SB-1116, As Passed House, December 20, 2018
HOUSE SUBSTITUTE FOR
SENATE BILL NO. 1116
A bill to amend 1987 PA 231, entitled
"An act to create a transportation economic development fund in the
state treasury; to prescribe the uses of and distributions from
this fund; to create the office of economic development and to
prescribe its powers and duties; to prescribe the powers and duties
of the state transportation department, state transportation
commission, and certain other bodies; and to permit the issuance of
certain bonds,"
by amending sections 3, 9, 10, 11, and 13 (MCL 247.903, 247.909,
247.910, 247.911, and 247.913), sections 3, 11, and 13 as amended
by 2016 PA 501, section 9 as amended by 2016 PA 500, and section 10
as amended by 1993 PA 149.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
1 Sec. 3. (1) Money from the fund shall be allocated for
2 projects to be funded under section 11(3)(a) in accordance with the
3 adopted policies of the commission. No funds shall be committed to
4 any project, nor shall any project be authorized for any funds
1 under this act, until the commission notifies the senate committee
2 on transportation and the house committee on transportation and the
3 subcommittees on transportation of the senate and house
4 appropriations committees of the proposed projects in the manner as
5 provided in section 18k of 1951 PA 51, MCL 247.668k. Hearings may
6 be conducted to afford interested parties the opportunity to
7 address aspects of the selection process, the final project list,
8 proposed funding, and related issues. If such hearings are not
9 conducted by the senate committee on transportation and the house
10 committee on transportation and the subcommittees on transportation
11 of the senate and house appropriations committees within 30 days,
12 if both the senate and house are in session, or 60 days, if either
13 the senate or the house or both are not in session of project
14 notification by the commission, the department may proceed with
15 project authorization for funding.
16 (2) The commission shall not commit funds to any project in a
17 new category for funding under section 7(3) or section 9(1)(a)
18 before the commission notifies the legislative committees of the
19 criteria for approval of projects under these categories in the
20 same manner described in this section.
21 (3) Projects in section 11(3)(a) shall be coordinated with
22 projects in section 11(3)(c) through the designated representatives
23 on the urban task forces and regional rural task forces.
24 (4) The department may be the contracting agent for all
25 projects to be funded by this act. Contracts shall be awarded
26 consistent with the policies of the commission.
27 (5) The administrator or the person acting in that capacity
1 shall assist the commission in reviewing recommendations for
2 funding projects under this act.
3 (6) Of the money appropriated to the fund, not more than 1% as
4 annually appropriated by the legislature shall be appropriated for
5 administration of the fund. Not more than $100,000.00 of the money
6 allocated under section 11(3)(a) for projects described in section
7 9(1)(b) may be expended for administration of those projects.
8 (7) The commission shall do the following:
9 (a) Establish criteria for the awarding of projects.
10 (b) Exercise oversight as it may consider appropriate to
11 facilitate its development of policy for administration of the
12 fund.
13 (c) Review all projects recommended for funding to assure that
14 they satisfy commission policies and criteria. Funds shall not be
15 allocated to projects unless they are in accord with commission
16 policy and criteria.
17 (8) The office of economic development shall review each
18 project application and recommend the award of funding to selected
19 projects in accordance with the adopted policies of the commission.
20 Sec. 9. (1) A project shall relate to 1 or more of the
21 following categories:
22 (a) Economic development road projects in any of the following
23 targeted industries:
24 (i) Agriculture or food processing.
25 (ii) Tourism.
26 (iii) Forestry.
27 (iv) High technology research.
1 (v) Manufacturing.
2 (vi) Mining.
3 (vii) Office centers of not less than 50,000 square feet.
4 (viii) Medical research or medical tourism facilities of not
5 less than 50,000 square feet.
6 (b) Projects for construction or preservation of streets in
7 cities and villages with a population of 10,000 or less, including,
8 but not limited to, reconstruction, replacement, rehabilitation,
9 and capital preventive maintenance.
10 (c) (b) Projects
for reducing congestion on county primary and
11 city major streets within urban counties including advanced traffic
12 management systems.
