Bill Text: MI HB5385 | 2015-2016 | 98th Legislature | Introduced
Bill Title: State financing and management; authorities; Michigan financial review commission; expand to include certain education districts. Amends secs. 2, 3, 4, 5, 6, 7, 8 & 12 of 2014 PA 181 (MCL 141.1632 et seq.). TIE BAR WITH: HB 5296'16
Spectrum: Partisan Bill (Republican 4-0)
Status: (Passed) 2016-04-12 - Assigned Pa 53'16 With Immediate Effect [HB5385 Detail]
Download: Michigan-2015-HB5385-Introduced.html
HOUSE BILL No. 5385
February 18, 2016, Introduced by Reps. Poleski, Garcia, Price and Pscholka and referred to the Committee on Appropriations.
A bill to amend 2014 PA 181, entitled
"Michigan financial review commission act,"
by amending sections 2, 3, 4, 5, 6, 7, 8, and 12 (MCL 141.1632,
141.1633, 141.1634, 141.1635, 141.1636, 141.1637, 141.1638, and
141.1642).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 2. The legislature finds and declares the following:
(a) It is the public policy of this state to exercise its
sovereign powers with regard to debt issuance and matters of
statewide concern in a manner calculated to foster the fiscal
integrity of all municipal governments and school districts to
assure that those municipalities and school districts provide for
the
health, safety, and welfare of their citizens; residents; pay
principal and interest owed on debt obligations when due; meet
financial obligations to their existing and former employees,
vendors, and suppliers; and provide for proper financial planning
procedures and budgeting practices. The inability of a municipal
government to provide essential services to its citizens or a
school district to provide public education services to its
residents as a result of fiscal emergencies is determined to affect
adversely the health, safety, and welfare of not only that
municipality's citizens and a school district's residents, but also
other citizens of this state.
(b) The police and fire retirement system of certain qualified
cities and the general retirement system of certain qualified
cities are currently underfunded, causing communities across the
state to face higher costs to borrow and invest funds, and have
caused bondholders, bond insurers, and financial institutions
anxiety over the financial health of not only certain qualified
cities, but communities across this state.
(c) Absent prospective state oversight over qualified cities
and school districts, there exists a threat of increased costs in
borrowing, reductions in credit or bond ratings, reduced faith from
existing creditors of municipalities or school districts and of
this state, and dire financial circumstances from which this state
and its political subdivisions may never fully recover.
(d) Qualified cities and school districts have complex
budgetary and fiscal needs, significant and complicated debt
management issues, and financial assets and liabilities that
impact, both positively and negatively, every unit of local
government and school district in this state and this state itself
such that reasonable and balanced state oversight over qualified
cities and school districts is required as a reasonable exercise of
this state's power for the benefit of residents throughout this
state.
(e) There are numerous residents of this state who have
accrued pension benefits from a qualified city's pension systems,
and those pensioners may reside throughout this state. The
settlement of bankruptcy cases involving qualified cities is likely
to have a substantial positive impact statewide.
(f) Establishing a commission and execution by the commission
of its powers granted under this act fulfill in all respects a
public and governmental purpose for the benefit of the people of
this state.
(g) Ongoing fiscal oversight over qualified cities and school
districts is a reasonable and sufficiently narrow regulation and
serves a significant and legitimate public purpose because it
inures to the benefit of all of this state's residents and aids in
the remedy of a broad and general social problem.
(h) Fiscal oversight over qualified cities and school
districts will ensure that those qualified cities and school
districts do not engage in the financial practices that led to
financial emergencies and insolvency, and ultimately, entry into
receivership and bankruptcy, which will ensure that those cities
can provide basic and essential municipal services to their
residents and that those school districts can provide public
education services to their residents.
Sec. 3. As used in this act:
(a) "Applicable contract" means a contract for goods or
services proposed or entered into by a qualified city or school
district that either exceeds $750,000.00, or a higher amount as
determined by the commission, or is for a term exceeding 2 years.
Applicable contract also includes multiple contracts for less than
$750,000.00, or the higher amount determined by the commission,
with 1 entity that, in the aggregate, exceed $750,000.00, or a
higher amount as determined by the commission, within a 12-month
period.
