in the
zone.
(b) Any engineering, architectural, legal, accounting, or
financial expenses.
(c) The costs necessary or incidental to the borrowing of
money.
(d) Interest on the bonds or notes during the period of
construction.
(e) A reserve for payment of principal and interest on the
bonds or notes.
(f) A reserve for operation and maintenance until sufficient
revenues have developed.
(3) The authority may secure the bonds and notes by mortgage,
assignment, or pledge of the property and any money, revenues, or
income received in connection with the property.
(4) A pledge made by the authority is valid and binding from
the time the pledge is made. The money or property pledged by the
authority immediately is subject to the lien of the pledge without
a physical delivery, filing, or further act. The lien of a pledge
is valid and binding against parties having claims of any kind in
tort, contract, or otherwise, against the authority, whether or not
the parties have notice of the lien. Neither the resolution, the
trust agreement, nor any other instrument by which a pledge is
created must be filed or recorded to be enforceable.
(5) Bonds or notes issued under this section are exempt from
all taxation in this state, and the interest on the bonds or notes
is exempt from all taxation in this state, notwithstanding that the
interest may be subject to federal income tax.
(6) The municipality is not liable on bonds or notes of the
authority issued under this section, and the bonds or notes are not
a debt of the municipality. The bonds or notes shall contain on
their face a statement to that effect.
(7) The bonds and notes of the authority may be invested in by
all public officers, state agencies and political subdivisions,
insurance companies, banks, savings and loan associations,
investment companies, and fiduciaries and trustees, and may be
deposited with and received by all public officers and the agencies
and political subdivisions of this state for any purpose for which
the deposit of bonds is authorized.
Sec. 16. (1) If the authority determines that it is necessary
for the achievement of the purposes of this act, the authority
shall prepare and submit a tax increment financing plan to the
governing body of the municipality. The plan shall include a
development plan as provided in section 19, a detailed explanation
of the tax increment procedure, the maximum amount of bonded
indebtedness to be incurred, and the duration of the program, and
shall be in compliance with section 17. The plan shall contain a
statement of the estimated impact of tax increment financing on the
assessed values of all taxing jurisdictions in which the zone is
located. The plan may provide for the use of part or all of the
captured assessed value, but the portion intended to be used by the
authority shall be clearly stated in the tax increment financing
plan. The authority or municipality may exclude from captured
assessed value growth in property value resulting solely from
inflation. The plan shall set forth the method for excluding growth
in property value resulting solely from inflation.
(2) Approval of the tax increment financing plan shall comply
with the notice, hearing, and disclosure provisions of section 21.
If the development plan is part of the tax increment financing
plan, only 1 hearing and approval procedure is required for the 2
plans together.
(3) Before the public hearing on the tax increment financing
plan, the governing body shall provide a reasonable opportunity to
the taxing jurisdictions levying taxes subject to capture to meet
with the governing body. The authority shall fully inform the
taxing jurisdictions of the fiscal and economic implications of the
proposed development area. The taxing jurisdictions may present
their recommendations at the public hearing on the tax increment
financing plan. The authority may enter into agreements with the
taxing jurisdictions, public transit agencies, and the governing
body of the municipality in which the zone is located to share a
portion of the captured assessed value of the development area.
(4) Before a tax increment financing plan is implemented, the
authority shall enter into a contract with the public
transportation agency that operates the transit station in the
zone. The contract shall include, but not be limited to, terms
regarding the distribution of revenue, the allocation of
responsibility for maintenance and upkeep of the transit station
and associated facilities, and the use of the facilities.
(5) A tax increment financing plan may be modified if the
modification is approved by the governing body upon notice and
after public hearings and agreements as are required for approval
of the original plan.
Sec. 17. (1) The municipal and county treasurers shall
transmit tax increment revenues to the authority.
(2) The authority shall expend the tax increment revenues
received for the improvement program only under the terms of the
tax increment financing plan. Unused funds shall revert
proportionately to the respective taxing bodies. Tax increment
revenues shall not be used to circumvent existing property tax
limitations. The governing body of the municipality may abolish the
tax increment financing plan if it finds that the purposes for
which it was established are accomplished. However, the tax
increment financing plan shall not be abolished until the principal
of, and interest on, bonds issued under section 18 have been paid
or funds sufficient to make the payment have been segregated.
