Bill Text: MI SB0544 | 2011-2012 | 96th Legislature | Introduced

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Bill Title: Transportation; funds; funding for highway-railroad grade crossing surface repair and construction; establish. Amends secs. 10, 11 & 11f of 1951 PA 51 (MCL 247.660 et seq.).

Spectrum: Moderate Partisan Bill (Republican 7-1)

Status: (Introduced - Dead) 2011-06-30 - Referred To Committee On Transportation [SB0544 Detail]

Download: Michigan-2011-SB0544-Introduced.html

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SENATE BILL No. 544

 

 

June 30, 2011, Introduced by Senators MOOLENAAR, GREEN, ROBERTSON, BRANDENBURG, GLEASON, CASPERSON, HILDENBRAND and KOWALL 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 promote safe and efficient travel for

motor vehicle drivers, bicyclists, pedestrians, and other legal

users of roads, streets, and highways; 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 10, 11, and 11f (MCL 247.660, 247.661, and

 

247.661f), section 10 as amended by 2007 PA 210, section 11 as

 

amended by 2002 PA 639, and section 11f as amended by 2008 PA 73.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 10. (1) A fund to be known as the Michigan transportation

 

fund is established and shall be set up and maintained in the state

 

treasury as a separate fund. Money received and collected under the

 

motor fuel tax act, 2000 PA 403, MCL 207.1001 to 207.1170, except a

 

license fee provided in that act, and a tax, fee, license, and

 

other money received and collected under sections 801 to 810 of the

 

Michigan vehicle code, 1949 PA 300, MCL 257.801 to 257.810, except

 

a truck safety fund fee provided in section 801(1)(k) of the

 

Michigan vehicle code, 1949 PA 300, MCL 257.801, and money received

 

under the motor carrier act, 1933 PA 254, MCL 475.1 to 479.43,

 

shall be deposited in the state treasury to the credit of the

 

Michigan transportation fund. In addition, income or profit derived

 

from the investment of money in the Michigan transportation fund

 

shall be deposited in the Michigan transportation fund. Except as

 

provided in this act, no other money, whether appropriated from the

 

general fund of this state or any other source, shall be deposited

 

in the Michigan transportation fund. Except as otherwise provided

 

in this section, the legislature shall appropriate funds money for

 

the necessary expenses incurred in the administration and

 

enforcement of the motor fuel tax act, 2000 PA 403, MCL 207.1001 to

 

207.1170, the motor carrier act, 1933 PA 254, MCL 475.1 to 479.43,

 

and sections 801 to 810 of the Michigan vehicle code, 1949 PA 300,

 

MCL 257.801 to 257.810. Funds Money appropriated for necessary

 

expenses shall be based upon established cost allocation

 

methodology that reflects actual costs. Appropriations for the

 

necessary expenses incurred by the department of state in

 

administration and enforcement of sections 801 to 810 of the

 

Michigan vehicle code, 1949 PA 300, MCL 257.801 to 257.810, shall

 

be made from the Michigan transportation fund and from funds money

 

in the transportation administration collection fund created in

 

section 810b of the Michigan vehicle code, 1949 PA 300, MCL

 

257.810b. Appropriations from the Michigan transportation fund for

 

the necessary expenses incurred by department of state in

 

administration and enforcement of sections 801 to 810 of the

 

Michigan vehicle code, 1949 PA 300, MCL 257.801 to 257.810, shall

 

not exceed $20,000,000.00 per state fiscal year. except for the

 

fiscal year ending September 30, 2006. For the fiscal year ending

 

September 30, 2006, the legislature may appropriate funds in excess

 

of $20,000,000.00 from the Michigan transportation fund for all

 

incremental additional expenses incurred by the department of state

 

in enforcing sections 801 to 810 of the Michigan vehicle code, 1949

 

PA 300, MCL 257.801 to 257.810, that arise because of the

 

replacement of standard design registration license plates as

 

provided in section 224 of the Michigan vehicle code, 1949 PA 300,

 

MCL 257.224. All money in the Michigan transportation fund is

 

apportioned and appropriated in the following manner:

 

     (a) Not more than $3,000,000.00 as may be annually

 

appropriated each fiscal year to the state trunk line fund for

 

subsequent deposit in the rail grade crossing account.

 

     (b) Not more than $3,000,000.00 as may be annually

 

appropriated each fiscal year to the state trunk line fund for

 

subsequent deposit in the grade crossing surface account.

 

     (c) (b) Not less than $3,000,000.00 each year to the local

 

bridge fund established in subsection (5) (4) for the purpose of

 

payment of the principal, interest, and redemption premium on any

 

notes or bonds issued by the state transportation commission under

 

former section 11b or subsection (10) (9).

 

     (d) (c) Revenue from 3 cents of the tax levied under section

 

8(1)(a) of the motor fuel tax act, 2000 PA 403, MCL 207.1008, to

 

the state trunk line fund, county road commissions, and cities and

 

villages in the percentages provided in subdivision (i) (k).