(b) "Federal bankruptcy code" means the federal bankruptcy
code, 11 USC 101 to 1532.
(c) "Financial review commission" or "commission" means a
financial review commission created in section 4.
(d) "Operating expenses" means the reasonable operating
expenses of the commission, including without limitation the cost
of preparing accounting and other reports, costs of commission
meetings or other required activities of the commission, counsel
fees, including fees of the attorney general, and fees and expenses
incurred for consultants and fiduciaries required to carry out the
purposes of this act.
(e) "Person" means an individual, corporation, limited or
general partnership, association, joint venture, limited liability
company, a governmental entity, including this state.
(f) "Plan for adjustment" means the plan for the adjustment of
debts of a qualified city approved and entered by a United States
bankruptcy court under chapter 9 of title 11 of the United States
Code, 11 USC 901 to 946.
(g) "Professional services" means services that require a high
degree of intellectual skill, an advanced degree, or professional
licensing or certification. Those providing the professional
services are distinguished based on their specialized knowledge,
experience, and expertise. Professional services include, but are
not limited to, accounting, actuarial, appraisal, auditing,
investment advisor, and legal services.
(h) "Qualified city" means a city with a population of more
than 600,000 that is subject to a plan for adjustment.
(i) "Qualified school district" means a community district
organized under part 5b of the revised school code, 1976 PA 451,
MCL 380.381 to 380.393, to which the functions and responsibilities
of a qualifying school district under section 402 of the revised
school code, 1976 PA 451, MCL 380.402, have been transferred under
that section.
(j) (i)
"State treasurer" means
the treasurer of this state or
his or her designee who shall be designated by a written instrument
signed by the state treasurer and maintained in a permanent file
and whose signature shall have the same force and effect as the
signature of the state treasurer for all purposes under this act.
Sec.
4. (1) A Except
as provided in subsection (2), a
financial review commission is created within the department of
treasury for each qualified city and each qualified school
district. Except as otherwise provided in this act, a commission
shall exercise its powers, duties, functions, and responsibilities
under this act independently of the state treasurer. The budgeting,
procurement, personnel, and related management functions of a
commission shall be performed under the direction and supervision
of the state treasurer.
(2) If a community district organized under part 5b of the
revised school code, 1976 PA 451, MCL 380.381 to 380.393, becomes a
qualified school district under this act and that qualified school
district is located within the geographic boundaries of a qualified
city for which a financial review commission is operating under
this act, beginning on the transfer date, as that term is defined
under section 402 of the revised school code, 1976 PA 451, MCL
380.402, the financial review commission for that qualified city
also shall be the financial review commission for that qualified
school district, and no separate or additional financial review
commission for that qualified school district is created under this
act.
Sec.
5. (1) Each Except as
otherwise provided in subsection
(2), each commission shall consist of the following 9 members:
(a) The state treasurer, who shall serve for the duration of
his or her term of office.
(b) The director of the department of technology, management,
and budget or successor agency, or his or her designee, who shall
serve for the duration of his or her term of office.
(c) Three members appointed by the governor who have
knowledge, skill, or experience in the field of business or finance
and who shall possess knowledge, training, skill, or experience in
budgeting, revenue forecasting, debt management or borrowing,
actuarial science, law, or business operations, at least 1 of whom
is a resident of that qualified city or qualified school district
other than a qualified school district described in section 4(2),
and at least 1 of whom is a resident of this state who is not a
resident of a qualified city or qualified school district other
than a qualified school district described in section 4(2).
(d) The mayor or chief executive officer of that qualified
city or qualified school district other than a qualified school
district described in section 4(2), or his or her designee, who
shall serve for the duration of the mayor's or chief executive
officer's term of office.
(e) One member appointed by the governor from a list of 3 or
more individuals nominated by the senate majority leader who have
knowledge, skill, or experience in the field of business or
finance, and who shall possess knowledge, training, skill, or
experience in budgeting, revenue forecasting, debt management or
borrowing, actuarial science, law, or business operations, and 1 of
whom is a resident of that qualified city or qualified school
district other than a qualified school district described in
section 4(2).
