SB-0358, As Passed Senate, May 12, 2005

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SUBSTITUTE FOR

 

SENATE BILL NO. 358

 

 

 

 

 

 

 

 

 

 

 

     A bill to create and provide for the operation of the life

 

science investment authority; to provide for the creation and

 

appointment of a board to govern the authority and to prescribe its

 

powers and duties; to provide for the powers and duties of the

 

authority; to extend protections against certain liabilities to the

 

authority; to provide for the issuance of certain bonds, notes, and

 

other obligations; to promote economic growth; to exempt property,

 

income, and operations of an authority from tax; and to provide an

 

appropriation.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 1. This act shall be known and may be cited as the "life

 

science investment authority act".

 

     Sec. 2. As used in this act:


 

     (a) "Authority" means the life science investment authority

 

created under section 3.

 

     (b) "Board" means the life science investment authority board

 

described in section 4.

 

     (c) "Department" means the department of treasury.

 

     (d) "Fund" means the life science investment fund created in

 

section 18.

 

     (e) "Governmental agency" means a department, agency, or

 

commission of this state or of a county, city, village, or township

 

of this state.

 

     (f) "Investment management company" means the entity hired by

 

the board to make qualified investments from the fund.

 

     (g) "Life science products" means a product that requires food

 

and drug administration approval or registration prior to its

 

introduction in the marketplace and is a drug or medical device as

 

defined by the federal food, drug, and cosmetic act, 21 USC 301 to

 

399.

 

     (h) "Local unit of government" means a city, county, township,

 

or village.

 

     (i) "Michigan life science pipeline" or "pipeline" means

 

members of the Michigan life science pipeline described in section

 

78 of the Michigan strategic fund act, 1984 PA 270, MCL 125.2078.

 

     (j) "Person" means an individual, partnership, corporation,

 

limited liability company, association, governmental entity, or

 

other legal entity.

 

     (k) "Qualified agreement" means an agreement between a

 

qualified business and the investment management company. A


 

qualified agreement shall include, but is not limited to, all of

 

the following:

 

     (i) A condition that the qualified business match the qualified

 

investment, which shall not exceed 10% of the total need to

 

complete work on the requested round. A qualified investment may be

 

made in follow-on rounds.

 

     (ii) A condition that the investment management company ensures

 

a return on this state's investment similar to other investors in

 

the qualified business as determined by the investment management

 

company.

 

     (iii) A condition that the qualified businesses utilize members

 

of the Michigan life science pipeline to develop their life science

 

product, if the services needed are readily available as determined

 

by the investment management company.

 

     (iv) A condition that a qualified investment will not be used

 

to engage in or support human cloning as defined in section 16274

 

of the public health code, 1978 PA 368, MCL 333.16274, or stem cell

 

research with embryonic tissue.

 

     (l) "Qualified business" is a business entity that develops,

 

markets, or commercializes life science products.

 

     (m) "Qualified investments" means a loan or investment in a

 

qualified business under the terms of a qualified agreement.

 

     Sec. 3. (1) There is created by this act a public body

 

corporate and politic known as the life science investment

 

authority. The authority shall be located within the department.

 

     (2) The authority shall exercise its prescribed statutory

 

powers, duties, and functions independently of the state treasurer.


 

The budgeting, procurement, and related administrative functions of

 

the authority shall be performed under the direction and

 

supervision of the state treasurer.

 

     (3) The authority may contract with the department for the

 

purpose of maintaining the rights and interests of the authority.

 

     (4) The accounts of the authority may be subject to annual

 

financial audits by the state auditor general. Records of the

 

authority shall be maintained according to generally accepted

 

accounting principles.

 

     Sec. 4. (1) The authority created under this act shall be

 

governed by the life science investment authority board, which

 

shall consist of 7 board members who are residents of this state.

 

Of the members first appointed under subsection (2)(c), 2 shall be

 

appointed for a term of 2 years and 3 shall be appointed for a term

 

of 3 years.

 

     (2) The members of the board shall be as follows:

 

     (a) The state treasurer, or his or her designee.

 

     (b) The chief executive officer of the Michigan economic

 

development corporation, or his or her designee.

 

     (c) Five other members appointed by the governor by and with

 

the advice and consent of the senate who are not employed by this

 

state. Members appointed shall have knowledge, skill, and

 

experience as follows:

 

     (i) At least 1 member in science.

 

     (ii) At least 1 member in venture capital investments.

 

     (iii) At least 1 member in business in the life science field.