 

     (e) (d) Until September 30, 2004, all of the revenue from 1

 

cent of the tax levied under section 8(1)(a) of the motor fuel tax

 

act, 2000 PA 403, MCL 207.1008, to the state trunk line fund for

 

repair of state bridges under section 11. Beginning October 1, 2004

 

and continuing through September 30, 2005, 3/4 of the revenue from

 

1 cent of the tax levied under section 8(1)(a) of the motor fuel

 

tax act, 2000 PA 403, MCL 207.1008, shall be appropriated to the

 

state trunk line fund for the repair of state bridges under section

 

11, and 1/4 of the revenue from 1 cent of the tax levied under

 

section 8(1)(a) of the motor fuel tax act, 2000 PA 403, MCL

 

207.1008, shall be appropriated to the local bridge fund created in

 

subsection (5) for distribution only to cities, villages, and

 

county road commissions. Beginning October 1, 2005, 1/2 One-half of

 

the revenue from 1 cent of the tax levied under section 8(1)(a) of

 

the motor fuel tax act, 2000 PA 403, MCL 207.1008, shall be

 

appropriated to the state trunk line fund for the repair of state

 

bridges under section 11, and 1/2 of the revenue from 1 cent of the

 

tax levied under section 8(1)(a) of the motor fuel tax act, 2000 PA

 

403, MCL 207.1008, shall be appropriated to the local bridge fund

 

created in subsection (5) (4) for distribution only to cities,

 

villages, and county road commissions.

 

     (f) (e) $43,000,000.00 to the state trunk line fund for debt

 

service costs on state of Michigan projects.

 

     (g) (f) Except as provided in subsection (4), 10% Ten percent

 

to the comprehensive transportation fund for the purposes described

 

in section 10e.

 

     (h) (g) $5,000,000.00 to the local bridge fund established in

 

subsection (5) (4) for distribution only to the local bridge

 

advisory board, the regional bridge councils, cities, villages, and

 

county road commissions.

 

     (i) (h) $36,775,000.00 to the state trunk line fund for

 

subsequent deposit in the transportation economic development fund,

 

and, as of September 30, 1997, with first priority for allocation

 

to debt service on bonds issued to fund transportation economic

 

development fund projects. In addition, beginning October 1, 1997,

 

$3,500,000.00 is appropriated from the Michigan transportation fund

 

to the state trunk line fund for subsequent deposit in the

 

transportation economic development fund to be used for economic

 

development road projects in any of the targeted industries

 

described in section 9(1)(a) of 1987 PA 231, MCL 247.909.

 

     (j) (i) Not less than $33,000,000.00 as may be annually

 

appropriated each fiscal year to the local program fund created in

 

section 11e.

 

     (k) (j) The balance of the Michigan transportation fund as

 

follows, after deduction of the amounts appropriated in

 

subdivisions (a) through (i) and section 11b:to (j):

 

     (i) 39.1% to the state trunk line fund for the purposes

 

described in section 11.

 

     (ii) 39.1% to the county road commissions of the this state.

 

     (iii) 21.8% to the cities and villages of the this state.

 

     (2) The money appropriated pursuant to this section shall be

 

used for the purposes as provided in this act and any other

 

applicable act. Subject to the requirements of section 9b, the

 

department shall develop programs in conjunction with the Michigan

 

state chamber of commerce and the Michigan minority business

 

development council to assist small businesses, including those

 

located in enterprise zones and those located in empowerment zones

 

as determined under federal law, as defined by law in becoming

 

qualified to bid.

 

     (3) Thirty-one and one-half percent of the funds money

 

appropriated to this state from the federal government pursuant to

 

23 USC 157, commonly known as minimum guarantee funds, shall be

 

allocated to the transportation economic development fund, if such

 

an allocation is consistent with federal law. These funds This

 

money shall be distributed 16-1/2% for development projects for

 

rural counties as defined by law and 15% for capacity improvement

 

or advanced traffic management systems in urban counties as defined

 

by law. Federal funds money allocated for distribution under this

 

section shall be eligible for obligation and use by all recipients

 

as defined by the transportation equity act for the 21st century,

 

Public Law 105-178.

 

     (4) For the fiscal year beginning October 1, 2003 only, the

 

apportionment of 10% of Michigan transportation fund money to the

 

comprehensive transportation fund as provided in subsection (1)(f)

 

shall be reduced by $10,000,000.00 and the $10,000,000.00 shall be

 

transferred to the state trunk line fund for capacity improvements

 

to state trunk line highways.