(f) One member appointed by the governor from a list of 3 or
more individuals nominated by the speaker of the house of
representatives who have knowledge, skill, or experience in the
field of business or finance, and who shall possess knowledge,
training, skill, or experience in budgeting, revenue forecasting,
debt management or borrowing, actuarial science, law, or business
operations, and 1 of whom is a resident of that qualified city or
qualified school district other than a qualified school district
described in section 4(2).
(g) The president or chairperson of the qualified city's
governing
body or his or her designee, qualified
school district's
school board other than a qualified school district described in
section 4(2), or his or her designee, who shall serve for the
duration of the president's or chairperson's term of office.
(2) If a financial review commission is the financial review
commission for both a qualified city and a qualified school
district under section 4(2), in addition to the mayor or chief
executive officer of the qualified city or his or her designee
under subsection (1)(d) and the president or chairperson of the
qualified city's governing body or his or her designee under
subsection (1)(g), the financial review commission also shall
include as members the superintendent of the qualified school
district and the chairperson of the school board of the qualified
school district. The superintendent of the qualified school
district and the chairperson of the school board of the qualified
school district shall not have a vote on matters relating to the
qualified city. The mayor or chief executive officer of the
qualified city, or his or her designee under subsection (1)(d) and
the president or chairperson of the qualified city's governing body
or his or her designee under subsection (1)(g), shall not have a
vote on matters relating to the qualified school district.
(3) (2)
The appointed members shall serve
for a term of 4
years, except that of the 5 members first appointed, the appointees
of the governor shall serve a term of 1, 2, and 4 years
respectively, the appointee of the governor who was nominated by
the speaker of the house of representatives shall serve a term of 2
years, and the appointee of the governor who was nominated by the
senate majority leader shall serve a term of 3 years. Appointed
members serve at the pleasure of, and may be removed by, their
respective appointing official.
(4) (3)
Members of a commission shall serve
without
compensation but may receive reasonable reimbursement for necessary
travel and expenses incurred in the discharge of their official
duties.
(5) (4)
The state treasurer or his or her
designee shall serve
as chairperson of a commission.
(6) (5)
A majority of the members of the
commission shall
constitute a quorum of the commission for the transaction of
business. The commission shall meet no less than monthly and at
times and places designated by the chairperson. Actions of the
commission shall be approved by a majority of the members.
(7) (6)
The commission shall conduct its
business at public
meetings in compliance with the open meetings act, 1976 PA 267, MCL
15.261 to 15.275. However, members of the commission may attend and
participate in a meeting of the commission by the use of
telecommunication or other electronic equipment if their attendance
and participation by the use of telecommunication or other
electronic equipment is authorized by the bylaws of the commission
and that meeting is otherwise conducted in compliance with the open
meetings act, 1976 PA 267, MCL 15.261 to 15.275.
(8) (7)
A writing prepared, owned, used, in
the possession of,
or retained by the commission in the performance of an official
function is subject to the freedom of information act, 1976 PA 442,
MCL 15.231 to 15.246.
(9) (8)
The commission shall adopt bylaws
for governance of
the commission, which shall, at a minimum, address the procedures
for conducting meetings, including voting procedures, and the
requirements of its members to attend meetings. Procedural rules
required by this section are not subject to the administrative
procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328.
(10) (9)
The commission may contract for
professional
services, as it requires, and shall determine the qualifications it
considers necessary.
(11) (10)
The members of the commission and
contractors or
agents of the commission are subject to 1968 PA 317, MCL 15.321 to
15.330, and 1968 PA 318, MCL 15.301 to 15.310.
(12) (11)
A member of the commission, and any
person the
commission contracts with, shall discharge the duties of his or her
position in a nonpartisan manner, with good faith, and with that
degree of diligence, care, and skill that an ordinarily prudent
person would exercise under similar circumstances in a like
position. The commission shall adopt an ethics policy governing the
conduct of commission members and officers and employees of the
commission.
(13) (12)
Commission members shall take and
subscribe to the
constitutional oath of office under section 1 of article XI of the
state constitution of 1963. The oath shall be filed with the
secretary of state.
