February 3, 2005, Introduced by Rep. Stakoe and referred to the Committee on Transportation.
A bill to amend 1951 PA 51, entitled
"An act to provide for the classification of all public roads,
streets, and highways in this state, and for the revision of that
classification and for additions to and deletions from each
classification; to set up and establish the Michigan transportation
fund; to provide for the deposits in the Michigan transportation
fund of specific taxes on motor vehicles and motor vehicle fuels;
to provide for the allocation of funds from the Michigan
transportation fund and the use and administration of the fund for
transportation purposes; to set up and establish the truck safety
fund; to provide for the allocation of funds from the truck safety
fund and administration of the fund for truck safety purposes; to
set up and establish the Michigan truck safety commission; to
establish certain standards for road contracts for certain
businesses; to provide for the continuing review of transportation
needs within the state; to authorize the state transportation
commission, counties, cities, and villages to borrow money, issue
bonds, and make pledges of funds for transportation purposes; to
authorize counties to advance funds for the payment of deficiencies
necessary for the payment of bonds issued under this act; to
provide for the limitations, payment, retirement, and security of
the bonds and pledges; to provide for appropriations and tax levies
by counties and townships for county roads; to authorize
contributions by townships for county roads; to provide for the
establishment and administration of the state trunk line fund,
local bridge fund, comprehensive transportation fund, and certain
other funds; to provide for the deposits in the state trunk line
fund, critical bridge fund, comprehensive transportation fund, and
certain other funds of money raised by specific taxes and fees; to
provide for definitions of public transportation functions and
criteria; to define the purposes for which Michigan transportation
funds may be allocated; to provide for Michigan transportation fund
grants; to provide for review and approval of transportation
programs; to provide for submission of annual legislative requests
and reports; to provide for the establishment and functions of
certain advisory entities; to provide for conditions for grants; to
provide for the issuance of bonds and notes for transportation
purposes; to provide for the powers and duties of certain state and
local agencies and officials; to provide for the making of loans
for transportation purposes by the state transportation department
and for the receipt and repayment by local units and agencies of
those loans from certain specified sources; and to repeal acts and
parts of acts,"
by amending sections 10o and 12 (MCL 247.660o and 247.662), section
10o as amended by 2000 PA 188 and section 12 as amended by 2002 PA
498.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 10o. (1) Twenty-three to twenty-seven percent of the DOT-
FHWA highway research, planning, and construction federal funds
appropriated to this state from the federal government for road and
bridge construction shall be allocated to programs administered by
local jurisdictions after deduction of the following:
(a) Funds that are specifically allocated at the federal level
to the state or local jurisdictions.
(b) Funds allocated by the department to the state and to
local jurisdictions through a competitive process.
(2) Federal aid excluded from the calculation of funding
allocated to programs administered by local jurisdictions in
subsection (1) includes, but is not limited to, congestion
mitigation and air quality funds, federal bridge funds,
transportation enhancement funds, funds distributed at the
discretion of the United States secretary of transportation, and
congressionally designated funds.
(3) The funds shall be distributed to eligible local agencies
for transportation purposes in a manner consistent with state and
federal law.
(4) It is the intent of the legislature that federal aid to
highways allocated to local jurisdictions in subsection (1) be
distributed in a manner that produces a 25% average allocation of
applicable funds to programs for local jurisdictions in each fiscal
year through the fiscal year ending September 30, 2000. Beginning
in the fiscal year ending September 30, 1999, the average
allocation of applicable federal aid to highway funds to programs
for local jurisdictions shall be the average of the amount
distributed to local jurisdictions under subsection (1) and
similarly calculated distributions in each succeeding fiscal year.
The average allocation percentage described in this subsection
shall be adjusted to reflect any voluntary agreements made by the
department with local jurisdictions regarding the state buyout of
local federal aid.
