Sturgis City Zoning Code

The following words, terms and phrases, when used in this article, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning:

Authorized city official means a police officer or other personnel of the city authorized by this Code or any ordinance to issue municipal civil infraction citations or municipal civil infraction violation notices.

Bureau means the city municipal ordinance violations bureau as established by this article.

Municipal civil infraction action means a civil action in which the defendant is alleged to be responsible for a municipal civil infraction.

Municipal civil infraction citation means a written complaint or notice prepared by an authorized city official, directing a person to appear in court regarding the occurrence or existence of a municipal civil infraction violation by the person cited.

Municipal civil infraction violation notice means a written notice prepared by an authorized city official, directing a person to appear at the city municipal ordinance violations bureau and to pay the fine and costs, if any, prescribed for the violation by the schedule of civil fines adopted by the city, as authorized under sections 8396 and 8707(6) of Public Act No. 236 of 1961 (MCL 600.8396, 600.8707(6)).

(Ord. of 7-25-2001(1), § 37.01)

Cross reference— Definitions generally, § 1-2.

State Law reference— Similar provisions, MCL 600.8702.

A municipal civil infraction action may be commenced upon the issuance by an authorized city official of (i) a municipal civil infraction citation directing the alleged violator to appear in court; or (ii) a municipal civil infraction violation notice directing the alleged violator to appear at the city municipal ordinance violations bureau.

(Ord. of 7-25-2001(1), § 37.02)

State Law reference— Similar provisions, MCL 600.8703.

Municipal civil infraction citations shall be issued and served by authorized city officials as follows:

(1)

The time for appearance specified in a citation shall be within a reasonable time after the citation is issued.

(2)

The place for appearance specified in a citation shall be the district court.

(3)

Each citation shall be numbered consecutively and shall be in a form approved by the state court administrator. the original citation shall be filed with the district court. Copies of the citation shall be retained by the city and issued to the alleged violator as provided by section 8705 of Public Act No. 236 of 1961 (MCL 600.8705).

(4)

A citation for a municipal civil infraction signed by an authorized city official shall be treated as made under oath if the violation alleged in the citation occurred in the presence of the official signing the complaint and if the citation contains the following statement immediately above the date and signature of the official: "I declare under the penalties of perjury that the statements above are true to the best of my information, knowledge, and belief."

(5)

An authorized city official who witnesses a person commit a municipal civil infraction shall prepare and subscribe, as soon as possible and as completely as possible, an original and required copies of a citation.

(6)

An authorized city official may issue a citation to a person if:

a.

Based upon investigation, the official has reasonable cause to believe that the person is responsible for a municipal civil infraction; or

b.

Based upon investigation of a complaint by someone who allegedly witnessed the person commit a municipal civil infraction, the official has reasonable cause to believe that the person is responsible for an infraction and if the prosecuting attorney or city attorney approves in writing the issuance of the citation.

(7)

Municipal civil infraction citations shall be served by an authorized city official as follows:

a.

Except as provided by subsection 2-333(7)b, an authorized city official shall personally serve a copy of the citation upon the alleged violator.

b.

If the municipal civil infraction action involves the use or occupancy of land, a building or other structure, a copy of the citation does not need to be personally served upon the alleged violator, but may be served upon an owner or occupant of the land, building or structure by posting the copy on the land or attaching the copy to the building or structure. In addition, a copy of the citation shall be sent by first class mail to the owner of the land, building, or structure at the owner's last known address.

(Ord. of 7-25-2001(1), § 37.03)

State Law reference— Similar provisions, MCL 600.8705.

(a)

A municipal ordinance citation shall contain the name and address of the alleged violator, the municipal infraction alleged, the place where the alleged violator shall appear in court, the telephone number of the court, and the time at or by which the appearance shall be made.

(b)

Further, the municipal ordinance citation shall inform the alleged violator that he or she may do one of the following:

(1)

Admit responsibility for the municipal infraction by mail, in person, or by representation, at or by the time specified for appearance.

(2)

Admit responsibility for the municipal civil infraction "with explanation" by mail by the time specified for appearance or, in person, or by representation.

(3)

Deny responsibility for the municipal civil infraction by doing either of the following:

a.

Appearing in person for an informal hearing before a judge or district court magistrate, without the opportunity of being represented by an attorney, unless a formal hearing before a judge is requested by the city.

b.

Appearing in court for a formal hearing before a judge, with the opportunity of being represented by an attorney.

(c)

The citation shall also inform the alleged violator of all of the following:

(1)

That if the alleged violator desires to admit responsibility "with explanation" in person or by representation, the alleged violator must apply to the court in person, by mail, by telephone, or by representation within the time specified for appearance and obtain a scheduled date and time for an appearance.

(2)

That if the alleged violator desires to deny responsibility, the alleged violator must apply to the court in person, by mail, by telephone, or by representation within the time specified for appearance and obtain a scheduled date and time to appear for a hearing, unless a hearing date is specified on the citation.

(3)

That a hearing shall be an informal hearing unless a formal hearing is requested by the alleged violator or the city.

(4)

That at an informal hearing the alleged violator must appear in person before a judge or district court magistrate, without the opportunity of being represented by an attorney.

(5)

That at a formal hearing the alleged violator must appear in person before a judge with the opportunity of being represented by an attorney.

(d)

The citation shall contain a notice in boldfaced type that the failure of the alleged violator to appear within the time specified in the citation or at the time scheduled for a hearing or appearance is a misdemeanor and will result in entry of a default judgment against the alleged violator on the municipal civil infraction.

(Ord. of 7-25-2001(1), § 37.04)

State Law reference— Similar provisions, MCL 600.8709.

(a)

Bureau established. The city hereby establishes a municipal ordinance violations bureau ("bureau") as authorized under section 8396 of Public Act No. 236 of 1961 (MCL 600.8396) to accept admissions of responsibility for municipal civil infractions in response to municipal civil infraction violation notices issued and served by authorized city officials, and to collect and retain civil fines and costs as prescribed by this Code or any ordinance.

(b)

Location; supervision; employees; rules and regulations. The municipal ordinance violations bureau shall be located at city hall, and shall be under the supervision and control of the city clerk-treasurer. The city clerk-treasurer, subject to the approval of the city commission, shall adopt rules and regulations for the operation of the bureau and appoint any necessary qualified city employees to administer the bureau.

(c)

Disposition of violations. The municipal ordinance violations bureau may dispose only of municipal civil infraction violations for which a fine has been scheduled and for which a municipal civil infraction violation notice (as compared with a citation) has been issued. The fact that a fine has been scheduled for a particular violation shall not entitle any person to dispose of the violation at the bureau. Nothing in this article shall prevent or restrict the city from issuing a municipal civil infraction citation for any violation or from prosecuting any violation in a court of competent jurisdiction. No person shall be required to dispose of a municipal civil infraction violation at the bureau and may have the violation processed before a court of appropriate jurisdiction. The unwillingness of any person to dispose of any violation at the municipal ordinance violations bureau shall not prejudice the person or in any way diminish the person's rights, privileges and protection accorded by law.

(d)

Bureau limited to accepting admissions of responsibility. The scope of the municipal ordinance violations bureau's authority shall be limited to accepting admissions of responsibility for municipal civil infractions and collecting and retaining civil fines and costs as a result of those admissions. The municipal ordinance violations bureau shall not accept payment of a fine from any person who denies having committed the offense or who admits responsibility only with explanation, and in no event shall the bureau determine, or attempt to determine, the truth or falsity of any fact or matter relating to an alleged violation.

(e)

Municipal civil infraction violation notices. Municipal civil infraction violation notices shall be issued and served by authorized city officials under the same circumstances and upon the same persons as provided for citations as provided in subsections 2-333(6) and (7). In addition to any other information required by this Code or other ordinance, the notice of violation shall indicate the time by which the alleged violator must appear at the municipal ordinance violations bureau, the methods by which an appearance may be made, the address and telephone number of the bureau, the hours during which the bureau is open, the amount of the fine scheduled for the alleged violation, and the consequences for failure to appear and pay the required fine within the required time.

(f)

Appearance; payment of fines and costs. An alleged violator receiving a municipal civil infraction violation notice shall appear at the municipal ordinance violations bureau and pay the specified fine and costs at or by the time specified for appearance in the municipal civil infraction violation notice. An appearance may be made by mail, in person, or by representation.