Sec. 6. (1) The commission shall provide oversight for a
qualified city beginning on the effective date of the plan for
adjustment or of this act, whichever is later. The commission shall
provide oversight for a qualified school district beginning on the
date the school district becomes a qualified school district.
(2) The commission shall ensure that the qualified city or
qualified school district is complying with the terms and
conditions of this act and of the plan for adjustment, if
applicable. Except as otherwise provided in section 8, the
commission shall by October 1 each year certify that the qualified
city or qualified school district is in substantial compliance with
the provisions of this act.
(3) The commission shall ensure that, where applicable, a
qualified city or qualified school district complies with the
provisions of all of the following, as applicable, and may request
verification of compliance:
(a) Section 8 of the publicly funded health insurance
contribution act, 2011 PA 152, MCL 15.568.
(b) Sections 4i, 4p, 4s, and 4t of the home rule city act,
1909 PA 279, MCL 117.4i, 117.4p, 117.4s, and 117.4t.
(c) The revised municipal finance act, 2001 PA 34, MCL
141.2101 to 141.2821.
(d) The uniform budgeting and accounting act, 1968 PA 2, MCL
141.421 to 141.440a.
(e) For a qualified school district, all of the following:
(i) The revised school code, 1976 PA 451, MCL 380.1 to
380.1852.
(ii) Article I of the state school aid act of 1979, 1979 PA
94, MCL 388.1601 to 388.1772.
(iii) The public school employees retirement act of 1979, 1980
PA 300, MCL 38.1301 to 38.1437.
(4) During the period of oversight for a qualified city, the
commission shall review and approve that qualified city's 4-year
financial plan required by section 4t of the home rule city act,
1909 PA 279, MCL 117.4t. A 4-year financial plan described in this
subsection shall be submitted at least 100 days prior to the
commencement of a qualified city's fiscal year. The commission
shall approve or disapprove the 4-year financial plan within 30
days of receipt. If disapproved, the commission shall provide
rationale in writing for disapproval and a qualified city shall
submit a revised plan within 15 days that comports with the
commission's rationale for rejection. The commission shall approve
or disapprove that revised plan within 15 days. The commission may
also require adjustments to the financial plan to modify
expenditures to satisfy debt service, adjust projected revenues to
comply with financial controls or accounting practices, and reduce
expenditures to conform to consensus revenue estimates if required
in section 7 to comply with the provisions of section 4t of the
home rule city act, 1909 PA 279, MCL 117.4t. If the qualified city
fails to submit an acceptable financial plan, the commission may
adopt and impose upon the qualified city a financial plan
satisfying the requirements of this act and section 4t of the home
rule city act, 1909 PA 279, MCL 117.4t, until that time as the
qualified city submits an acceptable financial plan.
(5) Subject to a plan for adjustment and any collective
bargaining agreements still in effect, the commission shall
establish and maintain programs and requirements for the
responsible fiscal management of that qualified city or qualified
school district. The commission's programs and requirements shall
include all of the following:
(a) Increased managerial accountability.
(b) The streamlining of the provision of city or qualified
school district services.
(c) Improved collection of outstanding tax revenues.
(d) Review of the compensation and benefits of city or
qualified school district employees and recommendation of
adjustments where necessary.
(6) Notwithstanding any charter provision or local ordinance
to the contrary, all applicable contracts are subject to review and
approval by the commission. The commission may consider a number of
factors when reviewing an applicable contract, including whether
the applicable contract was subject to a competitive bid process.
Only applicable contracts that are first approved by the governing
body and mayor or chief executive officer of a qualified city or
qualified school district as required by law, charter, ordinance,
or policy are subject to review by the commission. If an applicable
contract is not rejected by the commission within 30 days of its
submission, that applicable contract shall be considered approved
by the commission.
(7)
A qualified city , or
qualified school district, when
required by the commission, shall present written reports regarding
its financial stability and shall permit the commission to audit or
inspect financial statements, actuarial reports, revenue estimates,
and any and all other documents, data, reports, or findings that
the commission considers necessary to carry out its purpose under
this act. The commission may require that qualified city's or
qualified school district's chief financial officer to certify in
writing the accuracy of any documents the commission requests.