 

     (iv) At least 1 member in the business of bringing life science


 

products to market.

 

     (3) Upon appointment to the board under subsection (2) and

 

upon the taking and filing of the constitutional oath of office

 

prescribed in section 1 of article XI of the state constitution of

 

1963, a member of the board shall enter the office and exercise the

 

duties of the office.

 

     (4) After the first appointment, each member shall serve a

 

term of 4 years, except that a person appointed to fill a vacancy

 

shall be appointed for the balance of the unexpired term. The

 

governor shall fill a vacancy in the office by appointment in the

 

same manner as an appointment under subsection (2). A member of the

 

board shall hold office until a successor has been appointed and

 

qualified. A member of the board is eligible for reappointment.

 

     (5) Members of the board and officers and employees of the

 

authority are considered public servants subject to 1968 PA 317,

 

MCL 15.321 to 15.330, and 1968 PA 318, MCL 15.301 to 15.310. A

 

member of the board or an officer, employee, or agent of the

 

authority shall discharge the duties of the position in a

 

nonpartisan manner, in good faith, in the best interests of the

 

authority, and with the degree of diligence, care, and skill that

 

an ordinarily prudent person would exercise under similar

 

circumstances in a like position. In discharging duties of the

 

office, a member of the board or an officer, employee, or agent of

 

the authority, when acting in good faith, may rely upon a majority

 

vote of a quorum of the board, upon the opinion of counsel for the

 

authority, upon the report of an independent appraiser selected

 

with reasonable care by the board, or upon financial statements of


 

the authority represented to the member of the board, officer,

 

employee, or agent to be correct by the officer of the authority

 

having charge of its books or accounts or stated in a written

 

report by the auditor general or a certified public accountant or a

 

firm of accountants to fairly reflect the financial condition of

 

the authority.

 

     (6) The board shall elect a chairperson, vice-chairperson,

 

secretary, and any additional officers of the board considered

 

necessary by the board from among its members. All elected officers

 

of the board shall be elected annually by the board. Members of the

 

board shall serve without compensation, but shall be reimbursed for

 

actual and necessary expenses.

 

     Sec. 5. (1) Upon the appointment of at least 5 members of the

 

board under section 4, the board may hold its first meeting. The

 

first meeting of the board shall be held not more than 60 days

 

after the date the authority is created.

 

     (2) The board shall organize and adopt its own policies,

 

procedures, schedule of regular meetings, and a regular meeting

 

date, place, and time. The board shall conduct all business at

 

public meetings held in compliance with the open meetings act, 1976

 

PA 267, MCL 15.261 to 15.275. Public notice of the time, date, and

 

place of each meeting shall be given in the manner required by the

 

open meetings act, 1976 PA 267, MCL 15.261 to 15.275.

 

     (3) A record or portion of a record, material, or other data

 

received, prepared, used, or retained by the authority in

 

connection with an application for a qualified investment that

 

relates to financial or proprietary information submitted by the


 

applicant that is considered by the applicant and acknowledged by

 

the authority as confidential shall not be subject to the

 

disclosure requirements of the freedom of information act, 1976 PA

 

442, MCL 15.231 to 15.246. A designee of the authority shall make

 

the determination as to whether the authority acknowledges as

 

confidential any financial or proprietary information submitted by

 

the applicant and considered by the applicant as confidential.

 

Unless considered proprietary information, the authority shall not

 

acknowledge routine financial information as confidential. If the

 

designee of the authority determines that information submitted to

 

the authority is financial or proprietary information and is

 

confidential, the designee of the authority shall release a written

 

statement, subject to disclosure under the freedom of information

 

act, 1976 PA 442, MCL 15.231 to 15.246, which states all of the

 

following:

 

     (a) The name of the person requesting that the information

 

submitted be confidential as financial or proprietary information.

 

     (b) That the information submitted was determined by the

 

designee of the authority to be confidential as financial or

 

proprietary information.

 

     (c) A broad nonspecific overview of the financial or

 

proprietary information determined to be confidential.

 

     (4) The authority shall not disclose financial or proprietary

 

information not subject to disclosure pursuant to subsection (3)

 

without consent of the applicant submitting the information. As

 

used in this section, "financial or proprietary information" means

 

information that has not been publicly disseminated or is


 

unavailable from other sources, the release of which might cause

 

the applicant significant competitive harm.

 

     (5) A board may act only by resolution. A majority of the

 

members of the board then in office, or of any committee of the

 

board, shall constitute a quorum for the transaction of business.