(5) Funds intended for distribution to a county road
commission under this section pursuant to a federally approved
grant application from a city, village, or township shall be
distributed to the city, village, or township upon the department's
approval. The department shall approve distribution of the funds
upon a determination that the grant application meets federal
guidelines.
Sec. 12. (1) The amount distributed to the county road
commissions shall be returned to the county treasurers in the
manner, for the purposes, and under the terms and conditions
specified in this section. The department and the county road
association of Michigan shall jointly develop incentives for
counties to establish statewide purchasing pools for the more
efficient use of Michigan transportation funds.
(2) Each county road commission shall be reimbursed in an
amount up to $10,000.00 per year for the sum paid to a licensed
professional engineer employed or retained by the county road
commission in the previous year. The sum shall be returned to each
county road commission certified by the state transportation
department as complying with this subsection regarding the
employment of an engineer.
(3) An amount equal to 1% of the total amount returned to the
county road commissions from the Michigan transportation fund
during the prior calendar year shall be withheld annually from the
counties' November monthly distribution provided for in section 17,
and the amount shall be returned to the county road commissions for
snow removal purposes as provided in section 12a.
(4) An amount equal to 10% of the total amount returned to the
county road commissions from the Michigan transportation fund shall
be returned to each county road commission having county primary,
or county local road, or both, mileage in the urban areas as
determined pursuant to section 12b. This sum shall be distributed
pursuant to section 12b. The return shall be in addition to the
amounts provided in subsections (6) and (7) and for the purposes
stated in those subsections.
(5) An amount equal to 4% of the total amount returned to the
county road commissions from the Michigan transportation fund shall
be returned to the county road commissions in the same percentages
as provided in subsection (7). All money returned to the county
road commissions as provided in this subsection shall be expended
by the county road commissions for the preservation, construction,
acquisition, and extension of county local road systems and shall
be in addition to the amounts provided in subsection (7).
(6) Seventy-five percent of the remainder of the total amount
to be returned to the counties shall be expended by each county
road commission for the preservation, construction, acquisition,
and extension of the county primary road system, including the
acquisition of a necessary right of way for the system, work
incidental to the system, and a roadside park or motor parkway
appurtenant to the system, and shall be returned to the counties as
follows:
(a) Three-fourths of the amount in proportion to the amount
received within the respective county during the 12 months next
preceding the date of each monthly distribution, as specific taxes
upon registered motor vehicles under the Michigan vehicle code,
1949 PA 300, MCL 257.1 to 257.923.
(b) One-tenth of the amount in the same proportion that the
total mileage in the county primary road system of each county
bears to the total mileage in all of the county primary road
systems of the state.
(c) One eighty-third of the remaining 15% of the amount to
each county.
(7) The balance of the remainder of the total amount to be
returned to counties shall be expended by each county road
commission for the preservation, construction, acquisition, and
extension of the county local road system as defined by this act,
including the acquisition of a necessary right of way for the
system, work incidental to the system, and a roadside park or motor
parkway appurtenant to the system, and shall be returned to the
counties as follows:
(a) Sixty-five percent of the amount in the same proportion
that the total mileage in the county local road system of each
county bears to the total mileage in all of the county local road
systems of the state.
(b) Thirty-five percent of the amount in the same proportion
that the total population outside of incorporated municipalities in
each county bears to the total population outside of incorporated
municipalities in all of the counties of the state, according to
the most recent statewide federal census as certified at the
beginning of the state fiscal year.
(8) Money deposited in, or becoming a part of the county road
funds of a board of county road commissioners shall be expended
first for the payment of principal and interest on the bonds, for
the payment of contractual contributions pledged for the payment of
bonds, for debt service requirements for the payment of contractual
contributions pledged for the payment of bonds, and for debt
service requirements for the payment of notes and loans in the
following order of priority:
(a) For the payment of contributions required to be made by a
board of county road commissioners under a contract entered into
under 1941 PA 205, MCL 252.51 to 252.64, which contributions have
been pledged for the payment of the principal and interest on bonds
issued under that act, or for the payment of total debt service
requirements upon notes issued by a board of county road
commissioners under 1943 PA 143, MCL 141.251 to 141.254.