 

     (4) (5) A fund to be known as the local bridge fund is

 

established and is set up and maintained in the state treasury as a

 

separate fund. The money appropriated to the local bridge fund and

 

the interest accruing to that fund shall be expended for the local

 

bridge program. The purpose of the fund is to provide financial

 

assistance to highway authorities for the preservation,

 

improvement, or reconstruction of existing bridges or for the

 

construction of bridges to replace existing bridges in whole or

 

part. The money in the local bridge fund is not subject to section

 

12(15) or 13(5). The local bridge advisory board is created and

 

shall consist of 6 voting members appointed by the state

 

transportation commission and 2 nonvoting members appointed by the

 

state transportation department. The board shall include 3 members

 

from the county road association of Michigan, 1 member who

 

represents counties with populations 65,000 or greater, 1 member

 

who represents counties with populations greater than 30,000 and

 

less than 65,000, and 1 member who represents counties with

 

populations of 30,000 or less. Three members shall be appointed

 

from the Michigan municipal league, 1 member who represents cities

 

with a population 75,000 or greater, 1 member who represents cities

 

with a population less than 75,000, and 1 member who represents

 

villages. Each organization with voting rights shall submit a list

 

of nominees in each population category to the state transportation

 

commission. The state transportation commission shall make the

 

appointments from the lists submitted under this subsection. Names

 

shall be submitted within 45 days after October 1, 2004. The state

 

transportation commission shall make the appointments by January

 

30, 2005. Voting members shall be appointed for 2 years. The

 

chairperson of the board shall be selected from among the voting

 

members of the board. In addition to the 2 nonvoting members, the

 

department shall provide qualified administrative staff and

 

qualified technical assistance to the board.

 

     (5) (6) Beginning October 1, 2005, no No less than 5% and no

 

more than 15% of the funds money received in the local bridge fund

 

may be used for critical repair of large bridges and emergencies as

 

determined by the local bridge advisory board. Beginning October 1,

 

2005, funds Money remaining after the funds money allocated for

 

critical large bridge repair and emergencies are deducted shall be

 

distributed by the board to the regional bridge councils created

 

under this section. One regional council shall be formed for each

 

department of transportation region as those regions exist on

 

October 1, 2004. The regional councils shall consist of 2 members

 

of the county road association of Michigan from counties in the

 

region, 2 members of the Michigan municipal league from cities and

 

villages in the region, and 1 member of the state transportation

 

department in each region. The members of the state transportation

 

department shall be nonvoting members who shall provide qualified

 

administrative staff and qualified technical assistance to the

 

regional councils.

 

     (6) (7) Beginning October 1, 2005, funds Money in the local

 

bridge fund after deduction of the amounts set aside for critical

 

repair of large bridges and emergency repairs shall be distributed

 

among the regional bridge councils according to all of the

 

following ratios, which shall be assigned a weight expressed as a

 

percentage as determined by the board, with each ratio receiving no

 

greater than a 50% weight and no less than a 25% weight:

 

     (a) A ratio with a numerator that is the total number of local

 

bridges in the region and a denominator that is the total number of

 

local bridges in this state.

 

     (b) A ratio with a numerator that is the total local bridge

 

deck area in the region and a denominator that is the total local

 

bridge deck area in this state.

 

     (c) A ratio with a numerator that is the total amount of

 

structurally deficient local bridge deck area in the region and a

 

denominator that is the total amount of structurally deficient

 

local bridge deck area in this state.

 

     (7) (8) Beginning October 1, 2005, the The regional bridge

 

councils shall allocate the funds money received from the board for

 

the preservation, improvement, and reconstruction of existing

 

bridges or for the construction of bridges to replace existing

 

bridges in whole or in part in each region.

 

     (8) (9) Beginning January 1, 2007 and each Each January, after

 

2007, the department shall submit a report to the chair and the

 

minority vice-chair of the appropriations committees of the senate

 

and the house of representatives, and to the standing committees on

 

transportation of the senate and the house of representatives, on

 

all of the following activities for the previous state fiscal year:

 

     (a) A listing of how much money was dedicated for emergency

 

and large bridge repair.

 

     (b) A listing of what emergency and large bridge repair

 

projects were funded.

 

     (c) The actual weights used in the calculation required under

 

subsection (7).(6).

 

     (d) A listing of the total money distributed to each region.

 

     (e) A listing of what specific projects were funded pursuant

 

to subsection (8).(7).

 

     (9) (10) The state transportation commission shall borrow

 

money and issue notes or bonds in an amount of not less than

 

$30,000,000.00 to supplement the funding provided for the local

 

bridge program under subsection (6) (5). The bonds or notes issued

 

pursuant to this subsection may be issued by the commission for any

 

purpose for which other local bridge funds money may be used under

 

this section. The bonds or notes authorized by this subsection

 

shall be issued by resolution of the state transportation

 

commission consistent with the requirements of section 18b.

 

     (10) (11) The state transportation department shall promulgate

 

rules pursuant to the administrative procedures act of 1969, 1969

 

PA 306, MCL 24.201 to 24.328, governing the administration of the

 

local bridge program. The rules shall set forth the eligibility

 

criteria for financial assistance under the program and other

 

matters related to the program that the department considers

 

necessary and desirable. The department shall take into

 

consideration the availability of federal aid and other financial

 

resources of the highway authority responsible for the bridge, the

 

importance of the bridge to the highway, road, or street network,

 

and the condition of the existing bridge.

 

     (11) (12) Beginning October 1, 2004, the The revenue

 

appropriated to the local bridge fund pursuant to subsection (1)(d)

 

(1)(e) shall be distributed only to the local bridge advisory

 

board, the regional bridge councils, cities, villages, and county

 

road commissions.