 

The board shall meet in person or by means of electronic

 

communication devices that enable all participants in the meeting

 

to communicate with each other. A vote of a majority of the members

 

of the board serving at the time of the vote is necessary to

 

approve the issuance by the authority of bonds or to approve or

 

amend the annual budget of the authority. Except as otherwise

 

provided in this act, a vote of the majority of the board members

 

present at a meeting at which a quorum is present constitutes the

 

action of the board.

 

     (6) Before the beginning of each fiscal year, the board shall

 

prepare a budget containing an itemized statement of the estimated

 

current operational expenses for the operation of the authority,

 

the amount necessary to pay the principal and interest of any

 

outstanding bonds or other obligations of the authority maturing

 

during the ensuing fiscal year or that have previously matured and

 

are unpaid, an estimate of the revenue of the authority from all

 

sources for the ensuing fiscal year, and other amounts necessary to

 

further the purposes of this act. The authority's budget shall be

 

funded by proceeds derived from gifts, grants, loans,

 

appropriations, and other aids from any person or the federal

 

government, this state, or a local government or any agency of the

 

federal government, this state, or a local government.


 

     Sec. 6. (1) The board may appoint a person, other than a

 

member of the board, to serve as director of the authority, to whom

 

the authority may delegate any of its administrative powers.

 

     (2) Subject to the approval of the board, the director shall

 

supervise, and be responsible for, all of the following:

 

     (a) The performance of the functions of the authority under

 

this act.

 

     (b) A regular report describing the activities and financial

 

condition of the authority.

 

     (c) The issuance of bonds, notes, or other obligations

 

approved by the board.

 

     (d) All other activities or functions that the board considers

 

necessary.

 

     (3) The board may employ legal and technical experts, private

 

consultants and engineers, accountants, scientists, and other

 

agents or employees for rendering professional and technical

 

assistance and advice as may be necessary. The authority shall

 

determine the qualifications, duties, and compensation of those it

 

employs.

 

     (4) The board shall contract with an investment management

 

company to make qualified investments in qualified businesses under

 

terms of qualified agreements as determined by the board. The board

 

shall require the investment management company to do all of the

 

following:

 

     (a) Make early seed investments in qualified businesses for

 

life science products.

 

     (b) Utilize peer review of the science involved in the life


 

science product before entering into a qualified investment.

 

     (c) Coordinate with the pipeline to ensure that members of the

 

pipeline are providing services at prices that are competitive

 

within the industry.

 

     (d) Work with the board to ensure that the purposes of this

 

act are accomplished.

 

     (e) Report not less than quarterly to the board as determined

 

by the board.

 

     (f) Any other requirements determined by the board.

 

     Sec. 7. Except as otherwise provided in this act, the

 

authority may do all things necessary to implement the purposes of

 

this act, including, but not limited to, all of the following:

 

     (a) Adopt, amend, and repeal bylaws for the regulation of its

 

affairs and the conduct of its business.

 

     (b) Adopt an official seal and alter the seal at the pleasure

 

of the board.

 

     (c) Sue and be sued in its own name and plead and be

 

impleaded.

 

     (d) Solicit and accept gifts, grants, loans, and other

 

assistance from any person or the federal, the state, or a local

 

government or any agency of the federal, the state, or a local

 

government or participate in any other way in any federal, state,

 

or local government program.

 

     (e) Finance and otherwise aid in the development and

 

commercialization of life science products.

 

     (f) Make loans and investments; guarantee and insure loans,

 

leases, bonds, notes, or other indebtedness, whether public or


 

private; and issue letters of credit.

 

     (g) Borrow money and issue bonds and notes to finance part or

 

all of the costs of developing and commercializing life science

 

products and secure those bonds and notes by mortgage, assignment,

 

or pledge of any of its money, revenues, income, and properties.

 

     (h) Procure insurance against any loss in connection with the

 

authority's property, assets, or activities.

 

     (i) Invest any money of the authority, at the board's

 

discretion, in any bond, note, or other obligation determined

 

proper by the board, and name and use depositories for its money.

 

     (j) Contract for goods and services and engage personnel as

 

necessary and engage the services of private consultants, managers,

 

legal counsel, engineers, accountants, scientists, and auditors for

 

rendering professional financial assistance and advice payable out

 

of any money of the authority.

 

     (k) Charge, impose, and collect fees and charges in connection

 

with any transaction and provide for reasonable penalties for

 

delinquent payment of fees or charges.

