HOUSE BILL No. 5173

 

July 14, 2009, Introduced by Reps. Donigan, Lipton, Polidori, Byrnes, Robert Jones and Tlaib and referred to the Committee on Intergovernmental and Regional Affairs.

 

     A bill to provide for the establishment of a transit

 

revitalization zone tax increment finance authority; to prescribe

 

the powers and duties of the authority; to authorize the

 

acquisition and disposal of interests in real and personal

 

property; to authorize the creation and implementation of

 

development plans and development areas; to promote improvement in

 

areas where transit projects are to be implemented; to create a

 

board; to prescribe the powers and duties of the board; to

 

authorize the issuance of bonds and other evidences of

 

indebtedness; to authorize the use of tax increment financing; to

 

prescribe powers and duties of certain state officials; to provide

 

for rule promulgation; and to provide for enforcement of the act.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 


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

 

"transit revitalization investment zone act".

 

     Sec. 2. As used in this act:

 

     (a) "Advance" means a transfer of funds made by a municipality

 

to an authority or to another person on behalf of the authority in

 

anticipation of repayment by the authority. Evidence of the intent

 

to repay an advance may include, but is not limited to, an executed

 

agreement to repay, provisions contained in a tax increment

 

financing plan approved prior to the advance, or a resolution of

 

the authority or the municipality.

 

     (b) "Assessed value" means the taxable value as determined

 

under section 27a of the general property tax act, 1893 PA 206, MCL

 

211.27a.

 

     (c) "Authority" means a transit revitalization investment

 

authority created under this act.

 

     (d) "Board" means the governing body of an authority.

 

     (e) "Captured assessed value" means the amount in any 1 year

 

by which the current assessed value of the development area,

 

including the assessed value of property for which specific local

 

taxes are paid in lieu of property taxes, exceeds the initial

 

assessed value. The state tax commission shall prescribe the method

 

for calculating captured assessed value.

 

     (f) "Chief executive officer" means the mayor or city manager

 

of a city, the president or village manager of a village, or the

 

supervisor of a township.

 

     (g) "Fiscal year" means the fiscal year of the authority.

 

     (h) "Governing body" or "governing body of a municipality"

 


means the elected body of a municipality having legislative powers.

 

     (i) "Initial assessed value" means the assessed value of all

 

the taxable property within the boundaries of the development area

 

at the time the ordinance establishing the tax increment financing

 

plan is approved, as shown by the most recent assessment roll of

 

the municipality at the time the resolution is adopted. Property

 

exempt from taxation at the time of the determination of the

 

initial assessed value shall be included as zero. For the purpose

 

of determining initial assessed value, property for which a

 

specific local tax is paid in lieu of a property tax shall not be

 

considered to be property that is exempt from taxation.

 

     (j) "Land use plan" means a plan prepared under former 1921 PA

 

207, or a site plan under the Michigan zoning enabling act, 2006 PA

 

110, MCL 125.3101 to 125.3702.

 

     (k) "Municipality" means a city, village, or township.

 

     Sec. 3. As used in this act:

 

     (a) "Operations" means office maintenance, including salaries

 

and expenses of employees, office supplies, consultation fees,

 

design costs, and other expenses incurred in the daily management

 

of the authority and planning of its activities.

 

     (b) "Parcel" means an identifiable unit of land that is

 

treated as separate for valuation or zoning purposes.

 

     (c) "Public facility" means a street, and any improvements to

 

a street, including street furniture and beautification, park,

 

parking facility, recreational facility, right of way, structure,

 

waterway, bridge, lake, pond, canal, utility line or pipe, or

 

building, including access routes designed and dedicated to use by

 


the public generally, or used by a public agency, that is related

 

to development concentrated around and oriented to transit stations

 

in a manner that promotes transit ridership or passenger rail use.

 

Public facility includes an improvement to a facility used by the

 

public or a public facility as those terms are defined in section 1

 

of 1966 PA 1, MCL 125.1351, if the improvement complies with the

 

barrier free design requirements of the state construction code

 

promulgated under the Stille-DeRossett-Hale single state

 

construction code act, 1972 PA 230, MCL 125.1501 to 125.1531.

 

     (d) "Public transportation agency" means a governmental entity

 

that operates or is authorized to operate intercity or local

 

commuter passenger rail service in this state or a public transit

 

authority created under 1 of the following acts:

 

     (i) The metropolitan transportation authorities act of 1967,

 

1967 PA 204, MCL 124.401 to 124.426.

 

     (ii) The public transportation authorities act, 1986 PA 196,

 

MCL 124.451 to 124.479.

 

     (iii) 1963 PA 55, MCL 124.351 to 124.359.

 

     (iv) The home rule city act, 1909 PA 279, MCL 117.1 to 117.38.

