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2012 House Bill 5566: Increase school and local“deficit spending” debt

Public Act 284 of 2012

Introduced by Rep. Cindy Denby (R) on April 24, 2012 To greatly increase the level of borrowing from the state that school districts and local governments can use to cover “deficit spending” that exceeds their current revenues. Specifically, under House Bills 5566 to 5570, a $5 million annual cap on this state lending would increase to $100 million each year through 2018, and the maximum amount per loan would increase from $3 million to $20 million.   Official Text and Analysis.
Referred to the House Local, Intergovernmental, and Regional Affairs Committee on April 24, 2012
Reported in the House on May 30, 2012 With the recommendation that the substitute (H-2) be adopted and that the bill then pass.
Substitute offered in the House on June 7, 2012
The substitute passed by voice vote in the House on June 7, 2012
Amendment offered by Rep. Woodrow Stanley (D) on June 7, 2012 To limit the application of some of the proposed requirements and restrictions to Detroit and the Detroit school district.
The amendment passed by voice vote in the House on June 7, 2012
Amendment offered by Rep. Tom McMillin (R) on June 7, 2012 To prohibit pay raises for employees of a city or school district that is given a deficit spending loan authorized by the bill until the loan is repaid.
The amendment failed by voice vote in the House on June 7, 2012
Amendment offered by Rep. Tom McMillin (R) on June 7, 2012 To require a city that is given a deficit spending loan authorized by the bill to comply with the 2011 law that required higher employee health insurance contributions. That bill allowed cities (but not schools) to opt-out of its provisions.
The amendment passed by voice vote in the House on June 7, 2012
Amendment offered by Rep. Cindy Denby (R) on June 7, 2012 To revise details of loans to a school district from advances from the state school aid fund.
The amendment passed by voice vote in the House on June 7, 2012
Amendment offered by Rep. Earl Poleski (R) on June 7, 2012 To require that interest on loans authorized by the bill be no less than the average rate on 10 year municipal bonds, and allow higher rates.
The amendment passed by voice vote in the House on June 7, 2012
Amendment offered by Rep. Al Pscholka (R) on June 7, 2012 To allow the state to raise the rates or accellerate the required repayment period of a loan if the municipality or school district is not in compliance with deficit reduction plans required by the bill.
The amendment passed by voice vote in the House on June 7, 2012
Passed 73 to 34 in the House on June 7, 2012 (same description)
To greatly increase the level of borrowing from the state that school districts and local governments can use to cover “deficit spending” that exceeds their current revenues. Specifically, under House Bills 5566 to 5570, a $5 million annual cap on this state lending would increase to $100 million each year through 2018, and the maximum amount per loan would increase from $3 million to $20 million.
Received in the Senate on June 12, 2012
Referred to the Senate Appropriations Committee on June 12, 2012
Reported in the Senate on July 18, 2012 With the recommendation that the substitute (S-5) be adopted and that the bill then pass.
Substitute offered in the Senate on July 18, 2012 To replace the previous version of the bill with one that increases the amount of deficit spending loans by a slightly lesser amount.
The substitute passed by voice vote in the Senate on July 18, 2012
Passed 27 to 10 in the Senate on July 18, 2012 To greatly increase the level of borrowing from the state that school districts and local governments can use to cover “deficit spending” that exceeds their current revenues. Specifically, under House Bills 5566 to 5570, a $5 million annual cap on this state lending would increase to $85 million each year through 2018, and the maximum amount per loan would increase from $3 million to $20 million. Short term, this would primarily authorize state money for the Benton Harbor, Muskegon Heights, Highland Park and Pontiac school districts.
Motion by Sen. Tupac Hunter (D) on July 18, 2012 To give the bill immediate effect.
The motion passed 28 to 8 in the Senate on July 18, 2012
Received in the House on July 18, 2012
Passed 81 to 22 in the House on July 18, 2012 To concur with the Senate-passed version of the bill, which authorizes slightly less new state debt.
Signed by Gov. Rick Snyder on August 1, 2012

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