(g)

Procedure where admission of responsibility not made or fine not paid. If an authorized city official issues and serves a municipal ordinance violation notice and if an admission of responsibility is not made and the civil fine and costs, if any, prescribed by the schedule of fines for the violation are not paid at the municipal ordinance violations bureau, a municipal civil infraction citation may be filed with the district court and a copy of the citation may be served by first class mail upon the alleged violator at the alleged violator's last known address. The citation filed with the court does not need to comply in all particulars with the requirements for citations as provided by sections 8705 and 8709 of Public Act No. 236 of 1961 (MCL 600.8705, 600.8709), but shall consist of a sworn complaint containing the allegations stated in the municipal ordinance violation notice and shall fairly inform the alleged violator how to respond to the citation.

(Ord. of 7-25-2001(1), § 37.05)

State Law reference— Municipal ordinance violation notices, MCL 600.8707(6).

(a)

A schedule of civil fines payable to the municipal ordinance violations bureau for admissions of responsibility by persons served with municipal ordinance violation notices shall be compiled from time to time and filed with the court or city agency of competent jurisdiction.

(b)

A copy of the schedule, as amended from time to time, shall be available at the municipal ordinance violations bureau.

(Ord. of 7-25-2001(1), § 37.06)

Subject to section 2-416 et seq., the salaries of all officials and employees of the city shall be as established by the city commission.

(Code 1969, § 32.01)

(a)

The city requires, as a condition for employment by the city, the following criminal history review for all prospective city employees:

(1)

State and federal criminal history check.

(2)

State driving record check.

(3)

Fingerprint check.

(b)

The criminal history review shall be conducted by the city police department upon request by the city manager or his designee.

(c)

The results of the criminal history review shall be provided to the city manager, who may share the information only with the department head and direct supervisor of the prospective city employee. Otherwise, the results of the criminal history review shall be considered confidential and may only be disclosed upon the direction of the city attorney.

(d)

The city manager, department heads or direct supervisors of prospective employees are not prohibited from such further background checks or employment verification as they deem appropriate for employment by the city in specific job positions.

(Code 1969, §§ 36.01, 35.02)

Insurance proceeds for property located within the city shall be subject to and held by the city in accordance with the provisions of Public Act No. 495 of 1980 (MCL 500.2845) and the city commission shall provide the required notice thereof to the insurance commissioner for the state.

(Code 1969, § 110.10)

(a)

Authority. The city has the authority to provide benefit to premises within the city for which reimbursement is authorized. The city lacks an effective way to collect those charges. This section is intended to facilitate the collection of those charges by the city.

(b)

Definitions. Unless the context specifically indicates otherwise, the meaning of the following terms used in this section shall be as follows:

Public improvement means an improvement to premises within the city as defined in section 3(b) of Public Act No. 94 of 1933 (MCL 141.103(b)).

Recycling surcharge means a surcharge for recycling services provided pursuant to any Interlocal Agreement with St. Joseph County, Michigan, authorized pursuant to 1989 PA 138, as amended, being MCL 124.508(a).

Service means the supplying by the city, directly or indirectly, of a benefit to a premise located within the city pursuant to chapter 14, article III of this Code, chapter 34, 46, 62, or 66 of this Code or the Zoning Ordinance or recycling services provided pursuant to any Interlocal Agreement with St. Joseph County, Michigan, authorized pursuant to 1989 PA 138, as amended, being MCL 124.508(a).

(c)

Charges as lien. In addition to any other provision of the ordinances of the city, all charges for service shall constitute a lien upon the respective properties served. If any charge, other than a recycling surcharge, remains delinquent for six months or more, it may be certified to the city assessor by resolution of the city commission and assessed against the property on the next city tax roll, in which event such charge shall be collected and returned in the same manner as other city taxes are collected and returned.

(d)

Exceptions. Notwithstanding the provisions of subsection (c) of this section, in a case where a tenant is responsible for the payment of the charge for a service relating to a public improvement, and the city is so notified in writing, such notice to include a true copy of the lease of the affected premises, if there be one, then the charge for such service shall not become a lien against such premises after the date of the notice and during the period stated in the notice with respect to the obligation of such tenant.

(e)

Recycling surcharge. A recycling surcharge assessed against a residential parcel of property shall be placed on the winter and/or summer ad valorem tax bill for that parcel and shall be collected and returned in the same manner as other city taxes are collected and returned.

(Code 1969, §§ 36.01—36.04; Ord. of 7-9-2008)

(a)

Purpose. It is acknowledged that it is a proper public purpose of the state and its political subdivisions to provide housing for its citizens of low income and to encourage the development of such housing by providing for a service charge in lieu of property taxes in accordance with the state housing development authority act of 1966 (MCL 125.1401, et seq.).

(1)

The city is authorized by this act to establish or change the service charge to be paid in lieu of taxes by any or all classes of housing exempt from taxation under this act at any amount it chooses, not to exceed the taxes that would be paid but for this act. It is further acknowledged that such housing for persons of low income is a public necessity, and as the city will be benefited and improved by such housing, the encouragement of the same by providing certain real estate tax exemption for such housing is a valid public purpose; further, that the continuance of the provisions of this section for tax exemption and the service charge in lieu of taxes during the period contemplated in this section are essential to the determination of economic feasibility of the housing development which is to be constructed and financed in reliance on such tax exemption and service charge.

(2)

The city acknowledges that Deer Creek Sturgis Limited Dividend Housing Association Limited Partnership (the "sponsor") has offered, subject to receipt of a mortgage loan from the state housing development authority, to erect, own and operate a housing development identified as Deer Creek on certain property located in the city to serve persons of low income, and that the sponsor has offered to pay the city on account of this housing development an annual service charge for public services in lieu of taxes.

(b)

Definitions. The following words, terms and phrases, when used in this section, shall have the meanings ascribed to them in this subsection, except where the context clearly indicates a different meaning:

Act or the Act means the State Housing Development Authority Act (MCL 125.1401 et seq.)

Annual shelter rent means the total collections during an agreed annual period from all occupants of a housing development representing rent or occupancy charges, exclusive of charges for gas, electricity, heat, or other utilities furnished to the occupants.

Authority means the state housing development authority.

Commencement of construction means the commencement of new construction of what is commonly referred to as Deer Creek Apartments, located adjacent to Quail Run III and east of Fawn River Apartments on Cato Lane.

Housing development means a development which contains a significant element of housing for persons of low income and such elements of other housing, commercial, recreational, industrial, communal, and educational facilities as the authority determines improve the quality of the development as it relates to housing for persons of low income.

Housing development project means the construction of rental housing, which will be commonly referred to as Deer Creek Apartments, located within the city adjacent to Quail Run III and east of Fawn River Apartments on Cato Lane, consisting of approximately 40 units.

Low income persons or families means low income persons or families as defined in section 15(a)(7) of the act.

Mortgage loan means a federally-aided or authority-aided mortgage or advance from the authority, as defined in the act, to the sponsor for the construction and/or permanent financing of the housing development.

Sponsor means a person or an entity which has applied to the authority for a mortgage loan or for an allocation under the low income housing tax credit program to finance the project. The sponsor under the Deer Creek Apartments PILOT Ordinance is Deer Creek Sturgis Limited Dividend Housing Association Limited Partnership.

Utilities means fuel, water, sanitary sewer service, and/or electrical service which are paid by the housing development.

(c)

Class of housing development. It is determined that the class of housing developments to which the tax exemption shall apply and for which a service charge shall be paid in lieu of such taxes shall be housing developments that are financed or assisted pursuant to the act. It is further determined that the housing development project defined in this section is of this class.

(d)

Establishment of annual service charge in lieu of property taxes.

(1)

Subject to the conditions precedent in this section, the housing development project and the property on which it is situated shall be exempt from all property taxes for not more than 50 years from and after the commencement of construction. The city acknowledges that the sponsor and the authority have established the economic feasibility of the housing development project in reliance upon the enactment and continuing effect of this section and the qualification of the housing development project for the exemption from all property taxes and a payment in lieu of taxes as established in this section, and in consideration of the sponsor's offer, subject to receipt of a mortgage loan to own and operate the housing development project. The city agrees to accept payment of an annual service charge for public services in lieu of all property taxes, provided the sponsor furnishes the city with proof of its annual certification pursuant to the requirements of the act and at the request of the city, and proof that the housing development project units have not increased, decreased or been altered in any form, unless the city has otherwise amended the provisions of this section.

(2)

In addition to the annual certification requirement in paragraph (1) of this subsection, the tax exemption shall commence upon execution of the Consent Judgment and entry by the Court, which will result in resolution of Deer Creek Sturgis Limited Dividend Housing Association, et al. v. City of Sturgis, et al, filed in the United States District Court for the Western District of Michigan, case number 5:03-cv-69; and upon the sponsor providing the city with an affidavit, certified by the authority that the project is eligible for the exemption, in compliance with section 15a of the act.

(3)

The annual service charge shall be equal to four percent of the difference between the annual shelter rents actually collected and utilities.