 

     (v) The revenue bond act of 1933, 1933 PA 94, MCL 141.101 to

 

141.140.

 

     (vi) The charter township act, 1947 PA 359, MCL 42.1 to 42.34.

 

     (vii) The urban cooperation act of 1967, 1967 (Ex Sess) PA 7,

 

MCL 124.501 to 124.512.

 

     (e) "Specific local tax" means a tax levied under 1974 PA 198,

 

MCL 207.551 to 207.572, the commercial redevelopment act, 1978 PA

 

255, MCL 207.651 to 207.668, the technology park development act,

 


1984 PA 385, MCL 207.701 to 207.718, the commercial rehabilitation

 

act, 2005 PA 210, MCL 207.841 to 207.856, the neighborhood

 

enterprise zone act, 1992 PA 147, MCL 207.771 to 207.786, the

 

obsolete property rehabilitation act, 2000 PA 146, MCL 125.2781 to

 

125.2797, or 1953 PA 189, MCL 211.181 to 211.182. The initial

 

assessed value or current assessed value of property subject to a

 

specific local tax shall be the quotient of the specific local tax

 

paid divided by the ad valorem millage rate. The state tax

 

commission shall prescribe the method for calculating the initial

 

assessed value and current assessed value of property for which a

 

specific local tax was paid in lieu of a property tax.

 

     (f) "State fiscal year" means the annual period commencing

 

October 1 of each year.

 

     (g) "Tax increment revenues" means the amount of ad valorem

 

property taxes and specific local taxes attributable to the

 

application of the levy of all taxing jurisdictions upon the

 

captured assessed value of real and personal property in the zone.

 

Tax increment revenues do not include any of the following:

 

     (i) Taxes under the state education tax act, 1993 PA 331, MCL

 

211.901 to 211.906.

 

     (ii) Taxes levied by local or intermediate school districts.

 

     (iii) Taxes levied by a library established by 1901 LA 359.

 

     (iv) Ad valorem property taxes attributable either to a portion

 

of the captured assessed value shared with taxing jurisdictions

 

within the jurisdictional area of the authority or to a portion of

 

value of property that may be excluded from captured assessed value

 

or specific local taxes attributable to the ad valorem property

 


taxes.

 

     (v) Ad valorem property taxes excluded by the tax increment

 

financing plan of the authority from the determination of the

 

amount of tax increment revenues to be transmitted to the authority

 

or specific local taxes attributable to the ad valorem property

 

taxes.

 

     (vi) Ad valorem property taxes exempted from capture under this

 

section or specific local taxes attributable to the ad valorem

 

property taxes.

 

     (vii) Ad valorem property taxes specifically levied for the

 

payment of principal and interest of obligations approved by the

 

electors or obligations pledging the unlimited taxing power of the

 

local governmental unit or specific taxes attributable to those ad

 

valorem property taxes.

 

     (viii) Ad valorem taxes captured on property in a zone by any of

 

the following authorities if the taxes were captured on the date

 

that the property became subject to a tax increment financing plan

 

under this section by any of the following authorities:

 

     (A) A downtown development authority created under 1975 PA

 

197, MCL 125.1651 to 125.1681.

 

     (B) A water resource improvement tax increment finance

 

authority created under the water resource tax increment finance

 

authority act, 2008 PA 94, MCL 125.1771 to 125.1794.

 

     (C) A tax increment finance authority under the tax increment

 

finance authority act, 1980 PA 450, MCL 125.1801 to 125.1830.

 

     (D) A local development finance authority created under the

 

local development finance authority act, 1986 PA 281, MCL 125.2151

 


to 125.2174.

 

     (E) A brownfield redevelopment finance authority created under

 

the brownfield redevelopment financing act, 1996 PA 381, MCL

 

125.2651 to 125.2672.

 

     (F) A historical neighborhood tax increment finance authority

 

created under the historical neighborhood tax increment finance

 

authority act, 2004 PA 530, MCL 125.2841 to 125.2866.

 

     (G) A corridor improvement authority created under the

 

corridor improvement authority act, 2005 PA 280, MCL 125.2871 to

 

125.2899.

 

     (H) A neighborhood improvement authority created under the

 

neighborhood improvement authority act, 2007 PA 61, MCL 125.2911 to

 

125.2932.

 

     (h) "Transit-oriented development" means development that is

 

concentrated around and oriented to transit stations in a manner

 

that promotes transit ridership or passenger rail use. Transit-

 

oriented development includes, but is not limited to, single

 

projects and collections of projects, including mixed use projects

 

on a neighborhood scale.

 

     (i) "Zone" means a transit revitalization investment zone

 

created in accordance with this act.

