This afternoon the House passed Senate Bill 922, a bill to extend the sunset for bonding for other post employment benefits (OPEB) and the costs of switching from defined benefit to defined contribution. This is an option for communities with a AA credit rating.

The sunset will be extended to December 31, 2015. The League has been pushing for an additional change to allow communities with an A rating or better to use this option if they purchase bond insurance. Thus far we have not been successful in getting this amendment.

The legislation now goes to the Senate for concurrence.

Samantha Harkins is the Director of State Affairs for the League handling municipal finance issues.  She can be reached at sharkins@mml.org or 517-908-0306.

Rep. Eileen Kowall has introduced legislation to require more transparency and limit some TIF fund operations of Downtown Development Authorities.  HB 5856 (Kowall DDA Act Legislation (4)) is significantly different than Draft 1 we posted about last week.  HB 5856 would do the following:

1. Definition of Public Services and states a DDA can spend money on increased levels of public services that the municipality is not providing within the downtown district.
2. Adds language stating the intent of the legislature in the DDA act of what a downtown is:
   A. DDAs intended to revitalize and develop downtown areas with intensive private and public capital investment that are densely settled commercial cores that serve as social, economic and cultural centers.
   B. Downtowns are multifunctional geographically contiguous spaces where residents can shop, dine, live, worship, access government, and be entertained, and that are compact and walkable and serve as a defining characteristic for the community’s overall sense of place.
3. Adds abilities within a development district such as demolish, reconstruct, develop, redevelop, operate, repair, maintain, improve, etc.  Also adds in environmental remediation of property as an eligible activity.
4. States all documents for the DDA (budget, audit, minutes, plans, etc) must be on either the DDAs website or the muni’s website.
5. Requires an annual meeting of the DDA to which other taxing jurisdictions are invited to and allowed to speak on DDA specific issues.
6. TIF reports that are currently submitted to state must also be submitted to the other taxing jurisdictions.
7. Adds significant that must be a part of the TIF report including:
   Value of projects
   Number of businesses established and left area
   Other funds aside from TIF used for projects
   Job growth
   Growth in creation of businesses and existing businesses
   Vacancy rates
   Residential growth
   Increased activity from events sponsored by DDA
   Evidence of the reversal of blight or deterioration
8. TIF revenues need to be used within 5 years of receipt or be turned back over to the other taxing jurisdictions.  However, that 5 years could be moved to longer than 5 but no more than 15 if the TIF plan states why the accumulation is needed, a timeframe for when it will be expended and for what it will be expended.  Additionally, TIF revenues may be accumulated as required pursuant to terms of bonds issued.
9. Penalty for noncompliance: If State Tax Commission notifies the authority of failure to comply, the authority may not capture any TIF except what is needed for bonds or other obligations until they are back in compliance.

At this time, there are no additional opt outs or resetting of baselines.  However, it is extremely important that you all are contacting your representative regarding this legislation and letting them know how detrimental an opt out or resetting of baseline would be for economic development in your community.

This legislation will be taken up in House Commerce committee tomorrow morning at 10:30 am.  The intent is to then have one more committee hearing on this next week Wednesday where they pass it out and then potentially pass the full House next week Thursday (essentially the legislatures last day until after the election).

If you are interested in testifying on this issue, please let me know!

Please feel free to contact me with any questions!

 Nikki Brown is a legislative associate for the League handling economic development and land use issues.  She can be reached at nbrown@mml.org or 517-908-0305.

Earlier this year the Michigan Supreme Court held in People v. Cunningham that a court may impose costs in a criminal case only if those costs are authorized by statute. This decision has a huge impact on courts across Michigan including our district courts.

Last week the House passed House Bill 5785, legislation that would allow a court to impose any reasonable cost on a defendant found guilty of a crime. Unfortunately on the House floor an amendment was added that would sunset the legislation in two years. We’ll be working to remove the sunset in the Senate.

Reasonable costs include salaries and benefits of court personnel; goods and services necessary for operation of the court; and/or necessary expenses for the operation and maintenance of court buildings and facilities.

The bill requires the court to make available to the general public and the defendant information about any costs, fines or assessments imposed beginning June 18, 2014.

The legislation now goes to the Senate for consideration.

Samantha Harkins is the Director of State Affairs for the League handling municipal finance issues.  She can be reached at sharkins@mml.org or 517-908-0306.

This afternoon the Senate Finance Committee heard testimony on Senate Bills 1038, 1039 and 1040, bills that make changes to the tax appeal process and the Michigan Tax Tribunal Act.

The League has a lot of concerns regarding the way the Tax Tribunal has been valuing property and the losses sustained by our local communities; however, this legislation does not make changes that would address those concerns.

Among our concerns is that the bills in some instances bypass the local boards of review which would be more cumbersome for taxpayers as well as local units of government.

Additionally SB 1039 amends the Tax Tribunal Act to remove assessors and appraisers from the Tribunal, which would be made up only of attorneys under the bills.

In an attempt to “streamline” the process, the bills instead take away local control and make the process more cumbersome for both taxpayers and local units of government. The committee did not vote on the bills, and the sponsor expressed a willingness to work on amendments.

Samantha Harkins is the Director of State Affairs for the League handling municipal finance issues.  She can be reached at sharkins@mml.org or 517-908-0306.

House Bill 5397, a bill creating the Municipal Utility Residential Clean Energy Program Act, received a committee hearing in the Senate Energy and Technology committee today.  This would enable municipalities that own electric utilities to establish a program to help provide financing to residential property owners for energy efficiency projects. This is modeled after the PACE Act.

This legislation passed the full House prior to the legislative recess in June on a 108 to 2 vote.

This is an idea that was brought to Rep. Joe Haveman’s attention by the city of Holland who would like the opportunity to create a program such as this.

Samantha Harkins is the Director of State Affairs for the League handling municipal finance issues.  She can be reached at sharkins@mml.org or 517-908-0306.

Today, the Senate Energy and Technology reported out of committee SB 493, a bill dealing with amateur radio operations.  As it was introduced, it had a significant impact on local control and zoning.  However, through a workgroup process, the bill was made significantly better (substitute found here: SB 493 S2 (3)) and now mirrors the Federal regulations that our local communities are already required to adhere to.

It also discusses an advisory council made up of amateur radio industry folks and local government folks so anyone with a question can seek feedback and research from this group either at the industry level or the community level.

We appreciate the work the bill sponsor and his office put into the legislation and hearing our concerns from a local government perspective. Also, a big thank you to Tim Wolff, village manager of Lake Isabella, for attending the workgroup meetings with me and providing valuable feedback.

Nikki Brown is a legislative associate for the League handling economic development and land use issues.  She can be reached at nbrown@mml.org or 517-908-0305.