HB-6417, As Passed House, November 10, 2010

SUBSTITUTE FOR

HOUSE BILL NO. 6417

A bill to amend 1994 PA 451, entitled

"Natural resources and environmental protection act,"

by amending section 5204a (MCL 324.5204a), as added by 2005 PA 254,

and by adding section 5317.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 5204a. (1) The authority, in conjunction with the

department, shall establish a strategic water quality initiatives

grant program that provides grants totaling not more than

~~$40,000,000.00~~ $80,000,000.00 to eligible municipalities. The grant

program shall provide assistance to municipalities to complete the

loan application requirements of section 5308 or to complete the

loan application requirements for other sources of financing for

sewage treatment works projects, storm water treatment projects, or

nonpoint source projects.

(2) The grant program is subject to all of the following:

(a) The grant program shall provide grants to cover not more

than 90% of the costs incurred by a municipality to complete an

application for loan assistance from the state water pollution

control revolving fund or the fund or to complete an application

for loan assistance from another source of financing for a sewage

treatment works project, a storm water treatment project, or a

nonpoint source project.

(b) The 10% local match is not eligible for loan assistance

from the state water pollution control revolving fund or the fund

or other source of financing for the project.

administrative activities or activities performed by municipal

employees.

(d) A municipality shall not receive more than $1,000,000.00

in total grant assistance under this section.

(e) Grants under this section shall be available for projects

seeking or intending to seek loan assistance after September 30,

2006.

~~(f) The department shall cease accepting grant applications~~

~~under this section 2 years after the date the first grant agreement~~

~~is entered into under subsection (3).~~

(3) ~~Within 6 months after the effective date of the amendatory~~

~~act that added this section, the~~ The department shall establish an

application and review process for considering grant applications

under this section. The application shall contain the information

required by the department and the authority. Within 30 60 days

after receipt of an application, the department shall publish

notice of the application on the department's calendar. Within 60

days after receipt of an administratively complete grant

application, the department shall, in writing, notify the applicant

whether the application is approved or rejected. If the department

approves a grant under this section, the department and the

authority shall enter into a grant agreement with the recipient

prior to transferring funds. The grant agreement shall contain

terms established by the department and the authority and a

requirement that the grant recipient repay the grant, within 90

days of being informed to do so, with interest at a rate not to

exceed 8% per year, to the authority for deposit into the fund if

any of the following occur:

(a) The applicant fails to submit an administratively complete

loan application for assistance from the state water pollution

control revolving fund or the fund or other source of financing for

the project within 3 years of the grant award.

(b) The project has been identified as being in the fundable

range or is approved for funding from another source and the

applicant declines the loan assistance ~~from the state water~~

~~pollution control revolving fund or the fund in that fiscal year.~~

for 2 consecutive fiscal years unless the applicant proceeds with

funding from another source.

with constructing the project. ~~or opts to finance construction by~~

~~means other than a grant from the state water pollution control~~

~~revolving fund or the fund.~~

(4) For each year in which the department receives grant

applications under this section, the department shall report by

July 1 of each year to the standing committees of the senate and

the house of representatives with primary jurisdiction over issues

pertaining to natural resources and the environment and to the

senate and house of representatives appropriations committees on

the utilization of funds under this part that were received from

the Great Lakes water quality bond fund created in section 19706.

The report shall include, at a minimum, all of the following:

(a) The number of grant applications received under this

section.

(b) The name of each municipality applying for a grant.

awarded, including an identification of whether each award was for

the purpose of applying for assistance from the state water

pollution control revolving fund or the fund.

(d) A summary of loan assistance, by year, tendered from the

state water pollution control revolving fund and the fund.

(5) The senate and house appropriations committees shall

annually review whether there is sufficient money in the fund to

implement this section and section 5202.

Sec. 5317. (1) The state water pollution control revolving

fund advisory committee is created within the department of natural

resources and environment.

(2) The committee shall consist of a representative of the

department of natural resources and environment and additional

members appointed by the director of the department of natural

resources and environment upon recommendation from at least the

following organizations:

(a) The American council of engineering companies.