 

     Sec. 4. (1) Except as otherwise provided in this subsection, a

 

municipality may establish multiple authorities. A parcel of

 

property shall not be included in more than 1 authority created

 

under this act.

 

     (2) An authority is a public body corporate that may sue and

 

be sued in any court of this state. An authority possesses all the

 


powers necessary to carry out its purpose. The enumeration of a

 

power in this act shall not be construed as a limitation upon the

 

general powers of an authority.

 

     Sec. 5. (1) If the governing body of a municipality or a

 

public transportation agency determines that it is necessary for

 

the best interests of the public to promote development or promote

 

greater public transportation options in a transit revitalization

 

zone, the governing body may, by resolution, declare its intention

 

to create and provide for the operation of an authority within the

 

boundaries of a zone.

 

     (2) In the resolution of intent, the governing body shall set

 

a date for a public hearing on the adoption of a proposed ordinance

 

creating the authority and designating the boundaries of the zone.

 

Notice of the public hearing shall be published twice in a

 

newspaper of general circulation in the municipality, not less than

 

20 or more than 40 days before the date of the hearing. Not less

 

than 20 days before the hearing, the governing body proposing to

 

create the authority shall also mail notice of the hearing to the

 

property taxpayers of record in the proposed zone and to the

 

governing body of each taxing jurisdiction levying taxes that would

 

be subject to capture if the authority is established and a tax

 

increment financing plan is approved. Failure of a property

 

taxpayer to receive the notice does not invalidate these

 

proceedings. Notice of the hearing shall be posted in at least 20

 

conspicuous and public places in the proposed zone not less than 20

 

days before the hearing. The notice shall state the date, time, and

 

place of the hearing and shall describe the boundaries of the

 


proposed zone. The zone shall consist of parcels that are not

 

greater than 1/2 mile in distance from a transit station. A

 

citizen, taxpayer, or property owner of the municipality or an

 

official from a taxing jurisdiction with millage that would be

 

subject to capture has the right to be heard in regard to the

 

establishment of the authority and the boundaries of the proposed

 

zone. The governing body of the municipality shall not incorporate

 

land into the zone not included in the description contained in the

 

notice of public hearing, but it may eliminate described lands from

 

the development area in the final determination of the boundaries.

 

     (3) Not less than 60 days after the public hearing, if the

 

governing body of the municipality intends to proceed with the

 

establishment of the authority it shall adopt, by majority vote of

 

its members, an ordinance establishing the authority and

 

designating the boundaries of the zone within which the authority

 

shall exercise its powers. The adoption of the ordinance is subject

 

to any applicable statutory or charter provisions in respect to the

 

approval or disapproval by the chief executive or other officer of

 

the municipality and the adoption of an ordinance over his or her

 

veto. This ordinance shall be filed with the secretary of state

 

promptly after its adoption and shall be published at least once in

 

a newspaper of general circulation in the municipality.

 

     (4) The governing body of the municipality may alter or amend

 

the boundaries of the zone to include or exclude lands from the

 

zone in the same manner as adopting the ordinance creating the

 

authority.

 

     (5) A municipality that has created an authority may enter

 


into an agreement with an adjoining municipality that has created

 

an authority to jointly operate and administer those authorities

 

under an interlocal agreement under the urban cooperation act of

 

1967, 1967 (Ex Sess) PA 7, MCL 124.501 to 124.512.

 

     Sec. 6. The authority shall consult with affected

 

municipalities, counties, public transportation agencies, private

 

transportation providers, and any other entity that the authority

 

considers necessary to designate a zone. The authority may conduct

 

a planning study and may designate a zone in advance of

 

implementation of a public transit service associated with a zone.

 

The authority shall enter into an agreement with the affected

 

municipalities and public transportation agencies to create a zone.

 

The authority shall give the local public transportation agency

 

that primarily services the municipality the zone is located in the

 

right of the first refusal. The agreement shall indicate the

 

geographic boundaries of the zone, shall define the activities

 

implemented to enhance development in the zone, and shall include

 

specific actions taken by the parties, including financial

 

participation, to help establish the zone. In addition to the

 

elements described in this section, the authority may utilize any

 

of the resources and powers it has under this act.

 

     Sec. 7. If a zone is part of an area annexed to or

 

consolidated with another municipality, the authority managing that

 

zone shall become an authority of the annexing or consolidated

 

municipality. Obligations of that authority incurred under a

 

development or tax increment plan, agreements related to a

 

development or tax increment plan, and bonds issued under this act

 


shall remain in effect following the annexation or consolidation.

