Bill Text: MI SB0312 | 2013-2014 | 97th Legislature | Engrossed
Bill Title: Higher education; financial aid; promise zone authority act; make general revisions. Amends secs. 3, 5, 7, 11, 15 & 17 of 2008 PA 549 (MCL 390.1663 et seq.).
Spectrum: Partisan Bill (Republican 1-0)
Status: (Passed) 2013-12-31 - Assigned Pa 0210'13 With Immediate Effect [SB0312 Detail]
Download: Michigan-2013-SB0312-Engrossed.html
SB-0312, As Passed House, December 12, 2013
SUBSTITUTE FOR
SENATE BILL NO. 312
A bill to amend 2008 PA 549, entitled
"Michigan promise zone authority act,"
by amending sections 3, 5, 7, 11, 15, and 17 (MCL 390.1663,
390.1665, 390.1667, 390.1671, 390.1675, and 390.1677).
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3. As used in this act:
(a) "Authority" means a promise zone authority created under
this act.
(b) "Board" means the governing body of an authority.
(c) "Eligible entity" means a city, township, county, local
school district, or intermediate school district, in which the
percentage of families with children under age 18 that are living
at or below the federal poverty level is greater than or equal to
the state average of families with children under age 18 living at
or below the federal poverty level, as determined by the department
of treasury.
(d) "Federal poverty level" means the poverty guidelines
published annually in the federal register by the United States
department of health and human services under its authority to
revise the poverty line under section 673(2) of subtitle B of title
VI of the omnibus budget reconciliation act of 1981, Public Law 97-
35, 42 USC 9902.
(e) "Governing body" means the elected body of an eligible
entity
having that has legislative powers.
(f) "Nonpublic high school" means a high school operated by a
nonpublic school that includes grades 9 to 12 or 10 to 12 and that
awards a high school diploma. Nonpublic high school also includes a
general education development test.
(g) "Nonpublic school" means that term as defined in section 5
of the revised school code, 1976 PA 451, MCL 380.5.
(h) "Promise of financial assistance" means a commitment by an
eligible entity to provide financial resources for public or
private postsecondary education, including a vocational program, to
eligible students living in a promise zone and who have graduated
from a public high school or nonpublic high school located within
that promise zone.
(i) "Promise zone" means that area created by a governing body
under this act.
(j) "Promise zone development plan" means that plan developed
by an authority under this act that will ensure that the financial
resources are available to adequately fund the promise of financial
assistance.
(k) "Public high school" means a public school that includes
grades 9 to 12 or 10 to 12 and that awards a high school diploma.
(l) "Public school" means that term as defined in section 5 of
the revised school code, 1976 PA 451, MCL 380.5.
(m) "Qualified educational expenses" means tuition and fees
required for the enrollment or attendance of a student at an
educational institution and expenses for fees, books, supplies, and
equipment required for courses of instruction at that educational
institution.
(n) (m)
"School district" means
that term as defined in the
revised school code, 1976 PA 451, MCL 380.1 to 380.1852.
(o) (n)
"State education tax" means
the tax levied under the
state education tax act, 1993 PA 331, MCL 211.901 to 211.906.
(p) "Vocational program" means an education or training
program intended to teach a trade, occupation, or vocation and
offered by a public or private postsecondary institution in this
state.
Sec. 5. (1) If the department of treasury certifies the
eligibility of a governing body to establish a promise zone and the
governing body, by resolution, establishes a promise zone under the
Michigan promise zone act, 2008 PA 550, MCL 390.1641 to 390.1649,
the governing body shall, by resolution, create a promise zone
authority.
(2) An authority is a public body corporate that may sue and
be sued in any court of this state. An authority possesses all the
powers necessary to carry out its purpose. The enumeration of a
power
in this act shall not be construed as a limitation upon on
the general powers of an authority.
(3) An authority shall be under the supervision and control of
a
board. consisting of 11 members. Nine members shall be
appointed
by
the All of the following
apply to the board of an authority:
(a) The board shall consist of 11 members, as follows:
(i) Nine locally appointed members. The chief executive officer
of the eligible entity, with the advice and consent of the
governing body, shall appoint the 9 initial locally appointed
members of the board described in this subparagraph. If a vacancy
occurs in an office of a locally appointed member appointed under
this subparagraph, the board shall appoint a new member to fill
that vacancy. As used in this subparagraph, for a local school
district or an intermediate school district, "chief executive
officer" means the superintendent of that local school district or
intermediate school district.
