Local government: authorities; revisions to the recreational authorities act; provide for, the official text

Act No. 12

Public Acts of 2026

Approved by the Governor

May 14, 2026

Filed with the Secretary of State

May 14, 2026

EFFECTIVE
DATE: May 14, 2026

state of michigan

103rd Legislature

Regular session of 2026

Introduced by Rep. Markkanen

ENROLLED HOUSE BILL No. 4694

AN ACT to amend 2000 PA 321,
entitled “An act to provide for the establishment of recreational authorities;
to provide powers and duties of an authority; to authorize the assessment of a
fee, the levy of a property tax, and the issuance of bonds and notes by an
authority; and to provide for the powers and duties of certain government
officials,” by amending sections 5, 7, 11, and 21 (MCL 123.1135, 123.1137,
123.1141, and 123.1151), sections 5 and 21 as amended by 2003 PA 135 and
section 11 as amended by 2016 PA 173, and by adding sections 5a, 9a, and 10.

The People of the State of
Michigan enact:

Sec.
5. (1) Except as otherwise provided in this section, 2 or more municipalities
or districts may establish a recreational authority. If the municipality,
municipalities, district, or districts are located in a county with a
population of less than 4,000, 1 or more municipalities or districts may
establish a recreational authority. A recreational authority is an authority
under section 6 of article IX of the state constitution of 1963. A recreational
authority under this act constitutes a governmental subdivision or unit of this
state and a public body corporate and politic. A recreational authority under
this act is a local unit of government or public authority under section 1901
of the natural resources and environmental protection act, 1994 PA 451, MCL
324.1901.

(2) To initiate the establishment of an authority, articles
of incorporation must be prepared. The articles of incorporation must include
all of the following:

(a) The name of the authority.

(b) The names of the participating municipality or
municipalities.

(c) A description of the territory of the authority.

(d) The size of the board of the authority, which must be
comprised of an odd number of members; the qualifications, method of selection,
and terms of office of board members; and the filling of vacancies in the
office of board member. If board members are elected in at-large elections by
the qualified and registered electors of the participating municipality or
municipalities, voting collectively, the election of board members must be
conducted under the same procedures that govern an election for a tax under
sections 13 to 17.

(e)
The purposes for which the authority is
established. Permissible purposes include the acquisition, construction,
operation, maintenance, or improvement of 1 or more of the following:

(i) A public swimming pool.

(ii) A public recreation center.

(iii) A public auditorium.

(iv) A public conference center.

(v) A public park.

(vi) A public museum.

(vii) A public historic farm.

(viii) If the territory of the authority is
located only in a county with a population of less than 4,000, a public forest
and natural resources area.

(f)
The procedure and
requirements for a municipality or district to become a participating
municipality in, and for a participating municipality to withdraw from, an
existing authority or to join in the original formation of an authority. For a
municipality or district to become a participating municipality in an existing
authority or to join in the original formation of an authority, a majority of
the electors of the municipality or district proposed to be included in the
territory of the authority and voting on the question shall approve a tax that
the authority has been authorized to levy by a vote of the electors of the
authority under section 11. A municipality or district shall not withdraw from
an authority during the period for which the authority has been authorized to
levy a tax by the electors of the authority.

(g)
Any other matters considered
advisable.

(h) If the authority’s purpose includes the acquisition,
construction, operation, maintenance, or improvement of a public forest and
natural resources area, the process by which the authority designates property
the authority owns as a public forest and natural resources area.

(3) The articles must be adopted by an affirmative vote of a
majority of the members serving on the legislative body of each participating
municipality. If a participating municipality is a district, the articles must
be adopted by an affirmative vote of a majority of the members serving on the
legislative body of the entire municipality. Unless the articles provide
otherwise, the requirements of this subsection do not apply to an amendment to
the articles to allow a municipality or district to become a participating
municipality in, or to allow a participating municipality to withdraw from, an
existing authority.

(4) Before the articles or amendments to the articles are
adopted, the articles or amendments to the articles must be published not less
than once in a newspaper generally circulated within the participating
municipality or municipalities. The adoption of articles or amendments to the
articles by a municipality or district must be evidenced by an endorsement on
the articles or amendments by the clerk of the municipality.

(5) After adoption of the articles or amendments to the
articles by each participating municipality, a printed copy of the articles or
the amended articles must be filed with the secretary of state by the clerk of
the last participating municipality to adopt the articles or amendments.

(6) The authority’s articles of incorporation, or amendments
to the articles, take effect on filing with the secretary of state.

Sec.
5a. (1) Subject to this
section and section 5, the articles may include, but are not limited to, any of
the following:

(a) Restrictions on the authority’s activities, including,
but not limited to, the sale of the authority’s assets or property.

(b) If the authority’s purpose includes the acquisition,
construction, operation, maintenance, or improvement of a public forest and
natural resources area, a provision to allow or require the authority to make
payments in lieu of taxes to 1 or more other governmental subdivisions or units
of this state in which the public forest and natural resources area is located,
including a participating municipality. The authority shall distribute the
payments to the various taxing units based on the portion of the public forest
and natural resources area each taxing unit is in and each taxing unit’s
millage rate, excluding millage levied under section 1211 of the revised school
code, 1976 PA 451, MCL 380.1211.