 

     Sec. 8. (1) The authority shall be under the supervision and

 

control of a board. Except as otherwise provided in this

 

subsection, the size of the board and the nominating process for

 

board members shall be established through an agreement between the

 

affected municipalities and the affected local public

 

transportation agencies. Board members shall be appointed by the

 

chief executive officer of the affected municipalities, subject to

 

approval by the governing body of the affected municipalities. At

 

least 1 member of the board shall be nominated by the public

 

transportation agencies that primarily serve the affected

 

municipalities. A member shall hold office until a successor is

 

appointed. Each member shall serve for a term of 4 years. Members

 

shall not receive compensation, but shall be reimbursed for actual

 

and necessary expenses. The chairperson of the board shall be

 

elected by the board.

 

     (2) Before assuming the duties of office, a member shall

 

qualify by taking and subscribing to the constitutional oath of

 

office.

 

     (3) The proceedings and rules of the board are subject to the

 

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

 

shall adopt rules governing its procedure and the holding of

 

regular meetings, subject to the approval of the governing body.

 

Special meetings may be held if called in the manner provided in

 

the rules of the board.

 

     (4) After having been given notice and an opportunity to be

 

heard, a member of the board may be removed for cause by the

 


governing body.

 

     (5) All expense items of the authority shall be publicized

 

monthly and the financial records shall always be open to the

 

public.

 

     (6) A writing prepared, owned, used, in the possession of, or

 

retained by the board in the performance of an official function is

 

subject to the freedom of information act, 1976 PA 442, MCL 15.231

 

to 15.246.

 

     Sec. 9. (1) The board may employ and fix the compensation of a

 

director, subject to the approval of the governing body of the

 

municipality. The director shall serve at the pleasure of the

 

board. A member of the board is not eligible to hold the position

 

of director. Before beginning his or her duties, the director shall

 

take and subscribe to the constitutional oath, and furnish bond, by

 

posting a bond in the sum determined in the ordinance establishing

 

the authority payable to the authority for use and benefit of the

 

authority, approved by the board, and filed with the municipal

 

clerk. The premium on the bond shall be considered an operating

 

expense of the authority, payable from funds available to the

 

authority for expenses of operation. The director shall be the

 

chief executive officer of the authority. Subject to the approval

 

of the board, the director shall supervise and be responsible for

 

the preparation of plans and the performance of the functions of

 

the authority in the manner authorized by this act. The director

 

shall attend the meetings of the board and shall provide to the

 

board and to the governing body of the municipality a regular

 

report covering the activities and financial condition of the

 


authority. If the director is absent or disabled, the board may

 

designate a qualified person as acting director to perform the

 

duties of the office. Before beginning his or her duties, the

 

acting director shall take and subscribe to the oath, and furnish

 

bond, as required of the director. The director shall furnish the

 

board with information or reports governing the operation of the

 

authority as the board requires.

 

     (2) The board may employ and fix the compensation of a

 

treasurer, who shall keep the financial records of the authority

 

and who, together with the director, shall approve all vouchers for

 

the expenditure of funds of the authority. The treasurer shall

 

perform all duties delegated to him or her by the board and shall

 

furnish bond in an amount prescribed by the board.

 

     (3) The board may employ and fix the compensation of a

 

secretary, who shall maintain custody of the official seal and of

 

records, books, documents, or other papers not required to be

 

maintained by the treasurer. The secretary shall attend meetings of

 

the board and keep a record of its proceedings and shall perform

 

other duties delegated by the board.

 

     (4) The board may retain legal counsel to advise the board in

 

the proper performance of its duties. The legal counsel shall

 

represent the authority in actions brought by or against the

 

authority.

 

     (5) The board may employ other personnel considered necessary

 

by the board.

 

     Sec. 10. The employees of an authority shall be eligible to

 

participate in municipal retirement and insurance programs of the

 


municipality as if they were civil service employees except that

 

the employees of an authority are not civil service employees.

 

     Sec. 11. The board may do any of the following:

 

     (a) Authorize expenditure of tax increment revenues obtained

 

under this act for the operating costs of a public transportation

 

agency servicing the zone.

 

     (b) Plan and propose the construction, renovation, repair,

 

remodeling, rehabilitation, restoration, preservation, or

 

reconstruction of a public facility that may be necessary or

 

appropriate to the execution of a plan that, in the opinion of the

 

board, aids in the establishment of a zone. The board is encouraged

 

to develop a plan that conserves the natural features, reduces

 

impervious surfaces, and uses landscaping and natural features to

 

reflect the predevelopment site.

 

     (c) Plan, propose, and implement an improvement to a public

 

facility within the zone to comply with the barrier free design

 

requirements of the state construction code promulgated under the

 

Stille-DeRossett-Hale single state construction code act, 1972 PA

 

230, MCL 125.1501 to 125.1531.

 

     (d) Develop long-range plans for zones within the district.

 

     (e) Implement any plan of development for transit

 

revitalization in the development area necessary to achieve the

 

purposes of this act in accordance with the powers of the authority

 

granted by this act.