(8) The commission shall, on June 1 and December 1 of each
year in which the commission has oversight over a qualified city or
a qualified school district, file a written report with the
governor. A copy of the report shall be submitted to the senate
majority leader and the speaker of the house of representatives and
posted on the department of treasury website. A copy of the report
shall be sent to the mayor or chief executive officer and governing
body of the qualified city or qualified school district.
(9) Except as otherwise provided in this subsection, the
commission shall approve all collective bargaining agreements,
including any addendums to those agreements, to which that
qualified city or qualified school district is a party after
approval by the governing body and mayor or chief executive officer
of the qualified city or qualified school district as required by
charter or law. The commission shall approve or reject collective
bargaining agreements submitted to it within 45 days of submission.
Collective bargaining agreements submitted to the commission shall
not be executed unless and until the commission approves those
agreements. Collective bargaining agreements approved by an
emergency manager appointed under section 12 of the local financial
stability and choice act, 2012 PA 436, MCL 141.1552, shall not be
subject to commission approval under this subsection.
(10)
The For a qualified city,
the commission may file
supplementary information relating to the financial condition of
the qualified city with an arbitration panel in arbitration
proceedings in which the qualified city is a party pursuant to 1969
PA 312, MCL 423.231 to 423.247.
(11) The mayor or chief executive officer, governing body, and
chief financial officer of a qualified city or qualified school
district shall, at least 45 days prior to the beginning of each
fiscal quarter, certify in writing to the commission the amount of
debt
service due on bonds, leases, or other municipal debt. A
qualified city or qualified school district shall specifically
report debt service requirements, calculated through final
maturity, and certify its ability to meet those requirements
through the end of the current fiscal year.
Sec. 7. A commission may do 1 or more of the following for its
qualified city or qualified school district:
(a)
Review For a qualified
city, review and approve that
qualified city's consensus revenue estimate under section 4t of the
home rule city act, 1909 PA 279, MCL 117.4t. The commission may
also, after consultation with the qualified city or qualified
school district, revise a revenue estimate prepared in connection
with a budget, budget modification, financial plan, or financial
plan modification, if the commission determines that the revenue
estimate was not based on assumptions and methods of estimation
reasonable and appropriate under the circumstances and in view of
the objectives and purposes of this act. After consultation with
the qualified city or qualified school district, the commission may
determine the estimated revenues for the qualified city or
qualified school district, but any revenue estimate adopted by the
commission shall be based on the same requirements as the qualified
city's or qualified school district's initial revenue estimate.
(b)
Require a For a qualified
city, require the qualified city
to submit the 4-year financial plan required in section 4t of the
home rule city act, 1909 PA 279, MCL 117.4t, in a form and manner
the commission considers appropriate. The requirement to submit a
4-year financial plan is not subject to waiver under section 8.
(c) Review, modify, and approve proposed and amended
operational budgets of a qualified city or qualified school
district. A proposed budget or budget amendment does not take
effect unless approved by the commission.
(d) Require the chief financial officer of the qualified city
or qualified school district to provide the commission with
information it requests related to the qualified city's or
qualified school district's finances. The commission may also
require the chief financial officer to attend commission meetings.
If the chief financial officer fails to comply with the provisions
of this subdivision, the commission may require the qualified city,
or qualified school district to remove the chief financial officer
and appoint a successor.
(e) Review and approve requests by a qualified city or
qualified school district to issue debt under the revised municipal
finance act, 2001 PA 34, MCL 141.2101 to 141.2821, or any other law
governing the issuance of bonds or notes. The commission may
develop rules for the issuance of debt, including limitations that
are greater than those provided in sections 401 to 405 of the
revised municipal finance act, 2001 PA 34, MCL 141.2401 to
141.2405. The debt described in this subdivision may not be issued
unless and until approved by the commission and the commission's
approval shall be in addition to any approval of the department of
treasury as required by law.