(e)

Limitation on the payment of the annual service charge. Notwithstanding subsection (d) of this section, the service charge to be paid each year in lieu of taxes for the part of the housing development project which is tax exempt and which is occupied by other than low income persons or families shall be equal to the full amount of the taxes that would otherwise be due and payable on that portion of the housing development project if the project were not tax exempt.

(f)

Payment of service charge. The service charge in lieu of taxes as determined under this section shall be payable in the same manner as general property taxes are payable to the City, except that the annual payment shall be paid on or before June 1 of each year.

(g)

Contractual effect of ordinance. Notwithstanding the provisions of section 15(a)(5) of the act to the contrary, a contract between the city and the sponsor, with the authority as third party beneficiary under the contract, to provide tax exemption and accept payments in lieu of taxes, as previously described, is effectuated by enactment of the ordinance from which this section is derived.

(h)

Duration; commencement of construction.

(1)

The property tax exempt status of the housing development project approved by this section shall remain in effect and shall not terminate so long as the mortgage loan for the housing development project remains outstanding and unpaid, or for such period as the authority or other governmental entity has any interest in the property or the project is subject to income and rent restrictions under section 42 of the Internal Revenue Code, as amended; provided that the construction of the housing development project commences within one year from April 5, 2004, and that the number of units and the purposes for the housing development project remain unchanged, subject to amendment in accordance with the law. If the construction of the housing development project does not commence within one year from April 5, 2004, this section shall automatically expire, terminate and be of no effect. If the sponsor changes the scope or purpose of the housing development project without the consent of the people of the city, by and through its representatives, and in accordance with the requirements of the law, this section shall automatically expire, terminate and be of no effect.

(2)

Except as provided in subsection (h)(1) of this section, the exemption from property taxes shall terminate not later than 50 years from and after the date of the commencement of construction.

(Ord. of 3-10-2004)

(a)

Purpose. It is acknowledged that it is a proper public purpose of the State of Michigan and its political subdivisions to provide housing for its citizens of low income to moderate income and to encourage the development of such housing by providing for a service charge in lieu of property taxes in accordance with the State Housing Development Authority Act of 1966 (1966 PA 346, as amended, MCL Section 125.1401 et. seq.). The city is authorized by this Act to establish or change the service charge to be paid in lieu of taxes by any or all classes of housing exempt from taxation under this Act at any amount it chooses not to exceed the taxes that would be paid but for this Act. It is further acknowledged that such housing for persons and/or families of low income to moderate income is a public necessity, and as the city will be benefited and improved by such housing, the encouragement of the same by providing certain real estate tax exemption for such housing is a valid public purpose; further, that the continuance of the provisions of this section for tax exemption and the service charge in lieu of taxes during the period contemplated in this section are essential to the determination of economic feasibility of housing developments which are constructed and financed in reliance on such tax exemption.

The city acknowledges that FHC Three Village Manor Limited Dividend Housing Association Limited Partnership (the "sponsor") has offered subject to receipt of a mortgage loan from the Michigan State Housing Development Authority or a federally aided mortgage loan from another lender, to rehabilitate, own and operate a housing development identified as Village Manor Townhouses located in the City of Sturgis, more particularly described in Exhibit "A" attached hereto, to serve persons and/or families of low and moderate income, and that the Sponsor has offered to pay the city on account of this housing development an annual service charge for public services in lieu of all taxes.

(b)

Definitions. The following words, terms and phrases, when used in this section, shall have the meanings ascribed to them in this subsection, except where the context clearly indicates a different meaning:

Act means the State Housing Development Authority Act, being Public Act 346 of 1966, of the State of Michigan, as amended.

Authority means the Michigan State Housing Development Authority.

Annual shelter rent means the total collections during an agreed annual period from all units of the housing development representing rent or occupancy charges, exclusive of utilities furnished to the occupants.

City means the City of Sturgis, a Michigan municipal corporation.

Housing development means a development which contains a significant element of housing for persons and/or families of low to moderate income and such elements of other housing, commercial, recreational, industrial, communal, and educational facilities as the authority determines improve the quality of the development as it relates to housing for persons of low income.

Rehabilitation means that the sponsor shall spend a minimum of $5,000,000 for rehabilitating and improving the housing development.

Mortgage loan means a loan to be made by the authority to the sponsor for the construction and/or permanent financing of the housing development.

Persons and/or families of low to moderate income means those persons and families, including the elderly, who are determined to be eligible to move into Village Manor Townhomes.

Sponsor means FHC Three Village Manor Limited Dividend Housing Association Limited Partnership, which has applied or will apply to the authority for Low Income Housing Tax Credits.

Utilities mean water, gas, electricity, heat, sanitary sewer and any other utilities which are paid by the housing development.

(c)

Class of housing developments exempt from taxation. It is determined that the class of housing developments to which the tax exemption shall apply and for which a service charge shall be paid in lieu of such taxes shall be housing for persons and/or families of low to moderate income, which are financed or assisted pursuant to the Act and which are limited as to the number of units allowable by zoning. It is further determined that Village Manor Townhouses is of this class. (Passage of this section shall not be deemed precedent for other similar PILOT ordinances.)

(d)

Establishment of annual service charge. The housing development identified as Village Manor Townhouses and the property on which it is constructed shall be exempt from all property taxes from and after the commencement of rehabilitation. The city, acknowledging that the sponsor and the authority have established the economic feasibility of the housing development in reliance upon the enactment and continuing effect of this section and the qualification of the housing development for exemption from all property taxes and a payment in lieu of taxes as established in this section, and in consideration of the sponsor's offer, subject to receipt of a mortgage loan from the authority or a federally aided mortgage loan from another lender, to rehabilitate, own and operate the housing development, agrees to accept payment of an annual service charge for public services in lieu of all property taxes subject to the requirements of subsections (g) and (h) hereof. The annual service charge shall be equal to eight percent of the annual shelter rent for the first year, and each year thereafter.

(e)

Limitation on the payment of annual service charge. Notwithstanding subsection (d) hereof, the service charge to be paid each year in lieu of taxes for the part of the housing development which is tax exempt and which is occupied by other than low income persons or families shall be equal to the full amount of the taxes which would be paid on that portion of the housing development if the housing development were not tax exempt. The term low to moderate income persons or families as used herein means, with respect to any Housing Development that is tax-exempt, any person or family eligible to move into such development.

(f)

Contractual effect of section. Notwithstanding the provisions of Section 15(a)(5) of the Act to the contrary, a contract between the city and the sponsor with the authority as third party beneficiary under the contract, to provide tax exemption and accept payments in lieu of taxes, as previously described, is effectuated by enactment of this section.

(g)

Verification of annual shelter rent. The Sponsor shall verify annual shelter rent revenues to the city with a statement of profit and loss of the housing development as reported to the authority by an independent certified public accountant or such other form of financial documentation deemed suitable by the city. The statement of profit and loss, or such other form of financial documentation acceptable to the city, together with a statement describing the methodology by with the Sponsor calculated the service charge, shall be submitted to the city treasurer by April 30 each year.

(h)

Duration. This section shall remain in effect until the latest of: (i) the date the mortgage loan no longer remains outstanding and unpaid, (ii) the housing development is no longer subject to income and rent restrictions pursuant to Section 42 of the Internal Revenue Code of 1986, as amended, or (iii) neither the authority nor HUD has any interest in the property; provided, however, that rehabilitation of the housing development commences within 60 days from date of the mortgage loan closing and is completed within one year from the date of said mortgage loan closing.

(i)

Payment of service charge. The service charge in lieu of taxes as determined under the Ordinance shall be payable in the same manner as general property taxes are payable to the except that the annual payment shall be paid on or before June 1 of each year.

(j)

Termination. The tax exemption extended hereunder may be terminated and the property restored to the tax rolls by resolution duly adopted by the city in any of the following events upon notice of default in writing to the Sponsor and the authority by certified mail return receipt requested or by nationally recognized overnight carrier with receipt acknowledged in writing to the address on file with the Department of Labor and Economic Growth (or any successor department) and a failure by the sponsor to cure the default within 30 days following delivery of written notice to the sponsor thereof by the city: (a) failure of the Sponsor or the development to remain in compliance with the terms of this section or the Act; (b) failure of the Sponsor to complete rehabilitation as provided in subsection (h) hereof; or (c) failure of the sponsor to provide such reports and documentation as may be required by subsection (g) hereof. Determinations of the event and continuing existence of default and the sufficiency of actions taken to cure default shall be in the sole judgment of the city.

(k)

Severability. The various sections and provisions of this section shall be deemed to be severable, and should any section or provision of this section be declared by any court of competent jurisdiction to be unconstitutional or invalid the same shall not affect the validity of the section as a whole or any section or provision of this section other than the section or provision so declared to be unconstitutional or invalid.