(c) If the authority has more than 1 participating
municipality, the allocation of the authority’s property, assets, and funds
among the municipalities on the dissolution of the authority.

(d) If the authority’s purpose includes the acquisition,
construction, operation, maintenance, or improvement of a public forest and
natural resources area, 1 or more of the following:

(i) One or more restrictions or limitations
on the use of a public forest and natural resources area or portions of a
public forest and natural resources area. The use restrictions or limitations
may prohibit 1 or more of the uses permitted in a public forest and natural
resources area under section 3(j).

(ii) A process by which 1 or more
restrictions or limitations on the use of a public forest and natural resources
area or portions of a public forest and natural resources area are established
by the authority, and the amendment or removal of the restrictions or
limitations.

(e) If the board of the authority is elected, whether the
election of the board is partisan or nonpartisan.

(2) The amendment of the articles is subject to the voting
requirements specified by the articles. If the articles do not specify a voting
requirement to amend the articles, the voting requirement to amend the articles
is the same as the voting requirement to adopt the articles.

(3) This section applies only if the territory of an
authority is located only in a county with a population
of less than 4,000.

Sec.
7. (1) A vacancy occurs on the board if any of the events set forth in section
3 of 1846 RS 15, MCL 201.3, occurs. Appointed members of the board, if any, may
be removed by the appointing authority for good cause after a public hearing.
Vacancies must be filled in the same manner as the original appointment, or as
otherwise provided in the articles, for the unexpired term.

(2) A majority of the members of the board constitutes a
quorum for the purpose of conducting business and exercising the powers of an
authority. Official action may be taken by an authority on the vote of a
majority of the board members present, unless the authority adopts bylaws
requiring a larger number.

(3) A member of the board may receive compensation for
services as a member of the board if approved in the articles and is entitled
to reimbursement for reasonable expenses, including expenses for travel
previously authorized by the board, incurred in the discharge of the board
member’s duties.

(4) The business that an authority performs must be conducted
at a public meeting of the authority held in compliance with the open meetings
act, 1976 PA 267, MCL 15.261 to 15.275. Public notice of the time, date, and
place of the meeting must be given in the manner required by the open meetings
act, 1976 PA 267, MCL 15.261 to 15.275.

(5) A writing prepared, owned, or used by an authority in the
performance of an official function must be made available in compliance with
the freedom of information act, 1976 PA 442, MCL 15.231 to 15.246.

(6) At its first meeting, a board shall elect a chairperson,
a secretary, a treasurer, and any other officers it considers necessary. A
board shall meet at least quarterly.

(7) A board may adopt bylaws to govern its procedures.

(8) A board may establish 1 or more committees to provide
advice on specific issues relevant to the authority. The board may determine
the qualifications required to serve on a committee created under this
subsection. Members of a committee created by a board under this subsection
serve at the pleasure of the board. Committees created under this subsection
may create volunteer subcommittees that do not serve at the pleasure of the
board.

Sec.
9a. If the territory of the authority is located only in a county with a
population of less than 4,000, an authority may do 1 or more of the following,
as permitted by the authority’s articles:

(a) Acquire and hold, by purchase, lease with or without
option to purchase, grant, gift, devise, land contract, installment purchase
contract, bequest, or other legal means, real and personal property inside or
outside the territory of the authority. The property may include franchises,
easements, or rights-of-way on, under, or above any property. The authority may
pay for the property from, or pledge for the payment of the property, revenue
of the authority. The authority may acquire land from this state, including,
but not limited to, land from any department, subdivision, or unit of this
state.

(b) Apply for and accept grants or contributions from
individuals, the federal government or any of its agencies, this state, a
municipality, or other public or private agencies to be used for any of the
purposes of the authority.

(c) Hire full-time or part-time employees and retain
professional services.

(d) Provide for the maintenance of all of the real and
personal property of the authority.

(e) Assess and collect fees for use of and access to property
that the authority owns or manages, and for services provided by and expenses
incurred by the authority.

(f) Receive revenue as appropriated by the legislature of
this state or a participating municipality or distribute funds of the authority
to any participating municipality.

(g) Enter into contracts incidental to or necessary for the
accomplishment of the purposes of the authority.

(h) Sell, lease, license, or develop real and personal
property held by the authority.

(i) Establish an endowment fund or other type of supporting
fund to support the purposes of the authority.

(j) Subject to applicable laws and contractual obligations of
the authority, make and enforce rules for the use of property the authority
owns, operates, or manages.

(k) Permit and manage sustainable natural resource commercial
activities, including, but not limited to, both of the following:

(i) The development, management, and
operation of sustainable commercial forestry.

(ii) The sale of carbon or other
environmental credits or tax attributes.

