February 2, 2016, Introduced by Senators ANANICH, YOUNG, BIEDA, GREGORY and KNEZEK and referred to the Committee on Government Operations.
A bill to amend 1994 PA 451, entitled
"Natural resources and environmental protection act,"
by amending section 5409 (MCL 324.5409), as added by 1997 PA 26.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 5409. (1) A water supplier whose project plan is approved
or under review by the department under section 5407 may apply for
assistance from the fund by submitting an application to the
department. A complete application shall include all of the
following, if applicable, as determined by the department:
(a) If assistance is in the form of a loan, financial
documentation that a dedicated source of revenue is established,
consistent with obligations of debt instruments existing at the
time assistance is requested, and pledged to both of the following
purposes:
(i) The timely repayment of principal and interest.
(ii) Adequate revenues to fund the operation and maintenance
of the project.
(b) Evidence of an approved project plan.
(c) A certified resolution from a water supplier that is a
municipality, or a letter of appointment from a water supplier that
is not a municipality, designating an authorized representative for
the project.
(d) A certification by an authorized representative of the
water supplier affirming that the supplier has the legal,
institutional, technical, financial, and managerial capability to
build, operate, and maintain the project. However, the water
supplier does not need to certify that it will operate and maintain
any portion of the project that funds the replacement of private
service lines.
(e) A letter of credit, insurance, or other credit enhancement
to support the credit position of the water supplier, as required
by the department.
(f) A set of plans and specifications, developed in accordance
with Act 399, which is suitable for bidding.
(g) A certification from an authorized representative of the
water supplier that it has, or will have before the start of
construction, all applicable state and federal permits required for
construction of the project.
(h) A certification from an authorized representative of the
water supplier that an undisclosed fact or event, or pending
litigation, will not materially or adversely affect the project,
the prospects for its completion, or the water supplier's ability
to make timely loan repayments, if applicable.
(i) If applicable, all executed service contracts or
agreements.
(j) An agreement that the water supplier will operate the
waterworks system in compliance with applicable state and federal
laws.
(k) An agreement that the water supplier will not sell, lease,
abandon, or otherwise dispose of the waterworks system without an
effective assignment of obligations and the prior written approval
of the department and the authority.
(l) An agreement that includes either of the following:
(i) For water suppliers that are municipalities, all accounts
will be maintained in accordance with generally accepted accounting
practices, generally accepted government auditing standards, and
chapter
75 of title 31 of the United States Code, 31 U.S.C. USC
7501 to 7507, as required by the federal safe drinking water act.
(ii) For water suppliers that are not municipalities, all
accounts will be maintained in accordance with generally accepted
accounting practices and generally accepted auditing standards.
(m) An agreement that all water supplier contracts with
contractors will require them to maintain project accounts in
accordance with the requirements of this subsection and provide
notice that any subcontractor may be subject to a financial audit
as part of an overall project audit.
(n) An agreement that the water supplier will provide written
authorizations to the department for the purpose of examining the
physical plant and for examining, reviewing, or auditing the
operational or financial records of the project, and that the water
supplier will require similar authorizations from all contractors,
consultants, or agents with which it negotiates an agreement.
(o) An agreement that all pertinent records shall be retained
and available to the department for a minimum of 3 years after
initiation of the operation and that if litigation, a claim, an
appeal, or an audit is begun before the end of the 3-year period,
records shall be retained and available until the 3 years have
passed or until the action is completed and resolved, whichever is
longer. As used in this subdivision, "initiation of the operation"
means the date certain set by the water supplier and accepted by
the department, on which use of the project begins for the purposes
for which it was constructed.
(p) If the project is segmented, as provided in section
5406(3), a schedule for completion of the project and adequate
assurance that the project will be completed with or without
assistance from the fund or that the segmented project will be
operational without completion of the entire project.
(q) An agreement that the project will proceed in a timely
fashion if the application for assistance is approved.
(r) An application fee, if required by the department.
(s) (2)
A demonstration that a dedicated
source of revenue
will
be available for operating and maintaining to support the
waterworks system and repaying the incurred debt.
(2) (3)
The department shall accept
applications for
assistance from water suppliers in the fundable range of the
priority list and shall determine whether an application for
assistance is complete.
(3) (4)
The state is not liable to a water
supplier, or any
other person performing services for the water supplier, for costs
incurred in developing or submitting an application for assistance
under this part.
Enacting section 1. This amendatory act does not take effect
unless Senate Bill No. 730
of the 98th Legislature is enacted into law.