(f) Review compliance by a qualified city with a deficit
elimination plan submitted under section 21 of the Glenn Steil
state revenue sharing act of 1971, 1971 PA 140, MCL 141.921, or by
a qualified school district with a deficit elimination plan
submitted under article I of the state school aid act of 1979, 1979
PA 94, MCL 388.1601 to 388.1772.
(g) Approve the appointment of a qualified city's or qualified
school district's chief financial officer. If that appointment is
not approved by the commission within 45 days of written submission
of the appointment by the qualified city or qualified school
district, the appointment is denied. The commission may require
that any effort to terminate the chief financial officer be subject
to commission review and approval.
(h) For a qualified school district, approve the appointment
of the qualified school district's superintendent. If that
appointment is not approved by the commission within 45 days of
written submission by the qualified school district, the
appointment is denied. A qualified school district may not alter
the terms and conditions of an employment contract with or the
benefits of its superintendent or terminate its superintendent
without the approval of the commission. The superintendent and the
chairperson of the school board of the qualified school district
shall not have a vote on an approval under this subdivision.
(i) (h)
Require the development and
implementation of
financial best practices for a qualified city or qualified school
district.
(j) (i)
Recommend the adoption or amendment
of certain charter
provisions, bylaws, ordinances, policies, or operating procedures
for the qualified city or qualified school district, as applicable.
(k) (j)
Require the pursuit of financial or
managerial
training to ensure the proper discharge of duties for the qualified
city or qualified school district.
(l) (k)
Make and execute contracts
necessary to carry out the
purposes of this act.
(m) (l) Sue or
be sued. The commission may retain legal
counsel to enforce any provisions of this act.
(n) (m)
Require the qualified city or qualified school
district and the employees or agents of the qualified city or
qualified school district to timely produce and share all
information and documents, and provide access to all information on
assets, services, records, and any other materials or documents the
commission determines are necessary to carry out its
responsibilities under this act. The commission may require the
officers or employees of the qualified city or qualified school
district to attend commission meetings for any purpose necessary to
carry out its responsibilities under this act.
(o) (n)
Perform any duty provided by law
that a receivership
transition advisory board as described in section 23 of the local
financial stability and choice act, 2012 PA 436, MCL 141.1563, may
perform.
(p) (o)
Perform any other duties assigned
by the governor that
are not inconsistent with the purposes of this act.
Sec. 8. (1) Notwithstanding section 6, for its qualified city
or qualified school district, a commission shall, by resolution,
waive the requirements designated in sections 6 and 7 as provided
in subsection (2).
(2) The commission shall grant a waiver under this section for
its qualified city or qualified school district if it certifies
that all of the following conditions are met:
(a) The commission certifies that a qualified city or
qualified school district has adopted and adhered to deficit-free
budgets for 3 consecutive years that comply with generally accepted
accounting principles and are in accordance with the uniform
budgeting and accounting act, 1968 PA 2, MCL 141.421 to 141.440a.
(b) The state treasurer and the qualified city's or qualified
school district's chief financial officer, if applicable, certify
that both of the following are met:
(i) All municipal securities or debt obligations sold by or
for the benefit of that qualified city or qualified school district
in the general public market during the immediately preceding
fiscal year and current fiscal year satisfied the capital and other
financial requirements of the qualified city or qualified school
district during that period.
(ii) There is a substantial likelihood that municipal
securities or debt obligations can be sold by the qualified city or
qualified school district in the general public market during the
remainder of the current fiscal year and the immediately succeeding
fiscal year in amounts sufficient to substantially satisfy all of
the capital and other financial requirements of the qualified city
or qualified school district during those periods in accordance
with the qualified city's or qualified school district's financial
plan, as applicable.
(c)
The For a qualified city,
the qualified city's financial
plan projects a balanced budget for the current and succeeding 3
fiscal years using generally accepted accounting principles and in
accordance with the uniform budgeting and accounting act, 1968 PA
2, MCL 141.421 to 141.440a, and section 4t of the home rule city
act, 1909 PA 279, MCL 117.4t.
(d) The qualified city or qualified school district has
demonstrated to the commission's satisfaction that the qualified
city has sufficient ability to borrow in the municipal securities
market.