(l)

Effective date. This section shall become effective 20 days after its passage or as otherwise provided in the Charter. All ordinances or parts of ordinances in conflict with this section are repealed to the extent of such conflict.

Provided, however, in the event the sponsor does not commence rehabilitation on or before December 15, 2015, this section shall be automatically repealed and the payment in lieu of taxes authorization pertaining to the project in effect immediately prior to enactment of this section shall be automatically reinstated without further action of the city.

(Ord. of 12-19-2007; Ord. of 7-24-2013; Ord. of 7-26-2015; Ord. of 8-12-2015)

(a)

Purpose. It is acknowledged that it is a proper public purpose of the State of Michigan and its political subdivisions to provide housing for its citizens of low income to moderate income and to encourage the development of such housing by providing for a service charge in lieu of property taxes in accordance with the State Housing Development Authority Act of 1966 (1966 PA 346, as amended, MCL Section 125.1401 et. seq.). The city is authorized by this Act to establish or change the service charge to be paid in lieu of taxes by any or all classes of housing exempt from taxation under this Act at any amount it chooses, not to exceed the taxes that would be paid but for this Act. It is further acknowledged that such housing for persons and/or families of low income to moderate income is a public necessity, and as the city will be benefited and improved by such housing, the encouragement of the same by providing certain real estate tax exemption for such housing is a valid public purpose; further, that the continuance of the provisions of this section for tax exemption and the service charge in lieu of taxes during the period contemplated in this section are essential to the determination of economic feasibility of housing developments which are constructed and financed in reliance on such tax exemption.

The city acknowledges that Sturgis Housing Limited Dividend Housing Association Limited Partnership (the "sponsor") has offered subject to receipt of an allocation under the LIHTC Program from the Michigan State Housing Development Authority to rehabilitate, own and operate a housing development identified as Gateway Village Apartments located in the City of Sturgis, more particularly described in Exhibit "A" attached [to the ordinance from which this section derives and available for inspection in the office of the city clerk], to serve persons and/or families of low and moderate income, and that the sponsor has offered to pay the city on account of this housing development an annual service charge for public services in lieu of all taxes.

(b)

Definitions. The following words, terms and phrases, when used in this section, shall have the meanings ascribed to them in this subsection, except where the context clearly indicates a different meaning:

Act means the State Housing Development Authority Act, being Public Act 346 of 1966, of the State of Michigan, as amended.

Authority means the Michigan State Housing Development Authority, a public body, corporate and politic of the State of Michigan.

Annual shelter rent means the contract rent (which is the rent that the tenant is obligated to pay under its lease) payable by occupied units during an agreed annual period from the occupants of a housing development representing rent or occupancy charges, exclusive of utilities furnished to the occupants.

City means the City of Sturgis, a Michigan municipal corporation.

Housing development means a development which contains a significant element of housing for persons and/or families of low to moderate income and such elements of other housing, commercial, recreational, industrial, communal, and educational facilities as the authority determines improve the quality of the development as it relates to housing for persons of low income.

LIHTC Program means the Low Income Housing Tax Credit Program administered by the authority under Section 42 of the Internal Revenue Code of 1986, as amended.

Persons and/or families of low to moderate income means those persons and families, including the elderly, who are determined to be eligible to move into Gateway Village Apartments.

Rehabilitation means that the sponsor shall spend a minimum of $4,000,000.00 in construction costs for rehabilitating and improving the housing development.

Sponsor means Sturgis Housing Limited Dividend Housing Association Limited Partnership, which has applied or will apply to the Authority for an allocation under the LIHTC Program to finance a Housing Development.

Utilities mean fuel, water, gas, electricity, heat, sanitary sewer and any other utilities which are paid by the housing development.

(c)

Class of housing developments exempt from taxation. It is determined that the class of housing developments to which the tax exemption shall apply and for which a service charge shall be paid in lieu of such taxes shall be housing for persons and/or families of low to moderate income, which are financed or assisted pursuant to the Act and which are limited as to the number of units allowable by zoning. It is further determined that Gateway Village Apartments is of this class. (Passage of this section shall not be deemed precedent for other similar PILOT ordinances.)

(d)

Establishment of annual service charge. The housing development identified as Gateway Village Apartments and the property on which it is constructed shall be exempt from all property taxes from and after the commencement of construction of the rehabilitation. The city, acknowledging that the sponsor and the authority have established the economic feasibility of the housing development in reliance upon the enactment and continuing effect of this section and the qualification of the housing development for exemption from all property taxes and a payment in lieu of taxes as established in this section, and in consideration of the sponsor's offer, subject to receipt of an allocation under the LIHTC Program from the authority, to rehabilitate, own and operate the housing development, agrees to accept payment of an annual service charge for public services in lieu of all property taxes subject to the requirements of subsections (g) and (h) hereof. The annual service charge shall be equal to five and one-half percent of the Annual Shelter Rent, but not less than $30,000.00 each year.

(e)

Limitation on the payment of annual service charge. Notwithstanding subsection (d) hereof, the service charge to be paid each year in lieu of taxes for the part of the housing development which is tax exempt and which is occupied by other than low income persons or families shall be equal to the full amount of the taxes which would be paid on that portion of the housing development if the housing development were not tax exempt. The term low to moderate income persons or families as used herein means, with respect to any housing development that is tax-exempt, any person or family eligible to move into such development.

(f)

Contractual effect of ordinance. Notwithstanding the provisions of Section 15(a)(5) of the Act to the contrary, a contract between the city and the sponsor with the authority as third party beneficiary under the contract, to provide tax exemption and accept payments in lieu of taxes, as previously described, is effectuated by enactment of this section.

(g)

Verification of annual shelter rent. The sponsor shall verify annual shelter rent revenues to the city with a statement of profit and loss of the housing development as reported to the authority by an independent certified public accountant or such other form of financial documentation deemed suitable by the city. The statement of profit and loss, or such other form of financial documentation acceptable to the city, together with a statement describing the methodology by with the sponsor calculated the service charge, shall be submitted to the city treasurer by April 30 each year.

(h)

Duration. This section shall remain in effect so long as the housing development remains subject to income and rent restrictions pursuant to Section 42 of the Internal Revenue Code of 1986, as amended; and provided that construction of the rehabilitation of the housing development commences within one year from the effective date of this section and is completed within one year from commencement of construction.

(i)

Payment of service charge. The service charge in lieu of taxes as determined under the Ordinance shall be payable in the same manner as general property taxes are payable to the except that the annual payment shall be paid on or before June 1 of each year. The entire tax collection procedure including the lien status for non-payment provided by the General Property Tax Act of the State of Michigan, including applicable provisions of the Charter and Ordinances for the City of Sturgis, shall be effective with respect to such payment, including, but not by way of limitation, the provisions providing for interest and penalties on late payments, return of delinquent taxes, and the sale of the lands for delinquent taxes.

(j)

Severability. The various sections and provisions of this section shall be deemed to be severable, and should any section or provision of this section be declared by any court of competent jurisdiction to be unconstitutional or invalid the same shall not affect the validity of the section as a whole or any section or provision of this section other than the section or provision so declared to be unconstitutional or invalid.

(k)

Effective date. This section shall become effective 20 days after its passage or as otherwise provided in the Charter. All ordinances or parts of ordinances in conflict with this section are repealed to the extent of such conflict. Provided, however, in the event the sponsor does not commence rehabilitation on or before March 31, 2016, this section shall be automatically repealed.

(Ord. of 3-11-2015)

(1)

Definitions. Whenever used in this section, except when otherwise indicated by the context, the following terms shall have the following meanings:

(a)

"Act 94" means Act 94, Public Acts of Michigan, 1933, as amended.

(b)

"Authority" means the Michigan Finance Authority.

(c)

"Authorized Officers" means the mayor, city clerk/treasurer, city manager and the finance director of the issuer.

(d)

"Bonds" means the Series 2013B Bonds, together with the Outstanding Bonds and any additional bonds hereafter issued of equal standing with the Series 2013B Bonds.

(e)

"Engineers" means Fleis & Vandenbrink Engineers, the issuer's consulting engineers.

(f)

"Issuer" means the City of Sturgis, County of St. Joseph, State of Michigan.

(g)

"MDEQ" means the Michigan Department of Environmental Quality, or its successor agency.

(h)

"Outstanding bonds" means the Series 1996 Bonds, Series 2007 Bonds, Series 2008 Bonds and the Series 2013A Bonds.

(i)

"Prior Ordinance" means the Bond Authorizing Resolutions adopted on May 22, 1996, August 22, 2007, and August 8, 2008, and Article IV, Finance, section 2-305 of the Code of Ordinances of the issuer authorizing the issuance of the outstanding bonds.