(l) Manage, maintain, and improve real and
personal property inside or outside the territory of the authority that is not
owned by the authority.

(m) Develop, construct, repair, and replace improvements to
property, including buildings.

(n) Sue or be sued in any court of this state.

Sec.
10. (1) Except as otherwise provided in this section, if an authority
dissolves, all property, funds, and assets of the authority are vested in the
participating municipality or municipalities. Except as otherwise provided in
the articles of an authority, if an authority dissolves, the debts or
liabilities of an authority do not become the debts or liabilities of the
participating municipality or municipalities unless the participating
municipality or municipalities have agreed to assume those debts or
liabilities. If the participating municipality or municipalities do not agree
to assume the authority’s debts and liabilities, an authority must not dissolve
unless the authority has repaid or settled all of the authority’s debts and
liabilities.

(2) If the property owned by an authority was designated by
the authority as a public forest and natural resources area, on dissolution of
the authority, the designated use of the property must be continued. If the
designated use of the property is not continued by the participating
municipality or municipalities, the property must revert to this state. The
reversionary interest under this subsection is in addition to, and does not
alter or supersede, any other reversionary interest the state may hold in the
property.

(3) If property owned by an authority was designated by the
authority as a public forest and natural resources area, the participating
municipality or municipalities may elect to waive their right, in full or in
part, to the property. If the participating municipality or municipalities
waive their right, in full or in part, to the property, the property or portion
of the property reverts to this state.

(4) If an authority was in existence before the effective
date of the amendatory act that added this subsection and the authority’s
articles address the disposition of the authority’s property, funds, and assets
on dissolution, the articles control the disposition of the property, funds,
and assets on dissolution.

(5) Nothing in this act alters or supersedes any third-party
rights, including rights of the state or federal government, in or attached to
the property owned by an authority.

Sec.
11. (1) An authority may levy a tax of not more than 1 mill for a period of not
more than 20 years on all of the taxable property within the territory of the
authority for the purposes of acquiring, constructing, operating, maintaining,
and improving a public swimming pool, public recreation center, public
auditorium or conference center, public park, or public forest and natural
resources area. The authority may levy the tax only on the approval of a
majority of the electors in each of the participating municipalities of the
authority voting on the tax on November 6, 2001 or, thereafter, at a statewide
general or primary election. The proposal for a tax must be submitted to a vote
of the electors of the authority by resolution of the board.

(2) A ballot proposal for a tax must state the amount and
duration of the millage and the purposes for which the millage may be used. A
proposal for a tax must not be placed on the ballot unless the proposal is
adopted by a resolution of the board and certified by the board not later than
60 days before the election to the county clerk of each county in which all or
part of the territory of the authority is located for inclusion on the ballot.
The proposal must be certified for inclusion on the ballot at the next eligible
election, as specified by the board’s resolution.

(3) If a majority of the electors in each of the
participating municipalities of the authority voting on the question of a tax
approve the proposal as provided under subsection (1), the tax levy is
authorized. Not more than 2 elections may be held in a calendar year on a
proposal for a tax authorized under this act.

(4) The proceeds of a tax levied under this section must only
be used by the authority for those purposes described in this section and must
not be used by the authority for either of the following:

(a) Except as otherwise provided in subsection (5), any
general fund purposes by any participating municipality.

(b) Any school operating purposes, as that term is defined in
section 20 of the state school aid act of 1979, 1979 PA 94, MCL 388.1620, by
any participating municipality that is a school district.

(5) The proceeds of a tax levied under this section may be
used for general fund purposes by a participating municipality if the proceeds
used are directly related to managing the operation of the business of the
authority pursuant to a contract between the authority and that participating
municipality.

Sec.
21. (1) An authority may borrow money and issue bonds or notes to finance the
acquisition, construction, and improvement of a public swimming pool, a public
recreation center, a public auditorium, a public conference center, a public
park, or a public forest and natural resources area, including the acquisition
of sites and the acquisition and installation of furnishings and equipment for
these purposes.

(2) An authority shall not borrow money or issue bonds or
notes for a sum that, together with the total outstanding bonded indebtedness
of the authority, exceeds 2 mills of the taxable value of the taxable property
within the district as determined under section 27a of the general property tax
act, 1893 PA 206, MCL 211.27a.

(3) Bonds or notes issued by an authority are a debt of the
authority and not of the participating municipalities.

(4) A tax levied to pay a bond or note obligation by a
recreational authority under this act must not exceed 5 years without the
approval of a majority of the electors in each of the participating
municipalities of the authority.

(5) All bonds or notes issued by a recreational authority
under this act are subject to the revised municipal finance act, 2001 PA 34,
MCL 141.2101 to 141.2821.

Enacting section 1. This amendatory act does not
take effect unless all of the following bills of the 103rd Legislature are
enacted into law:

(a) House Bill
No. 4798.

(b) House Bill No.
4695.

This act is ordered to take
immediate effect.

Clerk of the House of
Representatives

Secretary of the Senate

Approved___________________________________________

____________________________________________________

Governor