 

     (l) Indemnify and procure insurance indemnifying any members of

 

the board or employees of the board from personal loss or

 

accountability from liability asserted by a person on the bonds or

 

notes of the authority or from any personal liability or

 

accountability by reason of the issuance of the bonds, notes,

 

insurance, or guarantees; by reason of acquisition, construction,

 

ownership, or operation of a project; or by reason of any other

 

action taken or the failure to act by the authority.

 

     (m) Promulgate rules pursuant to the administrative procedures


 

act of 1969, 1969 PA 306, MCL 24.201 to 24.328, necessary to carry

 

out the purposes of this act.

 

     (n) Do all other things necessary to promote and finance

 

development and commercialization of life science products in this

 

state.

 

     Sec. 8. (1) The authority may authorize and issue its bonds or

 

notes payable solely from revenues or funds available to the

 

authority. Bonds and notes of the authority are not a debt or

 

liability of this state and do not create or constitute any

 

indebtedness, liability, or obligations of this state or constitute

 

a pledge of the full faith or credit of this state. All authority

 

bonds and notes shall be payable solely from revenues or funds

 

pledged or available for their payment as authorized in this act.

 

Each bond and note shall contain on its face a statement to the

 

effect that the authority is obligated to pay the principal of and

 

the interest on the bond or note only from revenue or funds of the

 

authority pledged for the payment of principal and interest and

 

that this state is not obligated to pay that principal and interest

 

and that neither the full faith and credit nor the taxing power of

 

this state is pledged to the payment of the principal of or the

 

interest on the bond or note.

 

     (2) All expenses incurred in carrying out this section shall

 

be payable solely from revenues or funds provided or to be provided

 

under this act. This act does not authorize the authority to incur

 

any indebtedness or liability on behalf of or payable by this

 

state.

 

     (3) Bonds and notes issued under this act are not subject to


 

the revised municipal finance act, 2001 PA 34, MCL 141.2101 to

 

141.2821.

 

     (4) The issuance of bonds and notes under this section is

 

subject to the agency financing reporting act, 2002 PA 470, MCL

 

129.171 to 129.177.

 

     Sec. 9. (1) The authority may issue from time to time bonds or

 

notes in principal amounts the authority considers necessary to

 

provide funds for any purpose, including, but not limited to, all

 

of the following:

 

     (a) The payment, funding, or refunding of the principal of,

 

interest on, or redemption premiums on bonds or notes issued by the

 

authority whether the bonds or notes or interest to be funded or

 

refunded has or has not become due.

 

     (b) The establishment or increase of reserves to secure or to

 

pay authority bonds or notes or interest on those bonds or notes.

 

     (c) The payment of interest on the bonds or notes for a period

 

as the authority determines.

 

     (d) The payment of all other costs or expenses of the

 

authority incident to and necessary or convenient to carry out its

 

authorized purposes and powers.

 

     (2) The bonds or notes of the authority shall not be a general

 

obligation of the authority but shall be payable solely from the

 

revenues or funds, or both, pledged to the payment of the principal

 

of and interest on the bonds or notes as provided in the resolution

 

authorizing the bonds or notes.

 

     (3) The bonds or notes of the authority:

 

     (a) Shall be authorized by resolution of the authority.


 

     (b) Shall bear the date or dates of issuance.

 

     (c) May be issued as either tax-exempt bonds or notes or

 

taxable bonds or notes for federal income tax purposes.

 

     (d) Shall be serial bonds, term bonds, or term and serial

 

bonds.

 

     (e) Shall mature at a time or times not exceeding 20 years

 

from the date of issuance.

 

     (f) May provide for sinking fund payments.

 

     (g) May provide for redemption at the option of the authority

 

at any time for any reason or reasons.

 

     (h) May provide for redemption at the option of the bondholder

 

at any time for any reason.

 

     (i) Shall bear interest at a fixed or variable rate or rates

 

of interest per year or at no interest.

 

     (j) Shall be registered bonds, coupon bonds, or both.

 

     (k) May contain a conversion feature.

 

     (l) May be transferable.

 

     (m) Shall be in the form, denomination or denominations, and

 

with such other provisions and terms as are determined necessary or

 

beneficial by the authority.

 

     Sec. 10. (1) The authority may authorize and approve an

 

insurance contract, an agreement for a line of credit, a letter of

 

credit, a commitment to purchase notes or bonds, an agreement to

 

remarket bonds or notes, or any other transaction to provide

 

security to assure timely payment of a bond or note.