(j)

"Project" means the acquisition, construction, furnishing and equipping of additions, extensions and improvements to the city's sanitary sewer system, together with all necessary interests in land, rights-of-way and all appurtenances and attachments therefor, as described in the plans prepared by the engineers and approved herein.

(k)

"Purchase contract" means the purchase contract to be entered into between the authority and the issuer relating to the purchase by the authority of the Series 2013B Bonds.

(l)

"Revenues" and "net revenues" means the revenues and net revenues of the system and shall be construed as defined in Section 3 of Act 94, including with respect to "revenues", the earnings derived from the investment of moneys in the various funds and accounts established by the prior ordinance and this section.

(m)

"Series 1996 Bonds" means the issuer's Sanitary Sewer System Improvement Revenue Bond, Series 1996 (Limited Tax General Obligation).

(n)

"Series 2007 Bonds" means the issuer's Sanitary Sewer System Improvement Revenue Bond, Series 2007 (Limited Tax General Obligation).

(o)

"Series 2008 Bonds" means the issuer's Sanitary Sewer System Improvement Revenue Bond, Series 2008 (Limited Tax General Obligation).

(p)

"Series 2013A Bonds" means the issuer's Sanitary Sewer System Improvement Revenue Bond, Series 2013A (Limited Tax General Obligation).

(q)

"Series 2013B Bonds" means the issuer's Sanitary Sewer System Improvement Revenue Bond, Series 2013B (Limited Tax General Obligation), in the principal amount of not to exceed $1,170,000.00 issued pursuant to this section.

(r)

"Sufficient government obligations" means direct obligations of the United States of America or obligations the principal and interest on which is fully guaranteed by the United States of America, not redeemable at the option of the issuer, the principal and interest payments upon which without reinvestment of the interest, come due at such times and in such amounts as to be fully sufficient to pay the interest as it comes due on the Bonds and the principal and redemption premium, if any, on the Bonds as it comes due whether on the stated maturity date or upon earlier redemption. Securities representing such obligations shall be placed in trust with a bank or trust company, and if any of the Bonds are to be called for redemption prior to maturity, irrevocable instructions to call the Bonds for redemption shall be given to the paying agent.

(s)

"Supplemental agreement" means the supplemental agreement among the issuer, the authority and MDEQ relating to the Series 2013B Bonds.

(t)

"System" means the entire sanitary sewer system of the issuer, including the project and all additions, extensions and improvements hereafter acquired.

(2)

Necessity; approval of plans and specifications. It is hereby determined to be a necessary public purpose of the issuer to acquire and construct the Project in accordance with the plans and specifications prepared by the Engineers, which plans and specifications are hereby approved. The Project qualifies for the State Revolving Fund financing program being administered by the MDEQ and the authority, whereby bonds of the issuer are sold to the authority and bear interest at a fixed rate of two and one-half percent per annum.

(3)

Costs; useful life. The cost of the project is estimated to be an amount not to exceed $4,975,000.00, including the payment of incidental expenses as specified in subsection (4) of this section, which estimate of cost is hereby approved and confirmed, and the period of usefulness of the project is estimated to be not less than 25 years.

(4)

Payment of cost; bonds authorized. To pay part of the cost of acquiring and constructing the project, legal, engineering, financial and other expenses incident thereto and incident to the issuance and sale of the Series 2013B Bonds, the issuer shall borrow the sum of not to exceed $1,170,000.00, or such lesser amount as shall have been advanced to the issuer pursuant to the purchase contract and the supplemental agreement, and issue the Series 2013B Bonds pursuant to the provisions of Act 94. The remaining cost of the project, if any, shall be defrayed from issuer funds on hand and legally available for such use.

Except as amended by or expressly provided to the contrary in this section, all of the provisions of the prior ordinance shall apply to the Series 2013B Bonds issued pursuant to this section, the same as though each of said provisions were repeated in this section in detail; the purpose of this section being to authorize the issuance of additional revenue bonds of equal standing and priority of lien as to the net revenues with the outstanding bonds to finance the cost of acquiring and constructing additions, extensions and improvements to the System; such purpose being authorized by the provisions of the prior ordinance, upon the conditions therein stated, which conditions have been fully met.

(5)

Issuance of Series 2013B Bonds; details. The Series 2013B Bonds of the issuer, to be designated SANITARY SEWER SYSTEM IMPROVEMENT REVENUE BOND, SERIES 2013B (LIMITED TAX GENERAL OBLIGATION), are authorized to be issued in the aggregate principal sum of not to exceed $1,170,000.00 as finally determined by order of the MDEQ for the purpose of paying part of the cost of the project, including the costs incidental to the issuance, sale and delivery of the Series 2013B Bonds. The Series 2013B Bonds shall be payable out of the net revenues, as set forth more fully in subsection (8) hereof. The Series 2013B Bonds shall be in the form of a single fully-registered, nonconvertible bond of the denomination of the full principal amount thereof, dated as of the date of delivery, payable in principal installments as finally determined by the order of the MDEQ at the time of sale of the Series 2013B Bonds and approved by the authority and an authorized officer. Principal installments of the Series 2013B Bonds shall be payable on April 1 of the years 2015 through 2034, inclusive, or such other payment dates as hereinafter provided. Interest on the Series 2013B Bonds shall be payable on April 1 and October 1 of each year, commencing April 1, 2014, or on such other interest payment dates as hereinafter provided. Final determination of the principal amount of and interest on the Series 2013B Bonds and the payment dates and amounts of principal installments of the Series 2013B Bonds shall be evidenced by execution of the purchase contract and each of the authorized officers is authorized and directed to execute and deliver the purchase contract when it is in final form and to make the determinations set forth above; provided, however, that the first principal installment shall be due no earlier than April 1, 2014, and the final principal installment shall be due no later than October 1, 2034, and that the total principal amount shall not exceed $1,170,000.00.

The Series 2013B Bonds shall bear interest at a rate of two and one-half percent per annum on the par value thereof or such other rate as evidenced by execution of the purchase contract, but in any event not to exceed the rate permitted by law, and any authorized officers as shall be appropriate shall deliver the Series 2013B Bonds in accordance with the delivery instructions of the authority.

The principal amount of the Series 2013B Bonds is expected to be drawn down by the issuer periodically, and interest on principal amount shall accrue from the date such principal amount is drawn down by the issuer.

The Series 2013B Bonds shall not be convertible or exchangeable into more than one fully-registered bond. Principal of and interest on the Series 2013B Bonds shall be payable as provided in the Series 2013B Bond form in this section.

The Series 2013B Bonds shall be subject to optional redemption by the issuer with the prior written approval of the authority and on such terms as may be required by the authority.

The city clerk/treasurer shall record on the registration books payment by the issuer of each installment of principal or interest or both when made and the cancelled checks or other records evidencing such payments shall be returned to and retained by the city clerk/treasurer.

Upon payment by the issuer of all outstanding principal of and interest on the Series 2013B Bonds, the authority shall deliver the Series 2013B Bonds to the issuer for cancellation.

(6)

Execution of Series 2013B Bonds. The Series 2013B Bonds shall be signed by the manual or facsimile signature of the mayor and countersigned by the manual or facsimile signature of the city clerk/treasurer and shall have the corporate seal of the Issuer or a facsimile thereof impressed thereon. The Series 2013B Bonds bearing the manual signatures of the mayor and the city clerk/treasurer sold to the authority shall require no further authentication.

(7)

Registration and transfer. Any bond may be transferred upon the books required to be kept pursuant to this section by the person in whose name it is registered, in person or by the registered owner's duly authorized attorney, upon surrender of the bond for cancellation, accompanied by delivery of a duly executed written instrument of transfer in a form approved by the transfer agent. Whenever any bond or Bonds shall be surrendered for transfer, the issuer shall execute and the transfer agent shall authenticate and deliver a new bond or bonds, for like aggregate principal amount. The transfer agent shall require payment by the bondholder requesting the transfer of any tax or other governmental charge required to be paid with respect to the transfer. The issuer shall not be required (i) to issue, register the transfer of or exchange any bond during a period beginning at the opening of business 15 days before the day of the giving of a notice of redemption of bonds selected for redemption as described in the form of Series 2013B Bonds contained in subsection (13) of this section and ending at the close of business on the day of that giving of notice, or (ii) to register the transfer of or exchange any Bond so selected for redemption in whole or in part, except the unredeemed portion of bonds being redeemed in part. The issuer shall give the transfer agent notice of call for redemption at least 20 days prior to the date notice of redemption is to be given.