(ii) One member shall be appointed
by the senate majority
leader.
(iii) One member shall be appointed
by the speaker of the house
of representatives.
(b) Not more than 3 members of the board shall be government
officials.
(c) One member of the board shall be a representative of the
public
school community. Of
(d) The term of office of a member of the board is 4 years.
However, of the members first appointed, an equal number of the
members, as near as is practicable, shall be appointed for 1 year,
2 years, 3 years, and 4 years.
(e) A member of the board shall hold office until the member's
successor
is appointed. After the initial appointment, each member
shall
serve for a term of 4 years. An appointment to fill a vacancy
shall
be made by the chief executive officer of the eligible entity
for
the unexpired term only.
(f) Members of the board shall serve without compensation, but
may be reimbursed for actual and necessary expenses.
(g) The chairperson of the board shall be elected by the
board.
As used in this subsection, for a local school district or
an
intermediate school district, "chief executive officer" means
the
superintendent of the local school district or intermediate
school
district.
(4) Before assuming the duties of office, a member shall
qualify by taking and subscribing to the constitutional oath of
office.
(5) The proceedings and rules of the board are subject to the
open meetings act, 1976 PA 267, MCL 15.261 to 15.275. The board
shall adopt rules governing its procedure and the holding of
regular meetings, subject to the approval of the governing body.
Special meetings may be held if called in the manner provided in
the rules of the board.
(6) After having been given notice and an opportunity to be
heard, a member of the board may be removed for cause by the
governing body.
(7) A writing prepared, owned, used, in the possession of, or
retained by the board in the performance of an official function is
subject to the freedom of information act, 1976 PA 442, MCL 15.231
to 15.246.
Sec. 7. (1) A promise zone authority created under section 5
shall prepare a promise zone development plan.
(2)
The A promise zone development plan shall include, but is
not limited to, all of the following:
(a) A complete description of the proposed promise of
financial assistance. The proposed promise of financial assistance
shall include, but is not limited to, a promise of financial
assistance to all eligible students residing within the promise
zone and who graduate from a public high school or nonpublic high
school located within that promise zone, in an amount established
by the board to reflect the amount available for disbursement to
eligible students and included in the annual budget under section
15. The amount of proposed promise of financial assistance shall,
at
a minimum, provide funding equal
or exceed the amount the board
determines
is sufficient to provide pay for the qualified
educational
expenses for an eligible student the
tuition necessary
to
obtain an associate degree or its equivalent at a community or
junior
college in this state, or combination of community or junior
colleges
in this state and, at most, provide funding sufficient to
provide
an eligible student the tuition necessary and shall not
exceed the amount the board determines is sufficient to pay for the
qualified educational expenses for an eligible student to obtain a
bachelor's degree or its equivalent at a public postsecondary
institution in this state or combination of public postsecondary
institutions in this state, subject to any limitations authorized
under this section. The proposed promise of financial assistance
may also, at most, provide funding for an eligible student to
attend
a private college in this state in an amount not to that
does
not exceed the average tuition
necessary amount of qualified
educational expenses to obtain a bachelor's degree at all public
universities in this state. The proposed promise of financial
assistance may also authorize the expenditure of funds for
educational improvement activities designed to increase readiness
for postsecondary education at public schools located in the
promise zone.
(b) A complete description of any limitation on the promise of
financial
assistance, ; if including,
but not limited to, any of
the following:
(i) If the promise of financial assistance will be prorated
based on the number of years the student has resided within the
promise
zone. ; if
(ii) If the promise of financial assistance will be restricted
to students who have resided within or attended a public high
school or nonpublic high school within the promise zone for a
minimum
number of years. ; if
(iii) If the promise of financial assistance is predicated on
the student maintaining a minimum college grade point average and
carrying
a minimum college credit hour classload.
; or if
(iv) If the promise of financial assistance is restricted to
attendance at 1 or more public or private postsecondary
institutions in this state.