13 (d) (c) Projects
for improvements within rural counties on
14 rural primary roads and major streets in cities and villages with a
15 population of 5,000 or less.
16 (e) (d) Projects
for improvements within rural counties on
17 county rural primary roads or major streets within incorporated
18 villages and cities with a population of more than 5,000.
19 (2) The minimum requirements specified in section 7 for
20 projects identified in subsection (1)(a) shall ensure that those
21 projects satisfy the following requirements:
22 (a) Meet a particular transportation need that is shown to
23 exist.
24 (b) Have an immediate positive impact on local employment and
25 the economy.
26 (c) Exclude speculative projects with little or no return on
27 investment. Projects that contribute to the economic development
1 and redevelopment of areas having experienced or having significant
2 potential to experience job loss that meet the criteria for funding
3 under section 7(3)(b)(ii) are not speculative for the purposes of
4 this subdivision.
5 (d) Provide cooperation and support between developers and
6 state and local government.
7 (e) Were evaluated on the basis of impact on the local
8 community.
9 (3) A project that is within 1 or more of the categories in
10 subsection (1) shall meet the criteria developed for each category.
11 Sec. 10. (1) The costs of a project that are eligible to be
12 funded under section 11(3)(a) and (c) shall be developed by the
13 administrator in accordance with the adopted policies of the
14 commission and shall include at a minimum those costs normally
15 associated with highway construction projects such as project
16 planning, design, right-of-way acquisition, and construction, but
17 excluding routine maintenance.
18 (2) The costs of a project that are eligible to be funded
19 under section 11(3)(d) shall be developed by the administrator in
20 accordance with the adopted policies of the commission and shall
21 exclude right-of-way acquisition, design, engineering, and routine
22 maintenance.
23 (3) Matching funds of not less than 20% of the total eligible
24 costs of a project shall be required for those projects described
25 in section 9(1)(a), (c), and (d), and (e). This requirement
may be
26 set aside in the case of extreme economic hardship for projects
27 described in section 9(1)(a)
, (c), and (d) in the local unit in
1 which the project is located. Evaluation criteria for projects
2 described in section 9(1)(a) shall include whether there is a
3 contribution of more than the required 20% matching funds as part
4 of the determination of which projects are to be funded.
5 (4) An individual grant for a project described in section
6 9(1)(b) shall not exceed $250,000.00, and matching funds of not
7 less than 50% of the total eligible costs of the project shall be
8 required.
9 Sec. 11. (1) Bonds may be issued as authorized by the
10 commission for the purpose of funding projects under this act in
11 the manner provided in sections 18b and 18k of 1951 PA 51, MCL
12 247.668b and 247.668k, and in accordance with the adopted policies
13 of the commission. Bonds shall not be committed for any project
14 under this act until the requirements under section 3(1) have been
15 satisfied.
16 (2) After the payment of interest and principal on bonds
17 issued under this act and the appropriation for costs of
18 administration of the fund as provided under this act, fund revenue
19 shall be annually appropriated as follows:
20 (a) The first $5,000,000.00 for a forest roads program. Forest
21 roads program funds shall be distributed each fiscal year to each
22 qualified county in a percentage amount equal to the same
23 percentage amount that the number of acres of commercial forest,
24 national park, and national lakeshore land in each qualified county
25 bears to the total number of acres of commercial forest, national
26 park, and national lakeshore land in all qualified counties in this
27 state. Revenue distributed under this subdivision shall be used for
1 the construction or reconstruction of roads.
2 (b) The next $2,500,000.00 of the fund shall be distributed
3 each fiscal year for improvements within rural counties to roads
4 and streets that are eligible for federal aid and are located
5 inside the boundaries of an urban area or an urbanized area as
6 determined by the most recent federal decennial census and as
7 adjusted by the department.
8 (3) Of the balance remaining after funding projects under
9 subsection (2), projects shall be funded in the categories
10 described in section 9 based on the following percentages:
11 (a) 50% for economic development road projects in any of the
12 targeted industries. For the fiscal year years ending
September 30,
13 2017 2019 through
September 30, 2023 only, the allocation
made
14 under this subdivision shall be reduced by
15 $9,423,700.00.$3,000,000.00
and allocated to projects described in
16 section 9(1)(b). The office of economic development shall use
17 geographic distribution as a grant selection criterion for projects
18 described in section 9(1)(b). An eligible city or village may apply
19 for a grant for a project described in section 9(1)(b) in
20 consecutive fiscal years.