(b) For the payment of principal and interest upon bonds
issued under section 18c, and the payment of contributions of a
board of county road commissioners to be made pursuant to contracts
entered into under section 18d, which contributions are pledged to
the payment of principal and interest on bonds issued after June
30, 1957, under the authorization of section 18c and contracts
executed pursuant to its provisions.
(c) For the payment of principal and interest upon loans
received pursuant to section 11(7), to the extent other funds have
not been made available for that payment.
(9) Not to exceed 30% per year of the amount returned to a
county for use on the county primary road system may be expended,
with or without matching, on the county local road system of that
county. Not to exceed 15% per year of the amount returned to a
county for expenditure on the county local road system may be used,
with or without matching, on the county primary road system of that
county, and not to exceed an additional 15% per year of the amount
returned to a county for expenditure on the county local road
system, may, in case of an emergency or with the approval of the
state transportation department, be expended, with or without
matching, on the county primary road system of that county. An
amount returned to a county for and on account of county local
roads, under this section, in excess of the total amount paid into
the county treasury each year by all of the townships of that
county for and on account of the county local roads pursuant to
section 14(6) may be transferred to and expended on the county
primary road system of that county.
(10) Not less than 20% per year of the funds returned to a
county by this section shall be expended for snow and ice removal,
the construction or reconstruction of a new highway or existing
highway, and the acquisition of a necessary right of way for those
highways, and work incidental to those highways, or for the
servicing of bonds issued by the county for these purposes. Surplus
funds may be expended for the development, construction, or repair
of an off-street parking facility.
(11) Not more than 5% per year of the funds returned to a
county for the county primary road system and the county local road
system shall be expended for the maintenance, improvement, or
acquisition of appurtenant roadside parks and motor parkways.
(12) Funds returned to a county shall be expended by the
county road commission for the purposes provided in this section
and shall be deposited by the county treasurer in a designated
county depository, in a separate account to the credit of the
county road fund, and shall be paid out only upon the order of the
county road commission, and interest accruing on the money shall
become a part of, and be deposited with the county road fund.
(13) In a county to which the funds are returned the function
of the county road commission shall be limited to the formation of
policy and the performance of the official duties imposed by law
and delegated by the county board of commissioners. A member of the
county road commission shall not be employed individually in any
other capacity for other duties with the county road commission.
(14) A county road commission may enter into an agreement with
a county road commission of an adjacent county and with a city or
village to perform work on a highway, road, or street, and with the
state transportation department with respect to a state trunk line
and connecting links of the state trunk line within the limits of
the county or adjacent to the county. The agreement may provide for
the performance by each contracting party of the work contemplated
by the contract including engineering services and the acquisition
of rights of way in connection with the work contemplated, by
purchase or condemnation, by any of the contracting parties in its
own name and the agreement may provide for joint participation in
the costs.
(15) Money distributed from the Michigan transportation fund
may be expended for construction purposes on county local roads
only to the extent matched by money from other sources. However,
Michigan transportation funds may be expended for the construction
of bridges on the county local roads in an amount not to exceed 75%
of the cost of the construction of local road bridges. This
subsection does not apply to section 11b.