The transfer agent shall keep or cause to be kept at its principal office sufficient books for the registration and transfer of the bonds, which shall at all times be open to inspection by the issuer; and upon presentation for such purpose the transfer agent shall under such reasonable regulations as it may prescribe transfer or cause to be transferred on said books bonds as hereinbefore provided.

If any bond shall become mutilated, the issuer, at the expense of the holder of the bond, shall execute, and the transfer agent shall authenticate and deliver, a new bond of like tenor in exchange and substitution for the mutilated bond, upon surrender to the transfer agent of the mutilated bond. If any bond issued under this section shall be lost, destroyed or stolen, evidence of the loss, destruction or theft may be submitted to the transfer agent and, if this evidence is satisfactory to both and indemnity satisfactory to the transfer agent shall be given, and if all requirements of any applicable law including Act 354, Public Acts of Michigan, 1972, as amended ("Act 354"), being sections 129.131 to 129.135, inclusive, of the Michigan Compiled Laws have been met, the issuer, at the expense of the owner, shall execute, and the transfer agent shall thereupon authenticate and deliver, a new bond of like tenor and bearing the statement required by Act 354, or any applicable law hereafter enacted, in lieu of and in substitution for the bond so lost, destroyed or stolen. If any such bond shall have matured or shall be about to mature, instead of issuing a substitute bond the transfer agent may pay the same without surrender thereof.

(8)

Payment of Series 2013B Bonds; security; priority of lien. Principal of and interest on the Series 2013B Bonds shall be payable primarily from the net revenues. There is hereby recognized the statutory lien upon the whole of the net revenues created by this section which shall be a lien that is equal in standing with the lien of the outstanding bonds created by the prior ordinance, to continue until payment in full of the principal of and interest on all bonds payable from the net revenues, or until sufficient cash or sufficient government obligations have been deposited in trust for payment in full of all bonds of a series then outstanding, principal and interest on such bonds to maturity, or, if called for redemption, to the date fixed for redemption together with the amount of the redemption premium, if any. Upon deposit of cash or sufficient government obligations, as provided in the previous sentence, the statutory lien shall be terminated with respect to that series of bonds, the holders of that series shall have no further rights under the prior ordinance or this section except for payment from the deposited funds, and the bonds of that series shall no longer be considered to be outstanding under the prior ordinance or this section.

In addition, the Series 2013B Bonds being sold to the authority, the issuer hereby pledges its limited tax full faith and credit for the payment of the principal of and interest on the Series 2013B Bonds. Should the net revenues of the system at any time be insufficient to pay principal and interest on the Series 2013B Bonds, as the same become due, then the issuer shall advance from any funds available therefor, or, if necessary, levy taxes upon all taxable property in the issuer, subject to applicable constitutional, statutory and charter limitations, such sums as may be necessary to pay said principal and interest. The issuer shall be reimbursed for any such advance from the net revenues of the system subsequently received which are not otherwise pledged or encumbered by this section.

(9)

Management; fiscal year. The operation, repair and management of the system and the acquiring and constructing of the project shall continue to be under the supervision and control of the issuer. The issuer may employ such person or persons in such capacity or capacities as it deems advisable to carry on the efficient management and operation of the system. The issuer may make such rules and regulations as it deems advisable and necessary to assure the efficient management and operation of the system. The system shall be operated on the basis of an operating year which shall coincide with the issuer's fiscal year.

(10)

Rates and charges; no free service. The rates and charges for service furnished by the system and the methods of collection and enforcement of the collection of the rates shall be those in effect on the date of adoption of this section. No free service or use of the system, or service or use of the system at less than cost, shall be furnished by the system to any person, firm, or corporation, public or private, or to any public agency or instrumentality, including the issuer.

(11)

Funds and accounts; flow of funds; bond and interest redemption fund. The funds and accounts established by the prior ordinance are hereby continued, the flow of funds established by the prior ordinance is hereby continued, and the applicable sections of the prior ordinance relating to funds and accounts and flow of funds are incorporated herein by reference as if fully set forth.

(12)

Bond proceeds. The proceeds of the sale of the Series 2013B Bonds as received by the issuer shall be deposited in a separate account in a bank or banks qualified to act as depository of the proceeds of sale under the provisions of Section 15 of Act 94 designated Sanitary Sewer System Revenue Bonds Construction Fund (the "construction fund"). Moneys in the construction fund shall be applied solely in payment of the cost of the Project and any engineering, legal and other expenses incident thereto and to the financing thereof.

(13)

Bond form. The Series 2013B Bonds shall be in substantially the following form with such changes or completion as necessary or appropriate to give effect to the intent of this section, and further subject to such modifications which may be required by the Michigan Attorney General and the authority and approved by bond counsel:

UNITED STATES OF AMERICA
STATE OF MICHIGAN
COUNTY OF ST. JOSEPH
CITY OF STURGIS
SANITARY SEWER SYSTEM
IMPROVEMENT REVENUE BOND, SERIES 2013B
(LIMITED TAX GENERAL OBLIGATION)

REGISTERED OWNER: Michigan Finance Authority

PRINCIPAL AMOUNT: $1,170,000.00

DATE OF ORIGINAL ISSUE: December 12, 2013

The City of Sturgis, County of St. Joseph, State of Michigan (the "city"), acknowledges itself to owe and for value received hereby promises to pay, primarily out of the hereinafter described net revenues of the city's sanitary sewer system (hereinafter defined), to the Michigan Finance Authority (the "authority"), or registered assigns, the principal amount shown above, or such portion thereof as shall have been advanced to the city pursuant to a purchase contract between the city and the authority and a supplemental agreement by and among the city, the authority and the State of Michigan acting through the department of environmental quality, in lawful money of the United States of America, unless prepaid or reduced prior thereto as hereinafter provided.

During the time the principal amount is being drawn down by the city under this bond, the authority will periodically provide to the city a statement showing the amount of principal that has been advanced and the date of each advance, which statement shall constitute prima facie evidence of the reported information, provided that no failure on the part of the authority to provide such a statement or to reflect a disbursement or the correct amount of a disbursement shall relieve the city of its obligation to repay the outstanding principal amount actually advanced (subject to any principal forgiveness as provided in Schedule A), all accrued interest thereon, and any other amount payable with respect thereto in accordance with the terms of this bond.

The principal amount shall be payable on the dates and in the annual principal installment amounts set forth on the schedule attached hereto and made a part hereof, as such Schedule may be adjusted if less than $1,170,000.00 is disbursed to the city or if a portion of the principal amount is prepaid as provided below, with interest on said principal installments from the date each said installment is delivered to the holder hereof until paid at the rate of two and one-half percent per annum. Interest is first payable on April 1, 2014, and semiannually thereafter on the first day of April and October of each year, and principal is payable on the first day of April commencing April 1, 2015, and annually thereafter, as set forth in the purchase contract.

The bond may be subject to redemption prior to maturity by the city only with the prior written consent of the authority and on such terms as may be required by the authority.

Notwithstanding any other provision of this bond, so long as the authority is the owner of this bond, (a) this bond is payable as to principal, premium, if any, and interest at The Bank of New York Mellon Trust Company, N.A. or at such other place as shall be designated in writing to the city by the authority (the "authority's depository"); (b) the city agrees that it will deposit with the authority's depository payments of the principal of, premium, if any, and interest on this Bond in immediately available funds by 12:00 noon at least five business days prior to the date on which any such payment is due whether by maturity, redemption or otherwise; in the event that the authority's depository has not received the city's deposit by 12:00 noon on the scheduled day, the city shall immediately pay to the authority as invoiced by the authority an amount to recover the authority's administrative costs and lost investment earnings attributable to that late payment; and (c) written notice of any redemption of this Bond shall be given by the city and received by the authority's depository at least 40 days prior to the date on which such redemption is to be made.

Additional Interest

In the event of a default in the payment of principal or interest hereon when due, whether at maturity, by redemption or otherwise, the amount of such default shall bear interest (the "additional interest") at a rate equal to the rate of interest which is two and one-half percent above the authority's cost of providing funds (as determined by the authority) to make payment on the bonds of the authority issued to provide funds to purchase this bond but in no event in excess of the maximum rate of interest permitted by law. The additional interest shall continue to accrue until the authority has been fully reimbursed for all costs incurred by the authority (as determined by the authority) as a consequence of the city's default. Such additional interest shall be payable on the interest payment date following demand of the authority. In the event that (for reasons other than the default in the payment of any municipal obligation purchased by the authority) the investment of amounts in the reserve account established by the authority for the bonds of the authority issued to provide funds to purchase this bond fails to provide sufficient available funds (together with any other funds which may be made available for such purpose) to pay the interest on outstanding bonds of the authority issued to fund such account, the city shall and hereby agrees to pay on demand only the city's pro rata share (as determined by the authority) of such deficiency as additional interest on this bond.

