HOUSE BILL No. 5839


     April 9, 2002, Introduced by Rep. Newell and referred to the Committee on Tax Policy.


        A bill to amend 1951 PA 51, entitled

   "An act to provide for the classification of all public roads,
   streets, and highways in this state, and for the revision of that
   classification and for additions to and deletions from each clas-
   sification; to set up and establish the Michigan transportation
   fund; to provide for the deposits in the Michigan transportation
   fund of specific taxes on motor vehicles and motor vehicle fuels;
   to provide for the allocation of funds from the Michigan trans-
   portation fund and the use and administration of the fund for
   transportation purposes; to set up and establish the truck safety
   fund; to provide for the allocation of funds from the truck
   safety fund and administration of the fund for truck safety pur-
   poses; to set up and establish the Michigan truck safety commis-
   sion; to establish certain standards for road contracts for cer-
   tain businesses; to provide for the continuing review of trans-
   portation needs within the state; to authorize the state trans-
   portation commission, counties, cities, and villages to borrow
   money, issue bonds, and make pledges of funds for transportation
   purposes; to authorize counties to advance funds for the payment
   of deficiencies necessary for the payment of bonds issued under
   this act; to provide for the limitations, payment, retirement,
   and security of the bonds and pledges; to provide for appropria-
   tions and tax levies by counties and townships for county roads;
   to authorize contributions by townships for county roads; to pro-
   vide for the establishment and administration of the state trunk
   line fund, critical bridge fund, comprehensive transportation
   fund, and certain other funds; to provide for the deposits in the
   state trunk line fund, critical bridge fund, comprehensive


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   transportation fund, and certain other funds of money raised by
   specific taxes and fees; to provide for definitions of public
   transportation functions and criteria; to define the purposes for
   which Michigan transportation funds may be allocated; to provide
   for Michigan transportation fund grants; to provide for review
   and approval of transportation programs; to provide for submis-
   sion of annual legislative requests and reports; to provide for
   the establishment and functions of certain advisory entities; to
   provide for conditions for grants; to provide for the issuance of
   bonds and notes for transportation purposes; to provide for the
   powers and duties of certain state and local agencies and offi-
   cials; to provide for the making of loans for transportation pur-
   poses by the state transportation department and for the receipt
   and repayment by local units and agencies of those loans from
   certain specified sources; and to repeal acts and parts of acts,"

   by amending section 10n (MCL 247.660n) as added by 1987 PA 234.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

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             Sec. 10n.  Funds from the comprehensive transportation fund

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        may be distributed to a trustee, or to the Michigan municipal

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        bond authority as created under the shared credit rating act,

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         Act No. 227 of the Public Acts of 1985, being sections 141.1051

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        to 141.1077 of the Michigan Compiled Laws  1985 PA 227,

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        MCL 141.1051 TO 141.1076, that is authorized to receive the funds

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         pursuant to  UNDER a borrowing resolution adopted by an eligible

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        authority.  The issuance of the notes of an eligible authority in

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        anticipation of payment of proceeds from the comprehensive trans-

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        portation fund shall be authorized by a borrowing resolution of

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        the eligible authority  pursuant to  UNDER the metropolitan

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        transportation authorities act of 1967,  Act No. 204 of the

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        Public Acts of 1967, being sections 124.401 to 124.425 of the

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        Michigan Compiled Laws  1967 PA 204, MCL 124.401 TO 124.426.  The

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        issuance of the notes under this section  shall be  IS NOT

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        subject to  section 11 of chapter III of the municipal finance

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        act, Act No. 202 of the Public Acts of 1943, being section 133.11


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        of the Michigan Compiled Laws  THE REVISED MUNICIPAL FINANCE ACT,

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        2001 PA 34, MCL 141.2101 TO 141.2821, and shall be subject to the

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        prior approval of the state transportation commission.  Failure

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        of the commission to take action within 35 days after receipt of

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        notification from the eligible authority of intent to issue the

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        notes, constitutes approval by the state transportation

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        commission.  The eligible authority may only issue the notes in

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        anticipation of funds to be received during its current fiscal

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        year at any time before the eligible authority's receipt of the

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        funds from the comprehensive transportation fund.  The principal

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        amount of notes for which the funds to be received from the com-

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        prehensive transportation fund are pledged shall not exceed 85%

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        of the amount remaining to be received by the eligible authority

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        from the comprehensive transportation fund in the current fiscal

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        year.  The pledge of 100% of the funds the eligible authority

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        expects to receive from the comprehensive transportation fund

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        shall be secured by a direct transfer of the pledge funds from

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        the comprehensive transportation fund to the trustee or the

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        Michigan municipal bond authority that is authorized to receive

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        the funds by the borrowing resolution adopted by the eligible

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        authority.  The notes of the eligible authority shall not be in

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        any way a debt or a liability of the state and shall not create

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        or constitute any indebtedness, liability, or obligations of the

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        state or be or constitute a pledge of the full faith and credit

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        of the state.  Each note shall contain on its face a statement to

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        the effect that the eligible authority is obligated to pay the

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        principal of and the interest on the note only from funds of or



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        due to the eligible authority and that  the  THIS state is not

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        obligated to pay that principal or interest and that neither the

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        faith in credit nor the taxing power of  the  THIS state is

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        pledged to the payment of the principal of or the interest on the

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        note.  The notes shall mature not more than 13 months from the

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        date of issuance, shall bear interest at a fixed or variable rate

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        or rates of interest per annum, and, in addition to other secur-

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        ity required by this section, may be secured by letter or line of

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        credit issued by a financial institution or as provided in the

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        borrowing resolution.




































   02338'01          Final page.                            JLB