 

     (f) Make and enter into contracts necessary or incidental to

 

the exercise of its powers and the performance of its duties.

 

     (g) Acquire by purchase or otherwise, on terms and conditions

 


and in a manner the authority considers proper or own, convey, or

 

otherwise dispose of, or lease as lessor or lessee, land and other

 

property, real or personal, or rights or interests in the property,

 

that the authority determines is reasonably necessary to achieve

 

the purposes of this act, and to grant or acquire licenses,

 

easements, and options.

 

     (h) Improve land and construct, reconstruct, rehabilitate,

 

restore and preserve, equip, clear, improve, maintain, and repair

 

any public facility, building, and any necessary or desirable

 

appurtenances to those buildings, as determined by the authority to

 

be reasonably necessary to achieve the purposes of this act, within

 

the zone for the use, in whole or in part, of any public or private

 

person or corporation, or a combination thereof.

 

     (i) Fix, charge, and collect fees, rents, and charges for the

 

use of any facility, building, or property under its control or any

 

part of the facility, building, or property, and pledge the fees,

 

rents, and charges for the payment of revenue bonds issued by the

 

authority.

 

     (j) Lease, in whole or in part, any facility, building, or

 

property under its control.

 

     (k) Accept grants and donations of property, labor, or other

 

things of value from a public or private source.

 

     (l) Acquire and construct public facilities.

 

     Sec. 12. The authority is an instrumentality of a political

 

subdivision for purposes of 1972 PA 227, MCL 213.321 to 213.332.

 

     Sec. 13. (1) The activities of the authority shall be financed

 

from 1 or more of the following sources:

 


     (a) Donations to the authority for the performance of its

 

functions.

 

     (b) Money borrowed and to be repaid as authorized by sections

 

14 and 15.

 

     (c) Revenues from any property, building, or facility owned,

 

leased, licensed, or operated by the authority or under its

 

control, subject to the limitations imposed upon the authority by

 

trusts or other agreements.

 

     (d) Proceeds of a tax increment financing plan established

 

under sections 16 to 18.

 

     (e) Proceeds from a special assessment district created as

 

provided by law.

 

     (f) Money obtained from other sources approved by the

 

governing body of the municipality or otherwise authorized by law

 

for use by the authority or the municipality to finance a

 

development program.

 

     (2) Money received by the authority and not covered under

 

subsection (1) shall immediately be deposited to the credit of the

 

authority, subject to disbursement under this act. Except as

 

provided in this act, the municipality shall not obligate itself,

 

and shall not be obligated, to pay any sums from public funds,

 

other than money received by the municipality under this section,

 

for or on account of the activities of the authority.

 

     Sec. 14. The authority may borrow money and issue its

 

negotiable revenue bonds under the revenue bond act of 1933, 1933

 

PA 94, MCL 141.101 to 141.140.

 

     Sec. 15. (1) The authority may with approval of the local

 


governing body borrow money and issue its revenue bonds or notes to

 

finance all or part of the costs of transit revitalization

 

development improvements in connection with either of the

 

following:

 

     (a) The implementation of an improvement plan in the zone.

 

     (b) The refund, or refund in advance, of bonds or notes issued

 

under this section.

 

     (2) Any of the following may be financed by the issuance of

 

revenue bonds or notes:

 

     (a) The cost of purchasing, acquiring, constructing,

 

improving, enlarging, extending, or repairing property in

 

connection with the implementation of an improvement plan in the

 

zone.

 

     (b) Any engineering, architectural, legal, accounting, or

 

financial expenses.

 

     (c) The costs necessary or incidental to the borrowing of

 

money.

 

     (d) Interest on the bonds or notes during the period of

 

construction.

 

     (e) A reserve for payment of principal and interest on the

 

bonds or notes.

 

     (f) A reserve for operation and maintenance until sufficient

 

revenues have developed.

 

     (3) The authority may secure the bonds and notes by mortgage,

 

assignment, or pledge of the property and any money, revenues, or

 

income received in connection with the property.

 

     (4) A pledge made by the authority is valid and binding from

 


the time the pledge is made. The money or property pledged by the

 

authority immediately is subject to the lien of the pledge without

 

a physical delivery, filing, or further act. The lien of a pledge

 

is valid and binding against parties having claims of any kind in

 

tort, contract, or otherwise, against the authority, whether or not

 

the parties have notice of the lien. Neither the resolution, the

 

trust agreement, nor any other instrument by which a pledge is

 

created must be filed or recorded to be enforceable.

 

     (5) Bonds or notes issued under this section are exempt from

 

all taxation in this state, and the interest on the bonds or notes

 

is exempt from all taxation in this state, notwithstanding that the

 

interest may be subject to federal income tax.

