SB-0195,As Passed Senate, March 6, 2003

SUBSTITUTE FOR

SENATE BILL NO. 195

                                                                             A bill to provide for the approval of certain contracts                           

involving the operation of city and village water and sewer                 

systems; to require certain policies and procedures in the                  

awarding of contracts; and to provide for the powers and duties             

of certain governmental officials and entities.                             

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

1       Sec. 1.  Pursuant to section 27 of article VII of the state                 

2   constitution of 1963 and any other applicable law, an authority             

3   created under this act is an agency and instrumentality of the              

4   state that has all of the powers of a public corporation in the             

5   exercising of its duties under this act.                                    

6       Sec. 2.  On or before February 1 of each year, the chief                    

7   financial officer for a water or sewer system shall prepare and             

8   submit to each member of the system's authority a proposed budget           

9   for the next succeeding fiscal year covering its anticipated                

1   expenses of administration, operation, maintenance, and contract            

2   procurements.                                                               

3       Sec. 3.  An authority shall establish policies and                          

4   procedures for the contracting of services for the system.  The             

5   policies and procedures shall provide for all of the following:             

6       (a) The authority shall review and approve all contracts or                 

7   appropriations in an amount greater than $50,000.00, and such               

8   contracts or appropriations are void and unenforceable unless               

9   approved by the authority.                                                  

10      (b) The authority shall review and approve all contract                     

11  overruns from the original contract amount for contracts approved           

12  under subdivision (a) and for contracts less than $50,000.00 if             

13  the overrun causes the contract amount to exceed $50,000.00.                

14      (c) Except as otherwise provided by this act, a contract                    

15  shall not be awarded by the system for the construction, repair,            

16  remodeling, or demolition of a water or sewer facility unless the           

17  contract is let pursuant to a procedure that requires competitive           

18  bidding.  This subdivision does not apply if the authority                  

19  determines that any of the following apply:                                 

20                                                                               (i) The negotiated contract amount is less than $50,000.00.                         

21      (ii) The contract is for emergency repair or construction                    

22  necessitated by a sudden, unforeseen occurrence or situation of a           

23  serious and urgent nature and is not for convenience or                     

24  expediency.  A contract under this subparagraph shall not be for            

25  a period greater than 1 year.                                               

26      (iii) The repair or construction is necessary to ensure                      

27  safety or to otherwise protect life or property.  A contract                

1   under this subparagraph shall not be for a period greater than 1            

2   year.                                                                       

3       (iv) That procurement by competitive bids is not practicable                 

4   to efficiently and effectively meet the water and sewer system              

5   needs, or that another procurement method is in the public's best           

6   interests.                                                                  

7       (d) The policies and procedures for hiring of professional                  

8   service contractors.                                                        

9       Sec. 4.  The authority is a public body for purposes of                     

10  reporting violations or suspected violations of a law or                    

11  regulation or rule promulgated under the law of this state, a               

12  political subdivision of this state, or the United States.  A               

13  person reporting a violation or suspected violation under this              

14  section shall have all the protections provided under the                   

15  whistleblowers' protection act, 1980 PA 469, MCL 15.361 to                  

16  15.369.                                                                     

17      Sec. 5.  (1) A water or sewer system shall not charge a                     

18  customer more than that allowed under the contract to provide               

19  services.                                                                   

20      (2) A customer may file a complaint with the water or sewer                 

21  system to recover any amounts allowed under this section.                   

22      (3) A complaint under subsection (2) shall be filed no later                

23  than 12 months from the date a payment was made as a result of a            

24  violation of this section.                                                  

25      (4) If a water or sewer system is found to have charged an                  

26  amount in violation of this section, the system shall pay to or             

27  credit the account of the customer an amount equal to 10 times              

Senate Bill No. 195 as amended March 5, 2003                                

1   the overcharge or $100.00, whichever is greater.                            

   <<Sec. 6. If a qualified county, qualified city, or a local unit of government charges its customers a rate that generates an amount greater than the amount that the county, city, or local unit is required to pay under its contract with the water or sewer system, the county, city, or local unit shall annually itemize on the customer's bill the additional charges.>>

2       Enacting section 1.  This act does not take effect unless                   

3   House Bill No. 4206 of the 92nd Legislature is enacted into law.