Bill Text: MI SB0912 | 2015-2016 | 98th Legislature | Engrossed
Bill Title: Environmental protection; funding; clean Michigan initiative bond fund; modify criteria for grants and loans to conform to brownfield redevelopment act. Amends secs. 19609, 19610, 19611 & 19612 of 1994 PA 451 (MCL 324.19609 et seq.) & adds sec. 19610a.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Passed) 2016-12-30 - Assigned Pa 0475'16 12/30/16 Addenda [SB0912 Detail]
Download: Michigan-2015-SB0912-Engrossed.html
SB-0912, As Passed Senate, October 18, 2016
SENATE BILL No. 912
April 21, 2016, Introduced by Senator KNEZEK and referred to the Committee on Commerce.
A bill to amend 1994 PA 451, entitled
"Natural resources and environmental protection act,"
by amending sections 19609, 19610, 19611, and 19612 (MCL 324.19609,
324.19610, 324.19611, and 324.19612), sections 19609, 19610, and
19611 as added by 1998 PA 288 and section 19612 as amended by 2014
PA 115, and by adding section 19610a.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 19609. (1) An application for a grant or a loan from the
fund shall be made on a form or in a format prescribed by the
administering state department. The administering state department
may require the applicant to provide any information reasonably
necessary to allow the administering state department to make a
determination required by this part.
(2) Of the funds to be used to provide grants and loans under
section 19608(1)(a)(iv), the following apply:
(a) The department shall accept, and consider for approval,
applications for grants and loans throughout the year.
(b) The department shall make final application decisions
within 90 days after receipt of a complete grant or loan
application.
(c) A complete application includes all of the following:
(i) A description of the proposed eligible activities and the
reasons they should be funded.
(ii) An itemized budget for the proposed eligible activities.
(iii) A schedule for the completion of the proposed eligible
activities.
(iv) The location of the property.
(v) The current ownership and ownership history of the
property.
(vi) The relevant history of the use of the property.
(vii) The current use of the property.
(viii) The existing and proposed future zoning of the
property.
(ix) If the property is not owned by the applicant, a draft of
an enforceable agreement between the property owner and the
applicant that commits the property owner to cooperate with the
applicant, including a commitment to allow access to the property
to complete, at a minimum, the proposed eligible activities.
(x) A description of the property's economic redevelopment
potential.
(xi) For loans, a resolution from the governing body of the
applicant committing to repayment of the loan.
(xii) A letter from the chief executive officer or highest
ranking appointed official indicating that the local unit of
government supports the brownfield project and that the brownfield
project complies with all local zoning and planning ordinances.
(xiii) Any other relevant information the department requires.
Sec.
19610. The administering state department shall not make
a
grant or a loan with money from the fund unless all of the
following
conditions are met:
(a)
The applicant demonstrates that the proposed project is in
compliance
with all applicable state laws and rules or will result
in
compliance with state laws and rules.
(b)
The applicant demonstrates to the administering state
department
the capability to carry out the proposed project.
(c)
The applicant demonstrates to the administering state
department
that there is an identifiable source of funds for the
future
maintenance and operation of the proposed project, if
appropriate.
(d)
Within the last 24 months, the applicant has successfully
undergone
an audit conducted in accordance with generally accepted
auditing
standards.
(e)
Within the last 24 months, the applicant has not had a
grant
from the administering state department revoked or terminated
or
had the administering state department determine that the
applicant
demonstrated an inability to manage a grant.
(1) Upon receipt of a grant or loan application, for funding
provided under section 19608(1)(a)(iv), the department shall review
the application based on the following considerations:
(a) Whether the brownfield project proposed to be funded is
authorized by this part.
(b) Whether the brownfield project is consistent with the
local planning and zoning for the area in which the project is
located.
(c) Whether the brownfield project provides measurable
environmental benefit.
(d) Whether the brownfield project provides measurable
economic benefit or will significantly contribute to the local unit
of government's economic and community redevelopment or the
revitalization of adjacent neighborhoods.
(e) The viability of the redevelopment plan.
(f) The level of public and private commitment and other
resources available for the project.
(g) How the brownfield project relates to a broader economic
and community development plan for the local unit of government as
a whole.
(h) Other criteria that the department considers relevant.
(2) The department shall issue grants under section
19608(1)(a)(iv) for brownfield projects that the department
determines meet the requirements of this part and will contribute
to the revitalization of underutilized properties.
Sec. 19610a. For the funds to be used to provide grants and
loans under section 19608(1)(a)(iv), all of the following apply:
(a) To receive grant or loan funds, approved applicants must
enter into a grant or loan agreement with the department. At a
minimum, the grant or loan agreement shall contain all of the
following:
(i) The approved eligible activities to be undertaken with
grant or loan funds.
(ii) An implementation schedule for the approved eligible
activities.
(iii) Reporting requirements, including, at a minimum, the
following:
(A) The grant or loan recipient shall submit progress status
reports to the department during the implementation of the
brownfield project that include documentation of project costs and
expenditures, at a frequency determined by the department.
(B) The grant or loan recipient shall provide a final report
upon completion of the grant- or loan-funded activities within a
time frame determined by the department.
(iv) If the property is not owned by the grant or loan
recipient, an executed agreement that meets the requirements of
section 19609(2)(c)(ix).