 

     (6) The municipality is not liable on bonds or notes of the

 

authority issued under this section, and the bonds or notes are not

 

a debt of the municipality. The bonds or notes shall contain on

 

their face a statement to that effect.

 

     (7) The bonds and notes of the authority may be invested in by

 

all public officers, state agencies and political subdivisions,

 

insurance companies, banks, savings and loan associations,

 

investment companies, and fiduciaries and trustees, and may be

 

deposited with and received by all public officers and the agencies

 

and political subdivisions of this state for any purpose for which

 

the deposit of bonds is authorized.

 

     Sec. 16. (1) If the authority determines that it is necessary

 

for the achievement of the purposes of this act, the authority

 

shall prepare and submit a tax increment financing plan to the

 

governing body of the municipality. The plan shall include a

 


development plan as provided in section 19, a detailed explanation

 

of the tax increment procedure, the maximum amount of bonded

 

indebtedness to be incurred, and the duration of the program, and

 

shall be in compliance with section 17. The plan shall contain a

 

statement of the estimated impact of tax increment financing on the

 

assessed values of all taxing jurisdictions in which the zone is

 

located. The plan may provide for the use of part or all of the

 

captured assessed value, but the portion intended to be used by the

 

authority shall be clearly stated in the tax increment financing

 

plan. The authority or municipality may exclude from captured

 

assessed value growth in property value resulting solely from

 

inflation. The plan shall set forth the method for excluding growth

 

in property value resulting solely from inflation.

 

     (2) Approval of the tax increment financing plan shall comply

 

with the notice, hearing, and disclosure provisions of section 21.

 

If the development plan is part of the tax increment financing

 

plan, only 1 hearing and approval procedure is required for the 2

 

plans together.

 

     (3) Before the public hearing on the tax increment financing

 

plan, the governing body shall provide a reasonable opportunity to

 

the taxing jurisdictions levying taxes subject to capture to meet

 

with the governing body. The authority shall fully inform the

 

taxing jurisdictions of the fiscal and economic implications of the

 

proposed development area. The taxing jurisdictions may present

 

their recommendations at the public hearing on the tax increment

 

financing plan. The authority may enter into agreements with the

 

taxing jurisdictions, public transportation agencies that operate

 


in the zone, and the governing body of the municipality in which

 

the zone is located to share a portion of the captured assessed

 

value of the development area. If an authority enters into an

 

agreement with a public transportation agency to share a portion of

 

the captured assessed value under this subsection, that agreement

 

shall be in writing and shall contain all of the following:

 

     (a) A provision that the captured assessed value may be used

 

for operating expenses.

 

     (b) A provision on how the authority will facilitate

 

applicants who are seeking credits under section 438 of the

 

Michigan business tax act, 2007 PA 36, MCL 208.1438.

 

     (4) Before a tax increment financing plan is implemented, the

 

authority shall enter into a contract with the public

 

transportation agency that operates the transit station in the

 

zone. The contract shall include, but not be limited to, terms

 

regarding the distribution of revenue, the allocation of

 

responsibility for maintenance and upkeep of the transit station

 

and associated facilities, and the use of the facilities.

 

     (5) A tax increment financing plan may be modified if the

 

modification is approved by the governing body upon notice and

 

after public hearings and agreements as are required for approval

 

of the original plan.

 

     (6) A governing body in a taxing jurisdiction levying ad

 

valorem property taxes otherwise subject to capture and that levies

 

a separate millage for public library purposes may, at the request

 

of the public library board, exempt that separate millage from

 

capture by adopting a resolution to that effect and filing a copy

 


with the clerk of the municipality proposing to create the

 

authority. The resolution shall take effect when filed with the

 

clerk and remains effective until a copy of a resolution rescinding

 

that resolution is filed with that clerk.

 

     (7) Before a tax increment financing plan is implemented, the

 

governing body in a taxing jurisdiction that is a community college

 

levying ad valorem property taxes that would otherwise be subject

 

to capture may exempt its taxes from capture by adopting a

 

resolution to that effect and filing a copy with the clerk of the

 

municipality proposing to create the authority. The resolution

 

shall take effect when filed with the clerk and remains effective

 

until a copy of a resolution rescinding that resolution is filed

 

with that clerk.

 

     Sec. 17. (1) The municipal and county treasurers shall

 

transmit tax increment revenues to the authority.

 

     (2) The authority shall expend the tax increment revenues

 

received for the improvement program only under the terms of the

 

tax increment financing plan. Unused funds shall revert

 

proportionately to the respective taxing bodies. Tax increment

 

revenues shall not be used to circumvent existing property tax

 

limitations. The governing body of the municipality may abolish the

 

tax increment financing plan if it finds that the purposes for

 

which it was established are accomplished. However, the tax

 

increment financing plan shall not be abolished until the principal

 

of, and interest on, bonds issued under section 18 have been paid

 

or funds sufficient to make the payment have been segregated.