(b) The American waterworks association.

(d) The Michigan association of counties.

(e) The Michigan townships association.

(f) The Michigan municipal league with regard to appointing

members from the following:

(i) A rural municipality with a population of 10,000 or less

that operates a sewage treatment works system.

(ii) A suburban municipality that operates a sewage treatment

works system.

(iii) A city that operates a sewage treatment works system.

(g) A statewide association representing drain commissioners.

(h) The Michigan infrastructure and transportation

association.

(i) The Michigan water and environment association.

(j) A statewide organization of regional planning authorities.

(k) A statewide environmental or conservation organization.

(3) The members first appointed to the committee shall be

appointed within 60 days after the effective date of the amendatory

act that added this section.

(4) If a vacancy occurs on the committee, the director shall

make an appointment for the unexpired term in the same manner as

the original appointment.

(5) The director may remove a member of the committee for

incompetency, dereliction of duty, malfeasance, misfeasance, or

nonfeasance in office, or any other good cause.

(6) The first meeting of the committee shall be called by the

director of the department of natural resources and environment.

(7) A majority of the members of the committee constitute a

quorum for the transaction of business at a meeting of the

committee. A majority of the members present and serving are

required for official action of the committee.

(8) The business that the committee may perform shall be

conducted at a public meeting of the committee held in compliance

with the open meetings act, 1976 PA 267, MCL 15.261 to 15.275.

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

retained by the committee in the performance of an official

function is subject to the freedom of information act, 1976 PA 442,

MCL 15.231 to 15.246.

(10) Members of the committee shall serve without

compensation.

(11) Staff from the department of natural resources and

environment shall assist with the administrative tasks of the

committee, including meeting notices, minutes, and compilation of

resource materials and reports.

(12) The committee shall evaluate this part and make

recommendations on how this part could be amended to achieve the

following outcomes:

(a) Increasing the level of investment in sewage collection

and treatment systems.

(b) Providing incentives for actions that not only improve

water quality but result in pollution prevention.

of sewage collection and treatment systems.

(13) The committee shall review and make recommendations on

revisions to this part related to at least all of the following:

(a) Revising procedures to accommodate concurrent design and

build type procurement and other nontraditional contracting

procedures.

(b) Allowing project planning and preconstruction as costs

eligible for assistance from the fund.

requirements to be more consistent with local planning needs.

(d) Updating the scoring system to take into account

infrastructure asset management.

(e) Simplifying application procedures.

(f) Reviewing options to provide grants to municipalities for

timely and appropriate project planning, including disincentives

for failure to demonstrate progress.

(g) Establishing protocols for a premeeting process for the

department of natural resources and environment to provide informal

feedback to review the application and determine the likelihood of

receiving funding.

(h) Recommending a new model for establishing interest rates

on a sliding scale based on the percentage of income paid in

utility fees.

(i) Reviewing options to allow municipalities to be able to

roll project plan expenses into the loans.

(j) Alternative financing mechanisms for funding sewage

treatment works projects, storm water projects, and nonpoint source

projects.

(14) The committee shall review and make recommendations

regarding the need for and design of a grant program for the

purpose of funding specific wastewater treatment facility

infrastructure improvements projects designed to prevent chronic

discharges and projected to have significant regional benefits to

Great Lakes water quality and recreational opportunities.

(15) Not later than August 1, 2011, the committee shall submit

a report to the department of natural resources and environment and

to the standing committees of the senate and house of

representatives with jurisdiction over issues primarily pertaining

to natural resources and the environment, containing the

committee's conclusions and recommendations.

(16) Effective 6 months after the committee submits its report

under subsection (15), the committee is abolished.

(17) As used in this section, "committee" means the state

water pollution control revolving fund advisory committee created

in subsection (1).

Enacting section 1. This amendatory act does not take effect

unless all of the following bills of the 95th Legislature are

enacted into law:

(a) Senate Bill No. 1345.

(b) Senate Bill No. 1346.

(d) Senate Bill No. 1442.