(16) Notwithstanding any other provision of this act, at least
90% of the state revenue returned annually to the county road
commission from the Michigan transportation fund less the amounts
described in subdivisions (a) to (e) shall be expended annually by
the county road commission for the preservation of highways, roads,
streets, and bridges, and for the payment of contractual
contributions pledged for the payment of bonds or portions of
bonds, debt service requirements for the payment of bonds or
portions of bonds, and debt service requirements for the payment of
notes and loans or portions of notes and loans issued or received
after July 1, 1983, for the purpose of providing funds for the
preservation of highways, roads, streets, and bridges. If an
appropriate certificate is filed under subsection (19) but only to
the extent necessary, this subsection shall not prohibit the use of
any amount of state revenue returned annually to the county road
commissions for the payment of contractual contributions pledged
for the payment of bonds, for debt service requirements for the
payment of bonds, and for debt service requirements for the payment
of notes or loans, whenever issued or received, as specified under
subsection (8). The amounts which are deducted from the state
revenue returned to a county road commission from the Michigan
transportation fund, for the purpose of the calculation required by
this subsection are as follows:
(a) Amounts expended for the purposes described in subsection
(8) for bonds, notes, loans, or other obligations issued or
received before July 2, 1983.
(b) Amounts expended for the administrative costs of the
county road commission.
(c) Amounts expended for capital outlay projects for equipment
and buildings, and for the payment of contractual contributions
pledged for the payment of bonds, for debt service requirements for
the payment of bonds, and for debt service requirements for the
payment of notes and loans issued or received after July 1, 1983,
for the purpose of providing funds for capital outlay projects for
equipment and buildings.
(d) Amounts expended for projects vital to the economy of the
local area or the safety of the public in the local area. Before
these amounts can be deducted, the governing body over the county
road commission or the county road commission, as applicable, shall
pass a resolution approving these projects. This resolution shall
state which projects will be funded and the cost of each project. A
copy of each approved resolution shall be forwarded immediately to
the department.
(e) Amounts expended in urban areas as determined pursuant to
section 12b.
(17) As used in this subsection, "urban routes" means those
portions of 2-lane county primary roads within an urban area which
has average daily traffic in excess of 15,000. Notwithstanding any
other provision of this act, except as provided in this subsection,
a county road commission shall expend annually at least 90% of the
federal revenue distributed to the use of the county road
commission for highways, roads, streets, and bridges, less the
amount expended on urban routes for other than preservation
purposes and the amount expended for hard-surfacing of gravel roads
on the federal-aid system, on the preservation of highways, roads,
streets, and bridges. A county road commission may expend in a year
less than 90% of the federal revenue distributed to the use of the
county road commission for highways, roads, streets, and bridges,
less the amount expended on urban routes for other than
preservation purposes and the amount expended for hard-surfacing of
gravel roads on the federal-aid system, on the preservation of
highways, roads, streets, and bridges, if that year is part of a 3-
year period in which at least 90% of the total federal revenue
distributed in the 3-year period to the use of the county road
commission for highways, roads, streets, and bridges, less the
amount expended on urban routes for other than preservation
purposes and the amount expended for hard-surfacing of gravel roads
on the federal-aid system, is expended on the preservation of
highways, roads, streets, and bridges. If a county road commission
expends in a year less than 90% of the federal revenue distributed
to the use of the county road commission for highways, roads,
streets, and bridges, less the amount expended on urban routes for
other than preservation purposes and the amount expended for hard-
surfacing of gravel roads on the federal-aid system, on the
preservation of highways, roads, streets, and bridges and that year
is not a part of a 3-year period in which at least 90% of the total
federal revenue distributed in the 3-year period to the use of the
county road commission for highways, roads, streets, and bridges,
less the amount expended on urban routes for other than
preservation purposes and the amount expended for hard-surfacing of
gravel roads on the federal-aid system, is expended on the
preservation of highways, roads, streets, and bridges, the county
road commission shall expend in each year subsequent to the 3-year
period 100%, or less in 1 year if sufficient for the purposes of
this subsection, of the federal revenue distributed to the use of
the county road commission for highways, roads, streets, and
bridges, less the amount expended on urban routes for other than
preservation purposes and the amount expended for hard-surfacing of
gravel roads on the federal-aid system, on the preservation of
highways, roads, streets, and bridges until the average percentage
spent on the preservation of highways, roads, streets, and bridges
in the 3-year period and the subsequent years, less the amount
expended on urban routes for other than preservation purposes and
the amount expended for hard-surfacing of gravel roads on the
federal-aid system, is at least 90%. A year may be included in only
one 3-year period for the purposes of this subsection. The
requirements of this subsection shall be waived if compliance would
cause the county road commission to be ineligible according to
federal law for federal revenue, but only to the extent necessary
to make the county road commission eligible according to federal
law for that revenue. For the purpose of the calculations required
by this subsection, the amount expended on urban routes by a county
road commission for other than preservation purposes and the amount
expended for hard-surfacing of gravel roads on the federal-aid
system shall be deducted from the total federal revenue distributed
to the use of the county road commission.