 

     (3) Annually the authority shall submit to the governing body

 


of the municipality and the state tax commission a report on the

 

status of the tax increment financing account. The report shall

 

include the following:

 

     (a) The amount and source of revenue in the account.

 

     (b) The amount in any bond reserve account.

 

     (c) The amount and purpose of expenditures from the account.

 

     (d) The amount of principal and interest on any outstanding

 

bonded indebtedness.

 

     (e) The initial assessed value of the project area.

 

     (f) The captured assessed value retained by the authority.

 

     (g) The tax increment revenues received.

 

     (h) The number of public facilities developed.

 

     (i) The number of zone improvements made.

 

     (j) A brief description of each zone improvement made within

 

the district.

 

     (k) Any additional information the governing body considers

 

necessary.

 

     Sec. 18. (1) By resolution of its governing body, the

 

authority may authorize, issue, and sell tax increment bonds

 

subject to the limitations set forth in this subsection to finance

 

the development program of the tax increment financing plan. The

 

tax increment bonds issued by the authority under this subsection

 

shall pledge solely the tax increment revenues of a zone in which

 

the project is located or a zone from which tax increment revenues

 

may be used for this project, or both. In addition or in the

 

alternative, the bonds issued by the authority under this

 

subsection may be secured by any other revenues identified in

 


section 13 as sources of financing for activities of the authority

 

that the authority shall specifically pledge in the resolution.

 

However, except as otherwise provided in this section, the full

 

faith and credit of the municipality shall not be pledged to secure

 

bonds issued under this subsection. The bond issue may include a

 

sum sufficient to pay interest on the tax increment bonds until

 

full development of tax increment revenues from the project and

 

also a sum to provide a reasonable reserve for payment of principal

 

and interest on the bonds. The resolution authorizing the bonds

 

shall create a lien on the tax increment revenues and other

 

revenues pledged by the resolution that shall be a statutory lien

 

and shall be a first lien subject only to liens previously created.

 

The resolution may provide the terms upon which additional bonds

 

may be issued of equal standing and parity of lien as to the tax

 

increment revenues and other revenues pledged under the resolution.

 

Bonds issued under this subsection that pledge revenue received

 

under section 16 for repayment of the bonds are subject to the

 

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

 

141.2821.

 

     (2) The municipality, by majority vote of the members of its

 

governing body, may make a limited tax pledge to support the

 

authority's tax increment bonds or notes or, if authorized by the

 

voters of the municipality, may pledge its unlimited tax full faith

 

and credit for the payment of the principal of and interest on the

 

authority's tax increment bonds or notes.

 

     Sec. 19. (1) If a board decides to finance a project in a

 

development area by the use of revenue bonds as authorized in

 


section 14 or tax increment financing as authorized in sections 16,

 

17, and 18, it shall prepare an improvement plan.

 

     (2) The improvement plan shall contain all of the following:

 

     (a) The designation of boundaries of the zone in relation to

 

highways, streets, streams, lakes, other bodies of water, or

 

otherwise.

 

     (b) The location and extent of existing streets and other

 

public facilities within the zone, designating the location,

 

character, and extent of the categories of public and private land

 

uses then existing and proposed for the zone, including

 

residential, recreational, commercial, industrial, educational, and

 

other uses, and including a legal description of the zone.

 

     (c) A description of existing improvements in the zone to be

 

demolished, repaired, or altered, a description of any repairs and

 

alterations, and an estimate of the time required for completion.

 

     (d) The location, extent, character, and estimated cost of the

 

improvements including rehabilitation contemplated for the zone and

 

an estimate of the time required for completion.

 

     (e) A statement of the construction or stages of construction

 

planned, and the estimated time of completion of each stage.

 

     (f) A description of any parts of the zone to be left as open

 

space and the use contemplated for the space.

 

     (g) A description of any portions of the zone that the

 

authority desires to sell, donate, exchange, or lease to or from

 

the municipality and the proposed terms.

 

     (h) A description of desired zoning changes and changes in

 

streets, street levels, intersections, or utilities.

 


     (i) An estimate of the cost of the development, a statement of

 

the proposed method of financing the development, and the ability

 

of the authority to arrange the financing.

 

     (j) Designation of the person or persons, natural or

 

corporate, to whom all or a portion of the development is to be

 

leased, sold, or conveyed in any manner and for whose benefit the

 

project is being undertaken if that information is available to the

 

authority.

 

     (k) The procedures for bidding for the leasing, purchasing, or

 

conveying in any manner of all or a portion of the development upon

 

its completion, if there is no express or implied agreement between

 

the authority and persons, natural or corporate, that all or a

 

portion of the development will be leased, sold, or conveyed in any

 

manner to those persons.