 

     (12) (13) Beginning October 1, 2008, the The regional bridge

 

councils shall determine what bridge projects are selected for

 

funding from the local bridge fund created in subsection (5) (4)

 

and shall make a list of selected projects available to interested

 

parties in the region. A determination that a bridge project is

 

selected for funding in a given fiscal year is not approval to

 

disburse the funds.money.

 

     (13) (14) Beginning October 1, 2008, a A county road

 

commission, city, or village may implement a bridge project if the

 

bridge project has been selected for funding and is included in the

 

appropriate regional bridge council's current multiyear bridge plan

 

for the local bridge program but the regional bridge council has

 

not allocated funds money to the bridge project for the fiscal year

 

that the bridge project is on the current multiyear bridge plan. A

 

county road commission, city, or village may borrow funds money to

 

implement a project that has been selected for funding and is

 

included in the appropriate regional bridge council's current

 

multiyear bridge plan but has not been allocated funds money by the

 

regional bridge council. Based on available local bridge funds

 

money, when a bridge project that was implemented with borrowed

 

funds money is allocated funding in a subsequent fiscal year, the

 

funding shall only be used to repay the amount approved by the

 

multiyear bridge plan when the funds were money was borrowed. To be

 

eligible for repayment of the amount borrowed, a bridge project

 

that has been implemented with borrowed funds money shall be

 

administered through the department's local bridge program.

 

     Sec. 11. (1) A fund to be known as the state trunk line fund

 

is established and shall be set up and maintained in the state

 

treasury as a separate fund. The money deposited in the state trunk

 

line fund is appropriated to the state transportation department

 

for the following purposes in the following order of priority:

 

     (a) For the payment, but only from money restricted as to use

 

by section 9 of article IX of the state constitution of 1963, of

 

bonds, notes, or other obligations in the following order of

 

priority:

 

     (i) For the payment of contributions required to be made by the

 

state highway commission or the state transportation commission

 

under contracts entered into before July 18, 1979, under 1941 PA

 

205, MCL 252.51 to 252.64, which contributions have been pledged

 

before July 18, 1979, for the payment of the principal and interest

 

on bonds issued under 1941 PA 205, MCL 252.51 to 252.64, for the

 

payment of which a sufficient sum is irrevocably appropriated.

 

     (ii) For the payment of the principal and interest upon bonds

 

designated "State of Michigan, State Highway Commissioner, Highway

 

Construction Bonds, Series I", dated September 1, 1956, in the

 

aggregate principal amount of $25,000,000.00, issued pursuant to

 

former 1955 PA 87 and the resolution of the state administrative

 

board adopted August 6, 1956, for the payment of which a sufficient

 

sum is irrevocably appropriated.

 

     (iii) For the payment of the principal and interest on bonds

 

issued under section 18b for transportation purposes other than

 

comprehensive transportation purposes as defined by law and the

 

payment of contributions of the state highway commission or state

 

transportation commission 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 under the

 

authorization of section 18d and contracts executed pursuant to

 

that section. A sufficient portion of the fund is irrevocably

 

appropriated to pay, when due, the principal and interest on bonds

 

or notes issued under section 18b for purposes other than

 

comprehensive transportation purposes as defined by law, and to pay

 

the annual contributions of the state highway commission and the

 

state transportation commission as are pledged for the payment of

 

bonds issued pursuant to contracts authorized by section 18d.

 

     (b) For the transfer of funds money appropriated pursuant to

 

section 10(1)(g) 10(1)(i) to the transportation economic

 

development fund, but the transfer shall be reduced each fiscal

 

year by the amount of debt service to be paid in that year from the

 

state trunk line fund for bonds, notes, or other obligations issued

 

to fund projects of the transportation economic development fund,

 

which amount shall be certified by the department.

 

     (c) For the transfer of funds money appropriated pursuant to

 

section 10(1)(a) to the railroad grade crossing account in the

 

state trunk line fund for expenditure for rail grade crossing

 

improvement purposes at rail grade crossings on public roads and

 

streets under the jurisdiction of the this state, counties, cities,

 

or villages. Projects shall be selected for funding in accordance

 

with the following:

 

     (i) Not more than 50% or less than 30% of these funds this

 

money and matched federal funds money shall be expended for state

 

trunk line projects.

 

     (ii) In prioritizing projects for these funds this money, in

 

whole or in part, the department shall consider train and vehicular

 

traffic volumes, accident history, traffic control device

 

improvement needs, and the availability of funding.

 

     (iii) Consistent with the other requirements for these funds

 

this money, the first priority for funds money deposited pursuant

 

to this subdivision for rail grade crossing improvements and

 

retirement shall be to match federal funds money from the railroad-

 

highway grade crossing improvement program or other comparable

 

federal programs if a match is required under federal law.

 

     (iv) If the department and the road authority with jurisdiction

 

over the crossing formally agree that the grade crossing should be

 

eliminated by permanent closing of the public road or street, the

 

physical removal of the crossing, roadway within railroad rights of

 

way and street termination treatment will be negotiated between the

 

road authority and railroad company. The funds money provided to

 

the road authority as a result of the crossing closure will be

 

credited to its account representing the same road or street system

 

on which the crossing is located and shall be used for any

 

transportation purpose within that road authority's jurisdiction.