(v) If the promise of financial assistance is limited to
students whose cumulative high school grade point average exceeds a
specified minimum. However, a board may revise, establish, or
eliminate a high school grade point average requirement for
students after it submits a promise zone development plan to the
department of treasury and is not required to amend the plan or
obtain approval from the department of treasury for that change.
(vi) If the promise of financial assistance is limited to
students who comply with requirements established by the board in
order to improve student progress toward degree completion.
(vii) If the promise of financial assistance in a promise zone
that encompasses more than 2 school districts is limited to
students who reside in and graduate from high schools located
within the boundaries of fewer than all of its constituent school
districts.
(c) A requirement that graduates of a public high school or
nonpublic high school exhaust all other known and available
restricted
grants for tuition and fees qualified
educational
expenses for postsecondary education provided by a federal, state,
or local governmental entity, as determined by the board.
(d) How the funds necessary to accomplish the promise of
financial assistance will be raised. Any amount received under the
state
school aid act of 1979, 1979 PA 94, MCL 388.1601 to 388.1772,
388.1896, shall not be included as a method of raising the
necessary funds. The promise zone development plan shall be
financed from 1 or more of the following sources:
(i) Donations.
(ii) Revenues.
(iii) Money obtained from other sources approved by the
governing body or otherwise authorized by law.
(e) An actuarial model of how much the proposed plan is
estimated to cost, based on actuarial formulas developed by the
department of treasury.
(3) The proposed promise of financial assistance under
subsection (2) shall not include funding for attendance at a public
or private postsecondary institution not located in this state.
(4) The board shall submit the promise zone development plan
to the department of treasury promptly after its adoption. The
promise zone development plan shall be published on the website of
the eligible entity that established the promise zone.
(5) The department of treasury shall review the promise zone
development plan submitted under subsection (4). Not more than 60
days after receipt of a promise zone development plan submitted
under subsection (4), the department of treasury shall either
approve the promise zone development plan or provide a written
notice of deficiencies. If the department of treasury does not
approve a promise zone development plan submitted under subsection
(4) or provide a written notice of deficiencies within 60 days, the
promise zone development plan shall be considered approved. If a
promise zone development plan is approved, the department of
treasury shall certify that the promise zone development plan meets
all requirements under this act and is sustainable.
(6) The department of treasury shall review any proposed
amendments to a promise zone development plan. Not more than 60
days after receipt of proposed amendments to a promise zone
development plan, the department of treasury shall either approve
the proposed amendments or provide a written notice of
deficiencies. If the department of treasury does not approve
proposed amendments or provide a written notice of deficiencies
within 60 days, the proposed amendments shall be considered
approved. If proposed amendments are approved, the department of
treasury shall certify that the amendments meet all requirements
under this act.
Sec.
11. (1) The board may employ and fix the a director. All
of the following apply to a director employed by a board under this
subsection:
(a)
The board shall establish the director's compensation. of
a
director.
(b)
The director shall serve serves at
the pleasure of the
board.
(c) A member of the board is not eligible to hold the position
of director.
(d) Before beginning his or her duties, the director shall
take
and subscribe to the constitutional oath and furnish a bond
by
posting
a bond in the sum in an
amount determined in the resolution
establishing the authority, payable to the authority for use and
benefit of the authority, approved by the board, and filed with the
clerk of the eligible entity. The premium on the bond shall be
considered an operating expense of the authority, payable from
funds
money available to the authority for expenses of
operation.
(e)
The director shall be is the
chief executive officer of
the authority.
(2) Subject to the approval of the board, the director shall
supervise
and be is responsible for implementing the promise zone
development plan and the performance of the functions of the
authority
in the manner authorized by under
this act. The director
shall attend the meetings of the board and shall provide to the
board, the governing body, and the chief executive officer of the
eligible entity a regular report covering the activities and
financial condition of the authority. If the director is absent or
disabled, the board may designate a qualified person as acting
director to perform the duties of the office. Before beginning his
or her duties, the acting director shall take and subscribe to the
oath, and furnish a bond, as required of the director under
subsection (1)(d). The director shall furnish the board with any
information
or reports governing the operation of the authority as
that the board requires.