 

     (l) The requirement that amendments to an approved improvement

 

plan or tax increment plan must be submitted by the authority to

 

the governing body for approval or rejection.

 

     (m) The transit revitalization improvements that will be made

 

in the zone.

 

     (n) Other material that the authority, local public agency, or

 

governing body considers pertinent.

 

     (o) Based on consultation with the affected state and federal

 

authorities, an identification of the permits the board believes

 

necessary to complete the proposed public facility and an

 

explanation of how the proposed public facility will meet the

 

requirements necessary for issuance of each permit.

 

     Sec. 20. (1) The governing body, before adoption of an

 


ordinance approving an improvement plan or tax increment financing

 

plan, shall hold a public hearing on the improvement plan. Notice

 

of the time and place of the hearing shall be given by publication

 

twice in a newspaper of general circulation designated by the

 

municipality, the first of which shall be not less than 20 days

 

before the date set for the hearing. Notice of the hearing shall be

 

posted in at least 20 conspicuous and public places in the

 

development area not less than 20 days before the hearing. Notice

 

shall also be mailed to all property taxpayers of record in the

 

development area and to the governing body of each taxing

 

jurisdiction levying taxes that would be subject to capture if the

 

tax increment financing plan is approved not less than 20 days

 

before the hearing.

 

     (2) Notice of the time and place of hearing on an improvement

 

plan shall contain all of the following:

 

     (a) A description of the proposed zone in relation to

 

highways, streets, streams, or otherwise.

 

     (b) A statement that maps, plats, and a description of the

 

development plan, including the method of relocating families and

 

individuals who may be displaced from the area, are available for

 

public inspection at a place designated in the notice.

 

     (c) A statement that all aspects of the improvement plan will

 

be open for discussion at the public hearing.

 

     (d) Other information that the governing body considers

 

appropriate.

 

     (3) At the time set for the hearing, the governing body shall

 

provide an opportunity for interested persons to speak and shall

 


receive and consider communications in writing. The hearing shall

 

provide the fullest opportunity for expression of opinion, for

 

argument on the merits, and for consideration of documentary

 

evidence pertinent to the improvement plan. The governing body

 

shall make and preserve a record of the public hearing, including

 

all data presented at the hearing.

 

     Sec. 21. The governing body after a public hearing on the

 

improvement plan or the tax increment financing plan, or both, with

 

notice given under section 20, shall determine whether the

 

improvement plan or tax increment financing plan constitutes a

 

public purpose. If it determines that the improvement plan or tax

 

increment financing plan constitutes a public purpose, it shall by

 

ordinance approve or reject the plan, or approve it with

 

modification, based on the following considerations:

 

     (a) The findings and recommendations of a zone citizens

 

council, if a zone citizens council was formed.

 

     (b) The plan meets the requirements under section 19(2).

 

     (c) The proposed method of financing the development is

 

feasible and the authority has the ability to arrange the

 

financing.

 

     (d) The development is reasonable and necessary to carry out

 

the purposes of this act.

 

     (e) The land included within the zone to be acquired is

 

reasonably necessary to carry out the purposes of the plan and of

 

this act in an efficient and economically satisfactory manner.

 

     (f) The improvement plan is in reasonable accord with the land

 

use plan of the municipality.

 


     (g) Public services, such as fire and police protection and

 

utilities, are or will be adequate to service the project area.

 

     (h) Changes in zoning, streets, street levels, intersections,

 

and utilities are reasonably necessary for the project and for the

 

municipality.

 

     Sec. 22. (1) The director of the authority shall submit a

 

budget to the board for the operation of the authority for each

 

fiscal year before the beginning of the fiscal year. The budget

 

shall be prepared in the manner and contain the information

 

required of municipal departments. After review by the board, the

 

budget shall be submitted to the governing body. The governing body

 

must approve the budget before the board may adopt the budget.

 

Unless authorized by the governing body or this act, funds of the

 

municipality shall not be included in the budget of the authority.

 

     (2) The governing body of the municipality may assess a

 

reasonable pro rata share of the funds for the cost of handling and

 

auditing the funds against the funds of the authority, other than

 

those committed, which shall be paid annually by the board pursuant

 

to an appropriate item in its budget.

 

     Sec. 23. An authority that has completed the purposes for

 

which it was organized shall be dissolved by ordinance of the

 

governing body. The property and assets of the authority remaining

 

after the satisfaction of the obligations of the authority belong

 

to the municipality.

 

     Sec. 24. (1) The state tax commission may institute

 

proceedings to compel enforcement of this act.

 

     (2) The state tax commission may promulgate rules necessary

 


for the administration of this act under the administrative

 

procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328.