21 (b) 25% for projects to reduce congestion on county primary
22 and city major streets within urban counties including advanced
23 traffic management systems. The funds shall be distributed to
24 counties with populations in excess of 400,000 in accordance with
25 the following formula:
|
26 |
Population |
Percentage of Funds |
|
|
27 |
1,750,000 or more |
16% |
|
1 |
1,000,000 to 1,749,999 |
40% |
|
|
2 |
650,001 to 999,999 |
20% |
|
|
3 |
400,000 to 650,000 |
24% |
4 When 2 or more counties occupy the same category, the funds
5 shall be divided equally.
6 Projects funded under this category shall be used for the
7 widening of county primary roads or city major streets or for
8 advanced traffic management systems in eligible counties.
9 (c) 25% for projects within rural counties. These revenues
10 shall be distributed for the improvement of rural primary roads in
11 rural counties and major streets in cities and villages with a
12 population of 5,000 or less that are located outside the boundaries
13 of an urban area or an urbanized area as determined by the most
14 recent federal decennial census and as adjusted by the department.
15 Funds distributed under this subdivision shall be allocated by the
16 commission to the regional rural task force areas defined described
17 in section 12a in the same proportion that the rural primary
18 mileage of the regional rural task force area bears to the total
19 rural primary mileage of all counties. Each rural county shall be
20 credited with an allocation in the proportion that the county's
21 rural primary mileage is to the total rural primary mileage of
22 those rural counties within the same regional rural task force
23 area. Projects funded under this subdivision shall be limited to
24 upgrading rural primary roads and major streets to create an all-
25 season road network. For the fiscal year ending September 30, 2016
26 only, the allocation made under this subdivision shall be reduced
27 by $2,000,000.00, and $2,000,000.00 shall be allocated to the
1 appropriated project as described in section 901 of article XX of
2 2016 PA 268.
3 (4) Beginning October 1, 2015, for the fiscal year ending
4 September 30, 2016 only, the following amounts are appropriated
5 from the fund and the distribution to targeted industries under
6 subsection (3)(a) shall be reduced accordingly:
7 (a) $2,000,000.00 for credit to the state trunk line fund
8 established in section 11 of 1951 PA 51, MCL 247.661, for the
9 purposes of matching available federal-aid highway funds.
10 (b) $2,000,000.00 for credit to the state aeronautics fund
11 established in section 34 of the aeronautics code of the state of
12 Michigan, 1945 PA 327, MCL 259.34, for the purpose of a 1-time
13 airport safety appropriation.
14 (5) Beginning October 1, 2016, for the fiscal year ending
15 September 30, 2017 only, $10,400,000.00 is appropriated from the
16 fund for credit to the state trunk line fund established in section
17 11 of 1951 PA 51, MCL 247.661, for the purpose of road and bridge
18 construction, and the distribution to targeted industries under
19 subsection (3)(a) shall be reduced accordingly.
20 Sec. 13. By December 31 each year the commission shall report
21 to the governor, the house and senate appropriations committees,
22 and the house and senate fiscal agencies the following information
23 regarding this act:
24 (a) The projects funded during the previous fiscal year.
25 (b) The status of projects funded in the immediately preceding
26 fiscal year.
27 (c) The number of jobs created and retained and any other
1 economic benefits of the projects funded and listed under section
2 11(3)(a).9(1)(a).
3 (d) For each project described in section 9(1)(b) that
4 received funds under this act, both of the following:
5 (i) A general description of the project.
6 (ii) The estimated total cost of the project.
7 (e) (d) The
degree to which the projects funded have achieved
8 the objectives of this act.
9 (f) (e) Any
other information considered necessary by the
10 commission for the legislature to evaluate the effectiveness of
11 this act.
12 Enacting section 1. This amendatory act takes effect 90 days
13 after the date it is enacted into law.