(3) The board may employ and fix the compensation of a
treasurer, who shall keep the financial records of the authority
and who, together with the director, shall approve all vouchers for
the
expenditure of funds money
of the authority. The treasurer
shall perform all duties delegated to him or her by the board and
shall furnish a bond in an amount prescribed by the board.
(4) The board may employ and fix the compensation of a
secretary, who shall maintain custody of the official seal and of
records, books, documents, or other papers the treasurer is not
required
to be maintained by the treasurer. maintain. The secretary
shall attend meetings of the board and keep a record of its
proceedings and shall perform other duties delegated by the board.
(5) The board may retain legal counsel to advise the board in
the proper performance of its duties.
(6)
The board may employ any other personnel considered that
the
board considers necessary. by
the board.
(7)
Money received by the The authority shall immediately be
deposited
deposit any money it receives
to the credit of the
authority, subject to disbursement under this act.
(8)
The authority shall not expend more than 15% of the
proposed
annual budget Beginning in
the first fiscal year in which
it receives revenue from the state from the capture of state
education tax revenue under section 17, the authority may use not
more than 15% of the amount of that revenue to pay for
administrative costs.
(9) Within 120 days after the end of each fiscal year, the
board shall submit audited financial statements of the authority
for that fiscal year to the department of education. The board
shall include with the financial statements a certification by the
board that the board and authority are in compliance with this act,
with the requirements of the Michigan promise zone act, 2008 PA
550, MCL 390.1641 to 390.1649, and with the authority's approved
promise zone development plan.
Sec.
15. (1) The director of the authority shall submit board
shall
adopt a budget to the board for
the operation of the
authority
for each fiscal year, before the beginning of the that
fiscal year, based on a budget submitted to it by the director. The
budget shall be prepared in the manner and contain the information
required
of municipal departments. After review by the board, the
budget
shall be submitted to the governing body. The governing body
must
approve the budget before the board may adopt the budget.
Unless
authorized by the governing body, funds the budget of an
authority
shall not include any money of the
eligible entity. shall
not
be included in the budget of the authority.
(2) The budget described in subsection (1) shall include the
amount the authority intends to disburse to each eligible student
in the fiscal year covered by the budget. Subject to the maximum
amounts described in section 7(2)(a), the board shall establish the
amount of the annual payment to eligible students and, in making
that determination, shall consider the financial resources
available to the authority for disbursement to those students.
Sec. 17. (1) The authority shall determine the base year for
calculating the amount of incremental growth for the capture of the
state education tax as provided in this section. The base year is
the amount of revenue received from the collection of the state
education tax in the promise zone in the year immediately preceding
the
year in which an authority makes its initial tuition payment of
qualified educational expenses in accordance with the promise of
financial assistance or the amount of revenue received from the
collection of the state education tax in the promise zone in any 1
of
the 3 5 immediately succeeding years, whichever is less.
(2) If the authority continues to make annual payments in
accordance with the promise of financial assistance, in the year
immediately succeeding the base year determined in subsection (1)
and each year thereafter, this state shall capture 1/2 of the
increase in revenue, if any, from the collection of the state
education tax. This state shall not capture any revenue from the
collection of the state education tax under this act if that
revenue is subject to capture under any other law of this state.
Proceeds from the capture of the state education tax under this
section shall be deposited in the state treasury and credited to a
restricted fund to be used solely for the purposes of this act.
(3)
If the authority continues to make annual tuition payments
of qualified educational expenses in accordance with the promise of
financial assistance, 2 years after the authority's initial payment
of financial assistance and each year thereafter, this state shall
pay to the authority the state education tax captured under
subsection (2). If the boundaries of 2 or more promise zones
created under this act overlap, payments under this section shall
only be made to the first authority eligible for payment under this
subsection.
(4)
If at any time the authority does not make annual tuition
payments of qualified educational expenses in accordance with the
promise for financial assistance, any amount captured from that
promise zone in the restricted fund created under subsection (2)
shall be paid into the school aid fund established in section 11 of
article IX of the state constitution of 1963.
(5) For purposes of this section, payments under this section
shall not be included in determining payments for financial
assistance in the immediately preceding year.