 

     (2) The authority may authorize payment from the proceeds of

 

the notes or bonds, or other funds available, of the costs of


 

issuance, including, but not limited to, fees for placement,

 

charges for insurance, letters of credit, lines of credit,

 

remarketing agreements, reimbursement agreements, or purchase or

 

sales agreements or commitments, or agreements to provide security

 

to assure timely payment of notes or bonds.

 

     (3) The authority shall not invest or otherwise approve an

 

insurance contract, an agreement for a line of credit, a letter of

 

credit, a commitment to purchase notes or bonds, an agreement to

 

remarket bonds or notes, or an issuance of bonds or notes or any

 

other transaction that results in a combined liability of the

 

authority in excess of $50,000,000.00.

 

     Sec. 11. Within limitations contained in the issuance or

 

authorization resolution of the authority, the authority may

 

authorize a member of the board, the director, or other officer of

 

the authority to do 1 or more of the following:

 

     (a) Sell and deliver and receive payment for notes or bonds.

 

     (b) Refund notes or bonds by the delivery of new notes or

 

bonds whether or not the notes or bonds to be refunded have matured

 

or are subject to redemption.

 

     (c) Deliver notes or bonds, partly to refund notes or bonds

 

and partly for any other authorized purpose.

 

     (d) Buy notes or bonds that are issued and resell those notes

 

or bonds.

 

     (e) Approve interest rates or methods for fixing interest

 

rates, prices, discounts, maturities, principal amounts,

 

denominations, dates of issuance, interest payment dates,

 

redemption rights, at the option of the authority or the holder,


 

the place of delivery and payment, and other matters and procedures

 

necessary to complete the transactions authorized.

 

     (f) Direct the investment of any and all funds of the

 

authority.

 

     (g) Approve the terms of a contract and execute and deliver

 

the contract subject to the restrictions of this part.

 

     (h) Approve the terms of any insurance contract, agreement for

 

a line of credit, a letter of credit, a commitment to purchase

 

notes or bonds, an agreement to remarket bonds or notes, an

 

agreement to manage payment, revenue, or interest rate exposure, or

 

any other transaction to provide security to assure timely payment

 

of a bond or note.

 

     (i) Perform any power, duty, function, or responsibility of

 

the authority.

 

     Sec. 12. A resolution authorizing bonds or notes may provide

 

for all of the following that shall be part of the contract with

 

the holders of the bonds or notes:

 

     (a) A pledge to any payment or purpose all or any part of

 

authority revenues or assets to which its right then exists or may

 

later come to exist, of money derived from the revenues or assets,

 

and of the proceeds of bonds or notes or of an issue of bonds or

 

notes, subject to any existing agreements with bondholders or

 

noteholders.

 

     (b) A pledge of a loan, grant, or contribution from the

 

federal, state, or local government.

 

     (c) The establishment and setting aside of reserves or sinking

 

funds and the regulation and disposition of reserves or sinking


 

funds subject to this act.

 

     (d) Authorization for and limitations on the issuance of

 

additional bonds or notes for the purposes provided for in the

 

resolution and the terms upon which additional notes or bonds may

 

be issued and secured.

 

     (e) The procedure, if any, by which the terms of a contract

 

with noteholders or bondholders may be amended or abrogated, the

 

number of noteholders or bondholders who are required to consent to

 

the amendment or abrogation, and the manner in which consent may be

 

given.

 

     (f) A contract with the bondholders as to the custody,

 

collection, securing, investment, and payment of any money of the

 

authority. Money of the authority and deposits of money may be

 

secured in the manner determined by the authority. Banks and trust

 

companies may give security for the deposits.

 

     (g) Vest in a trustee, or a secured party, the property,

 

income, revenue, receipts, rights, remedies, powers, and duties in

 

trust or otherwise as the authority determines necessary or

 

appropriate to adequately secure and protect noteholders and

 

bondholders or to limit or abrogate the right of the holders of

 

bonds or notes of the authority to appoint a trustee under this act

 

or to limit the rights, powers, and duties of the trustee.

 

     (h) Provide the trustee, the noteholders, or the bondholder's

 

remedies that may be exercised if the authority fails or refuses to

 

comply with this act or defaults in an agreement made with the

 

holders of an issue of bonds or notes, which may include, but are

 

not limited to, the following:


 

     (i) By mandamus or other action or proceeding at law or in

 

equity, to enforce the rights of the bondholders or noteholders and

 

require the authority to carry out any other agreement with the

 

holders of those notes or bonds and to perform the duties of the

 

authority under this act.