 

     (d) For the transfer of money appropriated pursuant to section

 

10(1)(b) to the grade crossing surface account in the state trunk

 

line fund for expenditure for rail grade crossing surface

 

improvement purposes at rail grade crossings on public roads and

 

streets under the jurisdiction of counties, cities, or villages.

 

Projects shall be selected for funding in accordance with the

 

following:

 

     (i) In prioritizing projects, the department shall consider

 

vehicular traffic volumes, relative crossing surface condition, the

 

ability of the railroad and local road authority to make

 

coordinated improvements, and the availability of funding.

 

     (ii) The grade crossing surface account shall fund 60% of the

 

project cost, with the remaining 40% funded by the railroad

 

company.

 

     (iii) Funding under the grade crossing surface account will be

 

limited to those items of work that are normally the responsibility

 

of the railroad under section 309 of the railroad code of 1993,

 

1993 PA 354, MCL 462.309. Maintenance of the roadway approaches to

 

the crossing will continue to be the responsibility of the party

 

with jurisdiction over that roadway.

 

     (e) (d) For the total operating expenses of the state trunk

 

line fund for each fiscal year as appropriated by the legislature.

 

     (f) (e) For the preservation of state trunk line highways and

 

bridges.

 

     (g) (f) For the opening, widening, improving, construction,

 

and reconstruction of state trunk line highways and bridges,

 

including the acquisition of necessary rights of way and the work

 

incidental to that opening, widening, improving, construction, or

 

reconstruction. Those sums Money in the state trunk line fund not

 

otherwise appropriated, distributed, determined, or set aside by

 

law shall be used for the construction or reconstruction of the

 

national system of interstate and defense highways, referred to in

 

this act as "the interstate highway system" to the extent necessary

 

to match federal aid funds money as the federal aid funds become

 

money becomes available for that purpose; and, for the construction

 

and reconstruction of the state trunk line system.

 

     (h) (g) The state transportation department may enter into

 

agreements with county road commissions and with cities and

 

villages to perform work on a highway, road, or street. The

 

agreements may provide for the performance by any of the

 

contracting parties of any of the work contemplated by the contract

 

including engineering services and the acquisition of rights of way

 

in connection with the work, by purchase or condemnation by any of

 

the contracting parties in its own name, and for joint

 

participation in the costs, but only to the extent that the

 

contracting parties are otherwise authorized by law to expend money

 

on the highways, roads, or streets. The state transportation

 

department also may contract with a county road commission, city,

 

and or village to advance money to a the county road commission,

 

city, and or village to pay their costs of improving railroad grade

 

crossings on the terms and conditions agreed to in the contract. A

 

contract may be executed before or after the state transportation

 

commission borrows money for the purpose of advancing money to a

 

county road commission, city, or village, but the contract shall be

 

executed before the advancement of any money to a the county road

 

commission, city, or village by the state transportation

 

commission, and shall provide for the full reimbursement of any

 

advancement by a the county road commission, city, or village to

 

the state transportation department, with interest, within 15 years

 

after advancement, from any available revenue sources of the county

 

road commission, city, or village or, if provided in the contract,

 

by deduction from the periodic disbursements of any money returned

 

by the state to the county road commission, city, or village.

 

     (i) (h) For providing inventories of supplies and materials

 

required for the activities of the state transportation department.

 

The state transportation department may purchase supplies and

 

materials for these purposes, with payment to be made out of the

 

state trunk line fund to be charged on the basis of issues from

 

inventory in accordance with the accounting and purchasing laws of

 

this state.

 

     (2) Notwithstanding any other provision of this act, at least

 

90% of state revenue appropriated annually to the state trunk line

 

fund less the amounts described in subdivisions (a) to (i) shall be

 

expended annually by the state transportation department for the

 

preservation of highways, roads, streets, and bridges and for the

 

payment of debt service on bonds, notes, or other obligations

 

described in subsection (1)(a) issued after July 1, 1983, for the

 

purpose of providing funds money for the preservation of highways,

 

roads, streets, and bridges. Of the amounts appropriated for state

 

trunk line projects, the department shall, where possible, secure

 

warranties of not less than 5-year full replacement guarantee for

 

contracted construction work. If an appropriate certificate is

 

filed under section 18e but only to the extent necessary, this

 

subsection shall does not prohibit the use of any amount of money

 

restricted as to use by section 9 of article IX of the state

 

constitution of 1963 and deposited in the state trunk line fund for

 

the payment of debt service on bonds, notes, or other obligations

 

pledging for the payment thereof money restricted as to use by

 

section 9 of article IX of the state constitution of 1963 and

 

deposited in the state trunk line fund, whenever issued, as

 

specified under subsection (1)(a). The amounts which that are

 

deducted from the state trunk line fund for the purpose of the

 

calculation required by this subsection are as follows:

 

     (a) Amounts expended for the purposes described in subsection

 

(1)(a) for the payment of debt service on bonds, notes, or other

 

obligations issued before July 2, 1983.

 

     (b) Amounts expended to provide the state matching requirement

 

for projects on the national highway system and for the payment of

 

debt service on bonds, notes, or other obligations issued after

 

July 1, 1983, for the purpose of providing funds money for the

 

state matching requirements for projects on the national highway

 

system.