(18) A county road commission shall certify, which
certification shall, for purposes of the validity of bonds and
notes, be conclusive as to the matters stated therein, to the state
transportation department on or before the issuance of any bonds or
notes issued after July 1, 1983, pursuant to 1943 PA 143, MCL
141.251 to 141.254, 1941 PA 205, MCL 252.51 to 252.64, or section
18c or 18d, for purposes other than the preservation of highways,
roads, streets, and bridges and purposes other than the purposes
specified in subsection (16)(c) that its average annual debt
service requirements for all bonds and notes or portions of bonds
and notes issued after July 1, 1983, for purposes other than the
preservation of highways, roads, streets, and bridges and other
than for the purposes specified in subsection (16)(c), including
the bond or note to be issued does not exceed 10% of the funds
returned to the county road commission pursuant to this act, less
the amounts specified in subsection (16)(a), (b), and (c) during
the last completed fiscal year of the county road commission. If
the purpose for which the bonds or notes are issued is changed
after the issuance of the notes or bonds, the change shall be made
in such a manner to maintain compliance with the certification
required by this subsection, as of the date the certificate was
originally issued, but no such change shall invalidate or otherwise
affect the bonds or notes with respect to which the certificate was
issued or the obligation to pay debt service on the bonds or notes.
(19) In each charter county to which funds are returned under
this section, the responsibility for road improvement,
preservation, and traffic operation work, and the development,
construction, or repair of off-road parking facilities and
construction or repair of road lighting shall be coordinated by a
single administrator to be designated by the county executive who
shall be responsible for and shall represent the charter county in
transactions with the state transportation department pursuant to
this act.
(20) Not more than 10% per year of all of the funds received
by and returned to a county from any source for the purposes of
this section may be expended for administrative expenses. A county
that expends more than 10% for administrative expenses in a year
shall be subject to section 14(5) unless a waiver is granted by the
department of treasury. As used in this subsection, "administrative
expenses" means those expenses that are not assigned including, but
not limited to, specific road construction or preservation projects
and are often referred to as general or supportive services.
Administrative expenses shall not include net equipment expense,
net capital outlay, debt service principal and interest, and
payments to other state or local offices which are assigned, but
not limited to, specific road construction projects or preservation
activities.
(21) In addition to the financial compliance audits required
by law, the department of treasury shall conduct performance audits
and make investigations of the disposition of all state funds
received by county road commissions, county boards of
commissioners, or any other county governmental agency acting as
the county road authority, for transportation purposes to determine
compliance with the terms and conditions of this act. Performance
audits shall be conducted according to government auditing
standards issued by the United States general accounting office.
The department of treasury shall provide 6 months notice to the
county road commission or county board of commissioners, as
applicable, of the standards to be used for audits performed under
this subsection prior to the fiscal year in which the audit is
conducted. The department shall notify the county road commission
or county board of commissioners of any subsequent changes to the
standards. County road commissions or county boards of
commissioners, as applicable, shall make available to the
department of treasury the pertinent records for the audit.
(22) Funds that are federal in origin and that are intended
for distribution to a county road commission because the funds were
awarded pursuant to a grant application by a city, village, or
township shall be distributed to the city, village, or township
immediately after the department's approval. The department shall
grant approval if the department determines that the grant
application was consistent with federal guidelines.