(3) Annually the authority shall submit to the governing body
of the municipality and the state tax commission a report on the
status of the tax increment financing account. The report shall
include the following:
(a) The amount and source of revenue in the account.
(b) The amount in any bond reserve account.
(c) The amount and purpose of expenditures from the account.
(d) The amount of principal and interest on any outstanding
bonded indebtedness.
(e) The initial assessed value of the project area.
(f) The captured assessed value retained by the authority.
(g) The tax increment revenues received.
(h) The number of public facilities developed.
(i) The number of zone improvements made.
(j) A brief description of each zone improvement made within
the district.
(k) Any additional information the governing body considers
necessary.
Sec. 18. (1) By resolution of its governing body, the
authority may authorize, issue, and sell tax increment bonds
subject to the limitations set forth in this subsection to finance
the development program of the tax increment financing plan. The
tax increment bonds issued by the authority under this subsection
shall pledge solely the tax increment revenues of a zone in which
the project is located or a zone from which tax increment revenues
may be used for this project, or both. In addition or in the
alternative, the bonds issued by the authority under this
subsection may be secured by any other revenues identified in
section 13 as sources of financing for activities of the authority
that the authority shall specifically pledge in the resolution.
However, except as otherwise provided in this section, the full
faith and credit of the municipality shall not be pledged to secure
bonds issued under this subsection. The bond issue may include a
sum sufficient to pay interest on the tax increment bonds until
full development of tax increment revenues from the project and
also a sum to provide a reasonable reserve for payment of principal
and interest on the bonds. The resolution authorizing the bonds
shall create a lien on the tax increment revenues and other
revenues pledged by the resolution that shall be a statutory lien
and shall be a first lien subject only to liens previously created.
The resolution may provide the terms upon which additional bonds
may be issued of equal standing and parity of lien as to the tax
increment revenues and other revenues pledged under the resolution.
Bonds issued under this subsection that pledge revenue received
under section 16 for repayment of the bonds are subject to the
revised municipal finance act, 2001 PA 34, MCL 141.2101 to
141.2821.
(2) The municipality, by majority vote of the members of its
governing body, may make a limited tax pledge to support the
authority's tax increment bonds or notes or, if authorized by the
voters of the municipality, may pledge its unlimited tax full faith
and credit for the payment of the principal of and interest on the
authority's tax increment bonds or notes.
Sec. 19. (1) If a board decides to finance a project in a
development area by the use of revenue bonds as authorized in
section 14 or tax increment financing as authorized in sections 16,
17, and 18, it shall prepare an improvement plan.
(2) The improvement plan shall contain all of the following:
(a) The designation of boundaries of the zone in relation to
highways, streets, streams, lakes, other bodies of water, or
otherwise.
(b) The location and extent of existing streets and other
public facilities within the zone, designating the location,
character, and extent of the categories of public and private land
uses then existing and proposed for the zone, including
residential, recreational, commercial, industrial, educational, and
other uses, and including a legal description of the zone.
(c) A description of existing improvements in the zone to be
demolished, repaired, or altered, a description of any repairs and
alterations, and an estimate of the time required for completion.
(d) The location, extent, character, and estimated cost of the
improvements including rehabilitation contemplated for the zone and
an estimate of the time required for completion.
(e) A statement of the construction or stages of construction
planned, and the estimated time of completion of each stage.
(f) A description of any parts of the zone to be left as open
space and the use contemplated for the space.
(g) A description of any portions of the zone that the
authority desires to sell, donate, exchange, or lease to or from
the municipality and the proposed terms.
(h) A description of desired zoning changes and changes in
streets, street levels, intersections, or utilities.
(i) An estimate of the cost of the development, a statement of
the proposed method of financing the development, and the ability
of the authority to arrange the financing.
(j) Designation of the person or persons, natural or
corporate, to whom all or a portion of the development is to be
leased, sold, or conveyed in any manner and for whose benefit the
project is being undertaken if that information is available to the
authority.
(k) The procedures for bidding for the leasing, purchasing, or
conveying in any manner of all or a portion of the development upon
its completion, if there is no express or implied agreement between
the authority and persons, natural or corporate, that all or a
portion of the development will be leased, sold, or conveyed in any
manner to those persons.