 

     (c) Amounts expended for the construction of a highway,

 

street, road, or bridge to 1 or more of the following or for the

 

payment of debt service on bonds, notes, or other obligations

 

issued after July 1, 1983, for the purpose of providing funds money

 

for the construction of a highway, street, road, or bridge to 1 or

 

more of the following:

 

     (i) A location for which a building permit has been obtained

 

for the construction of a manufacturing or industrial facility.

 

     (ii) A location for which a building permit has been obtained

 

for the renovation of, or addition to, a manufacturing or

 

industrial facility.

 

     (d) Amounts expended for capital outlay other than for

 

highways, roads, streets, and bridges or to pay debt service on

 

bonds, notes, or other obligations issued after July 1, 1983, for

 

the purpose of providing funds money for capital outlay other than

 

for highways, roads, streets, and bridges.

 

     (e) Amounts expended for the operating expenses of the state

 

transportation department other than the units of the department

 

performing the functions assigned on January 1, 1983 to the bureau

 

of highways.

 

     (f) Amounts expended pursuant to contracts entered into before

 

January 1, 1983.

 

     (g) Amounts expended for the purposes described in subsection

 

(5).

 

     (h) Amounts appropriated for deposit in the transportation

 

economic development fund and the rail grade crossing account

 

pursuant to section 10(1)(g) 10(1)(i) and 10(1)(a).

 

     (i) Upon the affirmative recommendation of the director of the

 

state transportation department and the approval by resolution of

 

the state transportation commission, those amounts expended for

 

projects vital to the economy of this state, a region, or local

 

area or the safety of the public. The resolution shall state the

 

cost of the project exempted from this subsection.

 

     (3) Notwithstanding any other provision of this act, the state

 

transportation department shall expend annually at least 90% of the

 

federal revenue distributed to the credit of the state trunk line

 

fund in that year, except for federal revenue expended for the

 

purposes described in subsection (2)(b), (c), (f), and (i) and for

 

the payment of notes issued under section 18b(9) on the

 

preservation of highways, roads, streets, and bridges. The

 

requirement of this subsection shall be waived if compliance would

 

cause this state to be ineligible according to federal law for

 

federal revenue, but only to the extent necessary to make this

 

state eligible according to federal law for that revenue.

 

     (4) Notwithstanding any other provision of this section, the

 

state transportation department may loan money to county road

 

commissions, cities, and villages for paying capital costs of

 

transportation purposes described in the second paragraph of

 

section 9 of article IX of the state constitution of 1963 from the

 

proceeds of bonds or notes issued pursuant to section 18b or from

 

the state trunk line fund. Loans made directly from the state trunk

 

line fund shall be made only after provision of funds money for the

 

purposes specified in subsection (1)(a) to (f) (g). Loans described

 

in this subsection are not subject to the revised municipal finance

 

act, 2001 PA 34, MCL 141.2101 to 141.2821.

 

     (5) County road commissions, cities, and villages may borrow

 

money from the proceeds of bonds or notes issued under section 18b

 

or the state trunk line fund for the purposes set forth in

 

subsection (4) that shall be repayable, with interest, from 1 or

 

more of the following:

 

     (a) The money to be received by the county road commission,

 

city, or village from the Michigan transportation fund, except to

 

the extent the money has been or may in the future be pledged by

 

contract in accordance with 1941 PA 205, MCL 252.51 to 252.64, or

 

has been or may in the future be pledged for the payment of the

 

principal and interest upon notes issued pursuant to 1943 PA 143,

 

MCL 141.251 to 141.254, or has been or may in the future be pledged

 

for the payment of principal and interest upon bonds issued under

 

section 18c or 18d, or has been or may in the future be pledged for

 

the payment of the principal and interest upon bonds issued

 

pursuant to 1952 PA 175, MCL 247.701 to 247.707.

 

     (b) Any other legally available funds of the city, village, or

 

county road commission, other than the general funds of the county.

 

     (6) Loans made pursuant to subsection (4) if required by the

 

state transportation department may be payable by deduction by the

 

state treasurer, upon direction of the state transportation

 

department, from the periodic disbursements of any money returned

 

by the state under this act to the county road commission, city, or

 

village, but only after sufficient money has been returned to the

 

county road commission, city, or village to provide for the payment

 

of contractual obligations incurred or to be incurred and principal

 

and interest on notes and bonds issued or to be issued under 1941

 

PA 205, MCL 252.51 to 252.64, 1943 PA 143, MCL 141.251 to 141.254,

 

1952 PA 175, MCL 247.701 to 247.707, or section 18c or 18d. The

 

interest rates and payment schedules of any loans made from the

 

proceeds of bonds or notes issued pursuant to section 18b shall be

 

established by the state transportation department to conform as

 

closely as practicable to the interest rate and repayment schedules

 

on the bonds or notes issued to make the loans. However, the state

 

transportation department may allow for the deferral of the first

 

payment of interest or principal on the loans for a period of not

 

to exceed 1 year after the respective first payment of interest or

 

principal on the bonds or notes issued to make the loans.

