April 25, 2006, Introduced by Reps. Jones, Garfield, Vander Veen, Pastor, Gosselin, Palmer, Marleau, Stahl, Hoogendyk, Drolet, Hildenbrand and Gaffney and referred to the Committee on Government Operations.
A bill to require all governmental entities to provide
financial statements regarding commercial activity performed by a
governmental entity; and to require the financial statements to be
audited.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 1. As used in this act:
(a) "Commercial activity" means performing services or
providing goods that can normally be obtained from private
enterprise.
(b) "Government agency" or "agency" means the state, a county,
city, village, township, educational institution, or a department,
agency, or subdivision thereof.
(c) "Private enterprise" means an individual, firm,
partnership, joint venture, corporation, association, or any other
legal entity engaging in the manufacturing, processing, sale,
offering for sale, rental, leasing, delivery, dispensing,
distributing, or advertising of goods or services for profit.
Sec. 2. (1) For all commercial activity by a government
agency, annual financial statements of all income and expenses of
the commercial activities shall be maintained separately and on the
same basis as all other financial statements of the government
agency. Income from monetary assets of a government agency shall
not be shown as income of commercial activities but shall be shown
as income of a government agency.
(2) The financial statements of commercial activities shall
not include any income from the government agency. Grants shall not
be included as income of the commercial activities but shall be
shown as income to the government agency.
(3) The financial statements of commercial activities shall
include proportionate amounts of common expenses shared with other
government agencies, including, but not limited to, utility costs,
supplies, repair and replacement costs, insurance of all types,
employee compensation, employee benefits, payroll taxes, debt
service, and depreciation of all types.
(4) The financial statements of a government agency and the
commercial activities shall be audited and certified as correct by
a certified public accountant and auditor within 120 days after the
end of the annual accounting period and when certified shall be
released to the public.