(v) When entering into a loan agreement, the loan recipient
shall provide financial assurance of repayment of the loan
including pledges of revenue sharing, escrow account, letter of
credit, or other acceptable mechanism negotiated with the
department. Use of real property as a means to secure a loan is not
considered an acceptable mechanism. The department is authorized to
include in the loan agreement a provision that permits the release
of the financial assurance in favor of a pledge of the right of
first refusal of the tax increment revenue to the department under
the brownfield redevelopment financing act, 1996 PA 381, MCL
125.2651 to 125.2672, if the brownfield project has been
substantially completed and the annual tax increment being captured
relative to the brownfield project is equal to or greater than 125%
of the annual loan reimbursement payment.
(vi) Other provisions as considered appropriate by the
department.
(b) All eligible activities must be consistent with an
approved grant or loan work plan.
(c) Unless otherwise approved by the director of the
department, only activities carried out and costs incurred after
execution of a grant or loan agreement are eligible.
(d) Grant funds shall be disbursed on a reimbursement basis
upon receipt of appropriate documentation.
(e) Loan funds shall be disbursed in draws based on an
approved work plan, and supporting documentation must be submitted
after expenses are incurred.
(f) The department shall specify documentation requirements
for grants and loans on a form prescribed for requesting
reimbursement or draws.
Sec. 19611. (1) Prior to making a grant or loan with money
from the fund, the administering state department shall consider
the extent to which the making of the grant or loan contributes to
the achievement of a balanced distribution of grants and loans
throughout the state.
(2) In determining whether a grant or a loan is appropriate
under section 19608(1)(a)(iv), the department shall consider
whether the project is likely to be undertaken without state
assistance, the availability of state funds from other sources, the
degree of private sector participation in the type of project under
consideration, and other factors considered important by the
department.
Sec. 19612. (1) A recipient of a grant or a loan made with
money from the fund shall do both of the following:
(a) Keep an accounting of the money spent on the project or
facility
in a generally accepted manner. The accounting shall be is
subject to a postaudit.
(b) Obtain authorization from the administering state
department before implementing a change that significantly alters
the proposed project.
(2) The administering state department may revoke a grant or a
loan made with money from the fund or withhold payment if the
recipient fails to comply with the terms and conditions of the
grant or loan agreement or with the requirements of this part or
the rules promulgated under this part, or with other applicable law
or rules. If a grant or loan is revoked, the administering state
department may recover all funds awarded.
(3) The administering state department may withhold a grant or
a loan until the administering state department determines that the
recipient is able to proceed with the proposed project.
(4) To assure timely completion of a project, the
administering state department may withhold 10% of the grant or
loan amount until the project is complete.
(5) If an approved applicant fails to sign a grant or loan
agreement within 90 days after receipt of a written grant or loan
offer by the administering state department, the administering
state department may cancel the grant or loan offer. The applicant
may not appeal or contest a cancellation pursuant to this
subsection.
(6) The administering state department may terminate a grant
or loan agreement and require immediate repayment of the grant or
loan if the recipient uses grant or loan funds for any purpose
other than for the approved activities specified in the grant or
loan agreement. The administering state department shall provide
the recipient written notice of the termination 30 days prior to
the termination.
(7)
A loan made with money in the fund shall have must be made
on the following terms:
(a) A loan interest rate of not more than 50% of the prime
rate as determined by the administering state department as of the
date of approval of the loan.
(b) Loan recipients shall repay loans in equal annual
installments of principal and interest beginning not later than 5
years
after execution of a loan agreement the first draw of the
loan
and concluding not later than 15 years
after execution of a
loan
agreement.the first draw of
the loan.
(c) A loan recipient shall enter into a loan agreement with
the administering state department.
(d) Upon default of a loan, as determined by the administering
state department, or upon the request of the loan recipient as a
method to repay the loan, the department of treasury shall withhold
from
state payments from payable to the loan recipient in amounts
consistent with the repayment schedule in the loan agreement until
the
loan is repaid. The department of treasury shall deposit these
the
withheld funds or collected money into the fund until the loan
is repaid.
(8) Upon request of a loan recipient and a showing of
financial hardship related to the project that was financed in
whole or in part by the loan, the administering state department
may renegotiate the terms of any outstanding loan, including the
length of the loan, the interest rate, and the repayment terms.
However, the administering state department shall not reduce or
eliminate the amount of the outstanding loan principal. The
department shall report to the legislature the number of loans
refinanced under this subsection, the local unit of government or
authority responsible for each loan refinanced, and the change in
the terms of the loan, as appropriate. This information may be
included in the report prepared by the department under section 16
of the brownfield redevelopment financing act, 1996 PA 381, MCL
125.2666.
(9) Loan payments and interest shall be deposited in the fund.
(10)
Upon default of a loan, as determined by the
administering
state department, or upon the request of the loan
recipient
as a method to repay the loan, the department of treasury
shall
withhold from the loan recipient state payments in amounts
consistent
with the repayment schedule in the loan agreement until
the
loan is repaid. The department of treasury shall deposit these
withheld
funds into the fund until the loan is repaid.
Enacting section 1. This amendatory act takes effect 90 days
after the date it is enacted into law.
Enacting section 2. This amendatory act does not take effect
unless all of the following bills of the 98th Legislature are
enacted into law:
(a) Senate Bill No. 911.
(b) Senate Bill No. 908.
(c) Senate Bill No. 910.
(d) Senate Bill No. 913.
(e) Senate Bill No. 909.