 

     (7) The amount borrowed by a county road commission, city, or

 

village pursuant to subsection (5) shall not be included in, or

 

charged against, any constitutional, statutory, or charter debt

 

limitation of the county, city, or village and shall not be

 

included in the determination of the maximum annual principal and

 

interest requirements of, or the limitations upon, the maximum

 

annual principal and interest incurred under 1941 PA 205, MCL

 

252.51 to 252.64, 1943 PA 143, MCL 141.251 to 141.254, 1952 PA 175,

 

MCL 247.701 to 247.707, or section 18c or 18d.

 

     (8) The county road commission, city, or village is not

 

required to seek or obtain the approval of the electors, the

 

municipal finance commission or its successor agency, or, except as

 

provided in this subsection, the department of treasury to borrow

 

money pursuant to subsection (5). The borrowing is not subject to

 

the revised municipal finance act, 2001 PA 34, MCL 141.2101 to

 

141.2821, or to section 5(g) of the home rule city act, 1909 PA

 

279, MCL 117.5. The state transportation department shall give at

 

least 10 days' notice to the state treasurer of its intention to

 

make a loan under subsection (4). If the state treasurer gives

 

notice to the director of the state transportation department

 

within 10 days of receiving the notice from the state

 

transportation department, that, based upon the then existing

 

financial or credit situation of the county road commission, city,

 

or village, it would not be in the best interests of the state to

 

make a loan under subsection (4) to the county road commission,

 

city, or village, the loan shall not be made unless the state

 

treasurer, after a hearing, if requested by the affected county

 

road commission, city, or village, subsequently gives notice to the

 

director of the state transportation department that the loan may

 

be made on the conditions that the state treasurer specifies.

 

     (9) The state transportation commission may borrow money and

 

issue bonds and notes under, and pursuant to the requirements of,

 

section 18b to make loans to county road commissions, cities, and

 

villages for the purposes described in the second paragraph of

 

section 9 of article IX of the state constitution of 1963, as

 

provided in subsection (4). A single issue of bonds or notes may be

 

issued for the purposes specified in subsection (4) and for the

 

other purposes specified in section 18b. The house and senate

 

transportation appropriations subcommittees shall be notified by

 

the department if there are extras and overruns sufficient to

 

require approval of either the state administrative board or the

 

commission, or both, on any contract between the department and a

 

local road agency or a private business.

 

     (10) The director of the state transportation department,

 

after consultation with representatives of the interests of county

 

road commissions, cities, and villages, shall establish, by

 

intergovernmental communication, procedures for the implementation

 

and administration of the loan program established under

 

subsections (4) to (9).

 

     (11) Not more than 10% per year of all of the funds received

 

by and returned to the state transportation department from any

 

source for the purposes of this section may be expended for

 

administrative expenses. The department shall be subject to section

 

14(5) if more than 10% per year is expended for administrative

 

expenses. 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 do not include net equipment expense,

 

net capital outlay, debt service principal and interest, and or

 

payments to other state or local offices which that are assigned,

 

but not limited to, specific road construction projects or

 

preservation activities.

 

     (12) Any performance audits of the department shall be

 

conducted according to government auditing standards issued by the

 

United States general accounting office.

 

     (13) Contracts entered into to advance money to a county road

 

commission, city, or village under subsection (1)(g) (1)(h) are not

 

subject to the revised municipal finance act, 2001 PA 34, MCL

 

141.2101 to 141.2821.

 

     (14) As used in this section, "rail grade crossing improvement

 

purposes" means 1 or more of the following:

 

     (a) The installation and modernization of active and passive

 

warning devices at railroad grade crossings.

 

     (b) The installation or improvement of grade crossing

 

surfaces.

 

     (c) Modification, relocation, or modernization of railroad

 

grade crossing active and passive warning devices necessitated by

 

roadway improvement projects.

 

     (d) Test installations of innovative warning devices or other

 

innovative applications.

 

     (e) Construction of new grade separations.

 

     (f) A cash incentive payment made pursuant to subsection

 

(1)(c)(iv) for any public road or street crossing, in an amount no

 

greater than the cost of installing flashing light signals and half

 

roadway gates at the crossing.

 

     (g) Any other work that would be eligible for funding under

 

the federal railroad-highway grade crossing improvement program or

 

other comparable programs.

 

     Sec. 11f. (1) Funds Money received under the local federal

 

match program created in section 11e shall be granted to local

 

municipalities and other local road agencies to match federal aid

 

projects as provided in this subsection. Projects shall be

 

submitted to the state transportation department by the local

 

municipality or other local road agency. The department shall

 

review the submittals and apply criteria that take into account the

 

needs of highway, road, and street systems and an equitable

 

allocation of available funds money considering the geographic

 

location of the proposed project. If the projects meet the

 

criteria, the state transportation department shall award grants to

 

the extent of available funds money. An individual grant shall not

 

exceed 25% of the amount of federal funds money available for the

 

project. Projects selected for funding shall meet all of the

 

following criteria:

 

     (a) Except for projects described in subdivision (d)(iv), the

 

project shall be under construction or let for bid no later than

 

September 5, 2008.