(e) The qualified city or qualified school district did not
violate the plan for adjustment in the immediately preceding fiscal
year, as applicable, and is not in violation in the current fiscal
year.
(f) The state treasurer certifies that the qualified city or
qualified school district is in compliance with the uniform
budgeting and accounting act, 1968 PA 2, MCL 141.421 to 141.440a.
(g) The commission certifies that the qualified city or
qualified school district is in substantial compliance with this
act.
(h)
The For a qualified city,
the qualified city has
established as part of a system of compensation for employees
retirement plans in which the qualified city contributes no more
than 7% of an individual's base pay, excluding payment for overtime
services, 1-time lump-sum payments, and the cost of fringe
benefits, to an employee's retirement account. For a qualified
school district, the qualified school district has fully satisfied
all of its obligations to the system created under the public
school employees retirement act of 1979, 1980 PA 300, MCL 38.1301
to 38.1437, and under any school improvement plan or measure
applicable under section 1280c of the revised school code, 1976 PA
451, MCL 380.1280c.
(i) The qualified city or qualified school district has
implemented a program in which all contracts awarded by the
qualified city or qualified school district are posted on the
qualified city's or qualified school district's public website
within 30 days of the contract award, including the identity of the
parties to the contract, the dollar amount of the contract, and a
brief description of the goods or services provided by the
contract.
(3) The commission shall, by resolution, rescind its waiver
under subsection (2) if it certifies that any of the following,
where applicable, has occurred or that there is a substantial
likelihood that any of the following will imminently occur:
(a) The qualified city or qualified school district fails to
pay principal of or interest on any municipal securities when due
or payable.
(b) The qualified city or qualified school district incurs a
budget deficit in a fiscal year equal to or more than 5% of the
total expenditures in that year based on generally accepted
accounting principles.
(c) The qualified city or qualified school district issues
municipal securities without the authorization of the commission or
in violation of the revised municipal finance act, 2001 PA 34, MCL
141.2101 to 141.2821.
(d) The qualified city or qualified school district violates
this act or any mandatory financial controls in a manner that
substantially impairs that qualified city's or qualified school
district's ability to pay principal of and interest on municipal
securities or other debt when due and payable or its ability to
adhere to a balanced budget.
(e) The qualified city or qualified school district violates
any provision of the plan for adjustment, if applicable.
(f) The state treasurer and the qualified city's or qualified
school district's chief financial officer, if applicable, fail to
certify that the criteria in subsection (2)(b) are met.
(g)
If the The qualified city's or qualified school district's
chief financial officer has resigned, been terminated, or been
removed, or the office has otherwise become vacant and a successor
has not been appointed within 180 days of that vacancy.
(h) The qualified city or qualified school district has not
satisfied the requirements in subsection (2)(h).
(i) For a qualified school district, the qualified school
district is not in compliance with a school improvement plan or
measure applicable under section 1280c of the revised school code,
1976 PA 451, MCL 380.1280c.
(4) If the commission for a qualified city finds that the
circumstances under which it rescinded its waiver of the
requirements of sections 6 and 7 as provided in subsection (3) no
longer exist, the commission shall reverse the rescission as
provided in subsection (2).
Sec. 12. (1) If a commission for a qualified city has waived
the requirements of sections 6 and 7 under section 8 each year for
the immediately preceding 10 consecutive fiscal years, and the plan
for adjustment, if applicable, has expired, the commission shall,
by resolution, dissolve itself. All property, funds, and assets of
the commission, if any, shall be transferred to and vested in this
state.
(2) If a commission is in place for both a qualified city and
a qualified school district described in section 4(2) located
within the qualified city, the commission may not dissolve itself
until both of the following occur:
(a) The state treasurer certifies under section 402 of the
revised school code, 1976 PA 451, MCL 380.402, the payment in full
of all outstanding debt of the school district from which functions
and responsibilities were transferred to the qualified school
district under section 402 of the revised school code, 1976 PA 451,
MCL 380.402.
(b) The qualified school district has been in compliance with
this act for the immediately preceding 10 consecutive fiscal years.