For prompt payment of principal and interest on this bond, the city has irrevocably pledged the revenues of the sanitary sewer system of the city, including all appurtenances, extensions and improvements thereto (the "sanitary sewer system"), after provision has been made for reasonable and necessary expenses of operation, maintenance and administration (the "net revenues"), and a statutory lien thereon is hereby recognized and created which is of equal standing and priority of lien as to the prior lien of the city's Sanitary Sewer System Improvement Revenue Bond, Series 1996, city's Sanitary Sewer System Improvement Revenue Bond, Series 2007, the city's Sanitary Sewer System Improvement Revenue Bond, Series 2008 and the city's Sanitary Sewer System Improvement Revenue Bond, Series 2013A (collectively, the "outstanding bonds").

This bond is a single, fully-registered, non-convertible bond in the principal sum indicated above issued pursuant to article IV, Finance, section 2-306, of the Code of Ordinances duly adopted by the city commission of the city (the "ordinance") and bond authorizing resolutions adopted on May 22, 1996, August 22, 2007 and August 6, 2008, respectively, and article IV, Finance, section 2-305, of the Code of Ordinances authorizing issuance of the outstanding bonds (the "prior ordinance"), and under and in full compliance with the Constitution and statutes of the State of Michigan, including specifically Act 94, Public Acts of Michigan, 1933, as amended, for the purpose of paying part of the cost of acquiring and constructing additions, extensions and improvements to the sanitary sewer system of the city.

For a complete statement of the revenues from which and the conditions under which this bond is payable, a statement of the conditions under which additional bonds of superior and equal standing may hereafter be issued and the general covenants and provisions pursuant to which this bond is issued, reference is made to the ordinance and the prior ordinance.

This bond is primarily a self-liquidating bond, payable, both as to principal and interest, solely and only from the net revenues of the sanitary sewer system. The principal of and interest on this bond are secured by the statutory lien hereinbefore mentioned. As additional security, the city has pledged its limited tax full faith and credit for payment of the principal of and interest on this bond, which includes the city's obligation to levy taxes, if necessary, within applicable constitutional, statutory and charter tax rate limitations.

The city has covenanted and agreed, and does hereby covenant and agree, to fix and maintain at all times while any bonds payable from the net revenues of the sanitary sewer system shall be outstanding, such rates for service furnished by the sanitary sewer system as shall be sufficient to provide for payment of the interest upon and the principal of this bond and any bonds of equal standing with this bond, the outstanding bonds and any additional bonds of equal standing with the outstanding bonds, as and when the same shall become due and payable, and to maintain a bond redemption fund therefor, to provide for the payment of expenses of administration and operation and such expenses for maintenance of the sanitary sewer system as are necessary to preserve the same in good repair and working order, and to provide for such other expenditures and funds for the sanitary sewer system as are required by the ordinance and the prior ordinance.

This bond is transferable only upon the books of the city by the registered owner in person or the registered owner's attorney duly authorized in writing, upon the surrender of this bond together with a written instrument of transfer satisfactory to the transfer agent, duly executed by the registered owner or the registered owner's attorney duly authorized in writing, and thereupon a new bond or bonds in the same aggregate principal amount and of the same maturity shall be issued to the transferee in exchange therefor as provided in the Ordinance and the prior ordinance, and upon payment of the charges, if any, therein prescribed.

It is hereby certified and recited that all acts, conditions and things required by law to be done precedent to and in the issuance of this bond have been done and performed in regular and due time and form as required by law.

IN WITNESS WHEREOF, the City, by its City Commission has caused this bond to be executed with the manual signatures of its Mayor and its City Clerk/Treasurer and the corporate seal of the City to be impressed hereon, all as of the Date of Original Issue.

CITY OF STURGIS
County of St. Joseph
State of Michigan

By___________
Its Mayor

(Seal)

Countersigned:

By___________
Its City Clerk/Treasurer

DEQ Project No.: 5541-02
DEQ Approved Amount: $1,170,000
Loan Amount Forgiven: ( )*
Loan Amount to be Repaid:

SCHEDULE A

Based on the schedule provided below unless revised as provided in this paragraph, repayment of the principal of the bond shall be made until the full amount advanced to the City is repaid. In the event the Order of Approval issued by the Department of Environmental Quality (the "Order"), approves a principal amount of assistance less than the amount of the bond delivered to the Authority, the Authority shall only disburse principal up to the amount stated in the Order. In the event (1) that the payment schedule approved by the City and described below provides for payment of a total principal amount greater than the amount of assistance approved by the Order, (2) that less than the principal amount of assistance approved by the Order is disbursed to the City by the Authority or (3) that any portion of the principal amount of assistance approved by the Order and disbursed to the City is forgiven pursuant to the Order, the Authority shall prepare a new payment schedule which shall be effective upon receipt by the City.

Interest on the bond shall accrue on that portion of principal disbursed by the authority to the city pursuant to the order which has not been forgiven pursuant to the order from the date such portion is disbursed, until paid, at the rate of two and one-half percent per annum, payable April 1, 2014, and semi-annually thereafter.

The city agrees that it will deposit with The Bank of New York Mellon Trust Company, N.A., or at such other place as shall be designated in writing to the city by the authority (the "authority's depository") payments of the principal of, premium, if any, and interest on this bond in immediately available funds by 12:00 noon at least five business days prior to the date on which any such payment is due whether by maturity, redemption or otherwise. In the event that the authority's depository has not received the city's deposit by 12:00 noon on the scheduled day, the city shall immediately pay to the authority as invoiced by the authority an amount to recover the authority's administrative costs and lost investment earnings attributable to that late payment.

(14)

Bondholders' rights; receiver. The holder or holders of the bonds representing in the aggregate not less than 20 percent of the entire principal amount thereof then outstanding, may, by suit, action, mandamus or other proceedings, protect and enforce the statutory lien upon the net revenues of the system, and may, by suit, action, mandamus or other proceedings, enforce and compel performance of all duties of the officers of the issuer, including the fixing of sufficient rates, the collection of revenues, the proper segregation of the revenues of the system and the proper application thereof. The statutory lien upon the net revenues, however, shall not be construed as to compel the sale of the system or any part thereof.

If there is a default in the payment of the principal of or interest upon the Series 2013B Bonds, any court having jurisdiction in any proper action may appoint a receiver to administer and operate the System on behalf of the Issuer and under the direction of the court, and by and with the approval of the court to perform all of the duties of the officers of the Issuer more particularly set forth herein and in Act 94.

The holder or holders of the Series 2013B Bonds shall have all other rights and remedies given by Act 94 and law, for the payment and enforcement of the Series 2013B Bonds and the security therefor.

(15)

Negotiated sale; application to MDEQ and authority; execution of documents. The issuer determines that it is in the best interest of the Issuer to negotiate the sale of the Series 2013B Bonds to the authority because the State Revolving Fund financing program provides significant interest savings to the Issuer compared to competitive sale in the municipal bond market. The authorized officers are hereby authorized to make application to the authority and to the MDEQ for placement of the Series 2013B Bonds with the authority. The actions taken by the authorized officers with respect to the Series 2013B Bonds prior to the adoption of this section are ratified and confirmed. The authorized officers are authorized to execute and deliver the purchase contract, the supplemental agreement and the issuer's certificate. Any authorized officer is further authorized to execute and deliver such contracts, documents and certificates as are necessary or advisable to qualify the Series 2013B Bonds for the state revolving fund. Prior to the delivery of the Series 2013B Bonds to the authority, any authorized officer is hereby authorized to make such changes to the form of the Series 2013B Bonds contained in Section 13 of this section as may be necessary to conform to the requirements of Act 227, Public Acts of Michigan 1985, as amended ("Act 227"), including, but not limited to changes in the principal maturity and interest payment dates and references to additional security required by Act 227.

(16)

Covenant regarding tax exempt status of the bonds. The issuer shall, to the extent permitted by law, take all actions within its control necessary to maintain the exemption of the interest on the Series 2013B Bonds from general federal income taxation (as opposed to any alternative minimum or other indirect taxation) under the Internal Revenue Code of 1986, as amended (the "Code"), including, but not limited to, actions relating to any required rebate of arbitrage earnings and the expenditure and investment of Series 2013B Bonds proceeds and moneys deemed to be bond proceeds.

(17)

Approval of bond counsel. The representation of the Issuer by Miller, Canfield, Paddock and Stone, P.L.C. ("Miller Canfield"), as bond counsel is hereby approved, notwithstanding the representation by Miller Canfield of the authority in connection with the State Revolving Fund program which may include advising the authority with respect to this borrowing.