 

     (b) The applicant shall have identified all of the necessary

 

funding to complete the project.

 

     (c) The project shall be for the opening, widening, improving,

 

construction, or reconstruction of a federal aid eligible road or

 

street, including the work incidental to that opening, widening,

 

improving, construction, or reconstruction.

 

     (d) The project shall be 1 or more of the following:

 

     (i) Projects that are the subject of a federal appropriation in

 

the safe, accountable, flexible, efficient transportation equity

 

act, a legacy for users (SAFETEA-LU), Public Law 109-59, or the

 

transportation equity act for the 21st century, Public Law 105-178,

 

and that have been designated as high priority road and bridge

 

projects, and that can be let for bid no later than April 4, 2008.

 

     (ii) Projects that are not the subject of a federal

 

appropriation in the safe, accountable, flexible, efficient

 

transportation equity act, a legacy for users (SAFETEA-LU), Public

 

Law 109-59, or the transportation equity act for the 21st century,

 

Public Law 105-178, that have received earmarks in the federal

 

budget, and that can be let for bid no later than April 4, 2008.

 

     (iii) Projects that are for federal aid eligible roads and that

 

are scheduled to be under construction or let for bid during the

 

fiscal year that begins October 1, 2008 or a later fiscal year, and

 

that can be advanced to the fiscal year that begins October 1,

 

2007, and that can be let for bid no later than September 5, 2008.

 

     (iv) Projects that are the subject of a federal appropriation

 

in the safe, accountable, flexible, efficient transportation equity

 

act, a legacy for users (SAFETEA-LU), Public Law 109-59, or the

 

transportation equity act for the 21st century, Public Law 105-178,

 

and have been designated as high priority road and bridge projects

 

from the following list as determined by the department:

 

     (A) Romeo Plank, construction of 5 lane concrete pavement with

 

curb, gutter, and sewer on Romeo Plank Road from M-59 to 23 Mile

 

Road in Macomb Township.

 

     (B) Finkbeiner Road, construct improvements to Crane &

 

Finkbeiner Road from Patterson Road to Whitneyville Road in Barry

 

County, and new bridge over Thornapple River.

 

     (C) CR 492, Marquette County, realignment of 3200 feet of

 

County Road 492 from U.S. 41 north to County Road HD.

 

     (D) H-58, Alger County, reconstruct, pave, and some

 

realignment of H-58 from 2600 feet south of Little Beaver Lake Road

 

to 4600 feet east of Hurricane River.

 

     (E) Westland, Ann Arbor Trail between Farmington and Inkster,

 

Warren/Newburgh intersection, reconstruction.

 

     (F) Port Huron, NAFTA corridor congestion mitigation project,

 

grade separation, integrated highway realignment at Port Huron,

 

Michigan to eliminate road blockages from NAFTA rail traffic.

 

     (G) Muskegon County, City of Muskegon: study and implement

 

transportation system alternatives in the vicinity of U.S. 31/M 46.

 

Quarterline Rd, Laketon to McArthur, US-31/M-46 vicinity.

 

Transportation system improvements on Quarterline Road from Laketon

 

Avenue to Stebbins Road. Project description; right-of-way

 

acquisition, road relocation, road reconstruction/resurfacing and

 

signal improvements.

 

     (2) Except for projects described in subsection (1)(d)(iv), all

 

bond proceeds not used to fund grants awarded by September 5, 2008

 

are appropriated for the purposes described in section

 

11(1)(f).11(1)(g).

 

     (3) Beginning February 1, 2007, the The department shall

 

submit a written report to the legislature by each February 1

 

containing all of the following information:

 

     (a) The balance contained in the program.

 

     (b) A list of all projects currently funded under the program.

 

     (c) A list of all federal high priority projects eligible for

 

funding under the program.

 

     (d) A list of pending requests for funding under the program,

 

if any.

 

     (4) The department shall submit a written report to the

 

legislature no later than 30 days after the program has expended

 

$40,000,000.00. The report shall contain all of the following:

 

     (a) A list of all projects currently funded under the program.

 

     (b) A list of federal high priority projects eligible to

 

receive funding from the program.

 

     (c) A list of pending requests for funding under the program,

 

if any.

 

     (5) The department shall provide additional criteria if

 

necessary for selecting the remaining projects to be funded in a

 

fiscal year no later than 30 days after the report required under

 

subsection (4) is issued. In determining the additional criteria to

 

apply to the remaining funds money, the department shall consult

 

with interested local road agencies, the Michigan municipal league,

 

and the county road association of Michigan and shall utilize any

 

recommendations made on additional criteria by these entities

 

unless the department determines that the additional criteria are

 

inequitable or impractical. If the additional criteria are deemed

 

inequitable or impractical, the department is directed to work with

 

the interested parties to develop equitable and practical criteria.

 

The department shall apply those criteria that most equitably

 

distribute the remaining funds money considering the geographic

 

location of the funded projects. In applying criteria, the

 

department shall take into account the needs of highway, road, and

 

street systems and an equitable allocation of available funds money

 

considering the geographic location of the funded project.