 

     (ii) Bring action upon the notes or bonds.

 

     (iii) By action, require the authority to account as if it were

 

the trustee of an express trust for the holders of the notes or

 

bonds.

 

     (iv) By action in equity, enjoin any acts or things that may be

 

unlawful or in violation of the rights of the holders of the notes

 

or bonds.

 

     (v) Declare the notes or bonds due and payable and, if all

 

defaults shall be made good, then, as permitted by the resolution,

 

annul that declaration and its consequences.

 

     (i) Any other matters of like or different character that in

 

any way affect the security or protection of the bonds or notes.

 

     Sec. 13. A pledge made by the authority shall be valid and

 

binding from the time the pledge is made. The money or property

 

pledged and then received by the authority immediately is subject

 

to the lien of the pledge without physical delivery or further act.

 

The lien of a pledge is valid and binding as against parties having

 

claims of any kind in tort, contract, or otherwise against the

 

authority and is valid and binding as against the transfers of

 

money or property pledged, irrespective of whether parties have

 

notice. The resolution, the trust agreement, or any other

 

instrument by which a pledge is created is not required to be


 

recorded in order to establish and perfect a lien or security

 

interest in the property pledged.

 

     Sec. 14. The members of the board and any person executing

 

bonds or notes issued as provided in this act and any person

 

executing any agreement on behalf of the authority is not

 

personally liable on the bonds or notes by reason of their

 

issuance.

 

     Sec. 15. The authority may hold, cancel, or resell authority

 

bonds or notes subject to or in accordance with an agreement with

 

holders of authority bonds or notes.

 

     Sec. 16. This state pledges to and agrees with the holders of

 

bonds or notes issued in accordance with this act that this state

 

shall not limit or restrict the rights vested in the authority by

 

this act to fulfill the terms of an agreement made with the holders

 

of authority bonds or notes or in any way impair the rights or

 

remedies of the holders of the bonds or notes of the authority

 

until the bonds and notes, together with interest on the bonds or

 

notes and interest on any unpaid installments of interest, and all

 

costs and expenses in connection with an action or proceedings by

 

or on behalf of those holders are fully met, paid, and discharged.

 

     Sec. 17. Notwithstanding any restriction in any other law,

 

this state and a public officer, local unit of government, agency

 

of this state or a local unit of government, an intergovernmental

 

entity created under the laws of this state; a bank, trust company,

 

savings bank and institution, savings and loan association,

 

investment company, or other person carrying on a banking business;

 

an insurance company, insurance association, or other person


 

carrying on an insurance business; or an executor, administrator,

 

guardian, trustee, or other fiduciary may legally invest funds

 

belonging to them or within their control in bonds or notes issued

 

under this act, and authority bonds or notes shall be authorized

 

security for public deposits.

 

     Sec. 18. (1) The life science investment fund is created under

 

the jurisdiction and control of the authority and may be

 

administered for the general operations of the authority and to

 

secure any notes and bonds of the authority.

 

     (2) The authority may receive money or other assets from any

 

source for deposit into the fund. The authority shall credit to the

 

fund interest and earnings from fund investments.

 

     (3) Money in the fund at the close of the fiscal year shall

 

remain in the fund and shall not lapse to the general fund.

 

     (4) The authority shall expend money from the fund only for

 

the authorized purposes provided in this act.

 

     Sec. 19. The authority created under this act shall be exempt

 

from and shall not be required to pay taxes on property, both real

 

and personal, belonging to the authority, which is used for a

 

public or governmental purpose. Property of the authority is public

 

property devoted to an essential public or governmental function

 

and purpose. The authority's income and operation, including bonds

 

or notes issued by the authority or the interest and income derived

 

from the bonds or notes, are exempt from all taxes and special

 

assessments of this state or a political subdivision of this state.

 

     Sec. 20. This act shall be construed liberally to effectuate

 

the legislative intent and its purposes. All powers granted shall


 

be cumulative and not exclusive and shall be broadly interpreted to

 

effectuate the intent and purposes and not as a limitation of

 

powers.

 

     Sec. 21. There is appropriated from the general fund for

 

initial implementation costs for this act the sum of $100,000.00.

 

     Enacting section 1.  This act does not take effect unless

 

Senate Bill No. 359 of the 93rd Legislature is enacted into law.