(l) The requirement that amendments to an approved improvement
plan or tax increment plan must be submitted by the authority to
the governing body for approval or rejection.
(m) The transit improvements that will be made in the zone.
(n) Other material that the authority, local public agency, or
governing body considers pertinent.
(o) Based on consultation with the affected state and federal
authorities, an identification of the permits the board believes
necessary to complete the proposed public facility and an
explanation of how the proposed public facility will meet the
requirements necessary for issuance of each permit.
Sec. 20. (1) The governing body, before adoption of an
ordinance approving an improvement plan or tax increment financing
plan, shall hold a public hearing on the improvement plan. Notice
of the time and place of the hearing shall be given by publication
twice in a newspaper of general circulation designated by the
municipality, the first of which shall be not less than 20 days
before the date set for the hearing. Notice of the hearing shall be
posted in at least 20 conspicuous and public places in the
development area not less than 20 days before the hearing. Notice
shall also be mailed to all property taxpayers of record in the
development area and to the governing body of each taxing
jurisdiction levying taxes that would be subject to capture if the
tax increment financing plan is approved not less than 20 days
before the hearing.
(2) Notice of the time and place of hearing on an improvement
plan shall contain all of the following:
(a) A description of the proposed zone in relation to
highways, streets, streams, or otherwise.
(b) A statement that maps, plats, and a description of the
development plan, including the method of relocating families and
individuals who may be displaced from the area, are available for
public inspection at a place designated in the notice.
(c) A statement that all aspects of the improvement plan will
be open for discussion at the public hearing.
(d) Other information that the governing body considers
appropriate.
(3) At the time set for the hearing, the governing body shall
provide an opportunity for interested persons to speak and shall
receive and consider communications in writing. The hearing shall
provide the fullest opportunity for expression of opinion, for
argument on the merits, and for consideration of documentary
evidence pertinent to the improvement plan. The governing body
shall make and preserve a record of the public hearing, including
all data presented at the hearing.
Sec. 21. The governing body after a public hearing on the
improvement plan or the tax increment financing plan, or both, with
notice given under section 20, shall determine whether the
improvement plan or tax increment financing plan constitutes a
public purpose. If it determines that the improvement plan or tax
increment financing plan constitutes a public purpose, it shall by
ordinance approve or reject the plan, or approve it with
modification, based on the following considerations:
(a) The findings and recommendations of a zone citizens
council, if a zone citizens council was formed.
(b) The plan meets the requirements under section 19(2).
(c) The proposed method of financing the development is
feasible and the authority has the ability to arrange the
financing.
(d) The development is reasonable and necessary to carry out
the purposes of this act.
(e) The land included within the zone to be acquired is
reasonably necessary to carry out the purposes of the plan and of
this act in an efficient and economically satisfactory manner.
(f) The improvement plan is in reasonable accord with the land
use plan of the municipality.
(g) Public services, such as fire and police protection and
utilities, are or will be adequate to service the project area.
(h) Changes in zoning, streets, street levels, intersections,
and utilities are reasonably necessary for the project and for the
municipality.
Sec. 22. (1) The director of the authority shall submit a
budget to the board for the operation of the authority for each
fiscal year before the beginning of the fiscal year. The budget
shall be prepared in the manner and contain the information
required of municipal departments. After review by the board, the
budget shall be submitted to the governing body. The governing body
must approve the budget before the board may adopt the budget.
Unless authorized by the governing body or this act, funds of the
municipality shall not be included in the budget of the authority.
(2) The governing body of the municipality may assess a
reasonable pro rata share of the funds for the cost of handling and
auditing the funds against the funds of the authority, other than
those committed, which shall be paid annually by the board pursuant
to an appropriate item in its budget.
Sec. 23. An authority that has completed the purposes for
which it was organized shall be dissolved by ordinance of the
governing body. The property and assets of the authority remaining
after the satisfaction of the obligations of the authority belong
to the municipality.
Sec. 24. (1) The state tax commission may institute
proceedings to compel enforcement of this act.
(2) The state tax commission may promulgate rules necessary
for the administration of this act under the administrative
procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328.