(18)

Approval of bond details. The authorized officers are each hereby authorized to adjust the final bond details set forth herein to the extent necessary or convenient to complete the transaction authorized herein, and in pursuance of the foregoing is authorized to exercise the authority and make the determinations authorized pursuant to Section 7a(1)(c) of Act 94, including but not limited to determinations regarding interest rates, prices, discounts, maturities, principal amounts, denominations, dates of issuance, interest payment dates, redemption rights, the place of delivery and payment, and other matters, provided that the principal amount of Series 2013B Bonds issued shall not exceed the principal amount authorized in this section, the interest rate per annum on the Series 2013B Bonds shall not exceed two and one-half percent per annum, and the Series 2013B Bonds shall mature in not more than 20 annual installments.

(19)

Savings clause. All ordinances, resolutions or orders, or part thereof, in conflict with the provisions of this section are, to the extent of such conflict, repealed.

(20)

Severability; paragraph headings; and conflict. If any section, paragraph, clause or provision of this section shall be held invalid, the invalidity of such section, paragraph, clause or provision shall not affect any of the other provisions of this section. The paragraph headings in this section are furnished for convenience of reference only and shall not be considered to be part of this section.

(21)

Publication and recordation. This section shall be published in full in the Sturgis Journal, a newspaper of general circulation in the Issuer qualified under State law to publish legal notices, promptly after its adoption, and shall be recorded in the ordinance book of the issuer and such record authenticated by the signatures of the mayor and the city clerk/treasurer.

(22)

Effective date. This section shall be effective upon its adoption and publication.

(Ord. of 10-23-2013)

(a)

Purpose. It is acknowledged that it is a proper public purpose of the State of Michigan and its political subdivisions to provide housing for its low income persons and families and to encourage the development of such housing by providing for a service charge in lieu of property taxes in accordance with the Act. The City of Sturgis is authorized by this Act to establish or change the service charge to be paid in lieu of taxes by any or all classes of housing exempt from taxation under this Act at any amount it chooses, not to exceed the taxes that would be paid but for this Act. It is further acknowledged that such housing for low income persons and families is a public necessity, and as the City of Sturgis will be benefited and improved by such housing, the encouragement of the same by providing real estate tax exemption for such housing is a valid public purpose. It is further acknowledged that the continuance of the provisions of this section for tax exemption and the service charge in lieu of all ad valorem taxes during the period contemplated in this section are essential to the determination of economic feasibility of the housing development that is constructed or rehabilitated with financing extended in reliance on such tax exemption.

The City of Sturgis acknowledges that the sponsor (as defined below) has offered, subject to receipt of an allocation under the LIHTC Program by the Michigan State Housing Development Authority, to construct, own and operate a housing development identified as St. Joseph Street Lofts on certain property located at 303 St. Joseph Street, parcel identification number 052-040-101-00 in the City of Sturgis to serve low income persons and families, and that the sponsor has offered to pay the city on account of this housing development an annual service charge for public services in lieu of all ad valorem property taxes.

(b)

Definitions. The following words, terms and phrases, when used in this section, shall have the meanings ascribed to them in this subsection, except where the context clearly indicates a different meaning:

Act means the State Housing Development Authority Act, being Public Act 346 of 1966, of the State of Michigan, as amended.

Annual shelter rent means the total collections during an agreed annual period from or paid on behalf of all occupants of the housing development representing rent or occupancy charges, exclusive of utilities.

Authority means the Michigan State Housing Development Authority.

City means the City of Sturgis, a Michigan municipal corporation.

Housing development means the St. Joseph Street Lofts; a development that contains a significant element of housing for individuals and/or families of low to moderate income and such elements of other housing, commercial, recreational, industrial, communal and educational facilities as the authority has determined improves the quality of the development as it relates to housing for persons of low income.

LIHTC program means the low income housing tax credit program administered by the authority under Section 42 of the Internal Revenue Code of 1986, as amended.

Low income persons and families means persons and families eligible to move into the housing development constructed and maintained by the sponsor.

Mortgage loan means a loan that is federally-aided (as defined in Section 11 of the Act) or a loan or grant made or to be made by the authority to the sponsor for the construction, rehabilitation, acquisition and/or permanent financing of a housing development, and secured by a mortgage on the housing development.

PILOT means "payment in lieu of tax" or a service charge in lieu of property taxes in accordance with the Act.

Sponsor means St. Joseph Street Lofts Limited Dividend Housing Authority L.P., a Michigan limited partnership, which has or intends to apply to the authority for an allocation of low income housing tax credits to finance a housing development, and any entity that receives or assumes a mortgage loan.

Utilities means charges for gas, electric, water, sanitary sewer and other utilities furnished to the occupants that are paid by the housing project.

(c)

Class of housing projects. It is determined that the class of housing developments to which the tax exemption shall apply and for which a service charge shall be paid in lieu of such taxes shall be housing developments for low income persons and families that are financed with a mortgage loan. It is further determined that St. Joseph Street Lofts is of this class. Passage of this section shall not be deemed precedent for other similar PILOT ordinances.

(d)

Establishment of annual service charge. The housing development identified as St. Joseph Street Lofts and the property on which it will be located shall be exempt from all ad valorem property taxes from and after the commencement of construction. The City of Sturgis acknowledges that the sponsor and the authority have established the economic feasibility of the housing development in reliance upon the enactment and continuing effect of this section, and the qualification of the housing development for exemption from all ad valorem property taxes and a payment in lieu of taxes as established in this section. Therefore, in consideration of the sponsor's offer to construct and operate the housing development the city agrees to accept payment of an annual service charge for public services in lieu of all ad valorem property taxes subject to the requirements of subsections (g) and (h) hereto. Subject to receipt of a mortgage loan for the housing development, the annual service charge shall be equal to nine percent of the annual shelter rents actually collected by the housing project but not less than $18,000.00 during each operating year.

(e)

Limitation on the payment of annual service charge. Notwithstanding subsection (d), the service charge to be paid each year in lieu of taxes for the part of the housing development that is tax exempt but which is occupied by other than low income persons or families shall be equal to the full amount of the taxes which would be paid on that portion of the housing development if the housing development were not tax exempt.

(f)

Contractual effect of section. Notwithstanding the provisions of section 15(a)(5) of the Act to the contrary, a contract between the City of Sturgis and the sponsor with the authority as third party beneficiary under the contract, to provide tax exemption and accept payments in lieu of taxes, as previously described, is effectuated by enactment of this section.

(g)

Verification of annual shelter rent. The sponsor shall verify annual shelter rent revenues to the city with a statement of profit and loss of the housing development as reported to the authority by an independent certified public accountant or such other form of financial documentation deemed suitable by the city. The statement of profit and loss, or such other form of financial documentation acceptable to the city, together with a statement describing the methodology by with the sponsor calculated the service charge, shall be submitted to the city treasurer by April 30 each year.

(h)

Duration. This section shall remain in effect and shall not terminate so long as all of the following are true:

(1)

The housing development remains subject to income and rent restrictions under the LIHTC Program.

(2)

Construction of the housing development commences within one year from the award of a low-income housing tax credit for the housing development from the authority and is completed within 18 months from commencement of construction unless extensions are approved by resolution of the Sturgis City Commission.

(i)

Payment of service charge. The annual service charge in lieu of taxes as determined under this section shall be payable in the same manner as general property taxes are payable to the city and distributed to the several units levying the general property tax in the same proportion as prevailed with the general property tax in the previous calendar year. An exception to this is that the annual payment for each operating year shall be paid on or before June 1st of the following year. Collection procedures shall be in accordance with the provisions of the General Property Tax Act (1893 PA 206, as amended; MCL 211.1, et seq.), including applicable provisions of the Charter and Ordinances for the City of Sturgis, with respect to such payment, including, but not limited to the provisions providing for interest and penalties on late payments, return of delinquent taxes, and the sale of the lands for delinquent taxes.

(j)

Termination. The tax exemption extended hereunder may be terminated and the property restored to the tax rolls by resolution duly adopted by the city in any of the following events. Any default must be noticed in writing to the sponsor and the authority by certified mail (return receipt requested) or by nationally recognized overnight carrier (with receipt acknowledged in writing) to the address on file with the department of labor and economic growth or any successor department. Termination can only progress if there is failure by the sponsor to cure the default within 30 days following delivery of written notice to the sponsor. Determinations of the event and continuing existence of default and the sufficiency of actions taken to cure default shall be in the sole judgment of the city.

(1)

Failure of the sponsor or the Housing Development to remain in compliance with the terms of this section or the Act.

(2)

Failure of the sponsor to complete construction as provided in subsection (h)(3) hereof.

(3)

Failure of the sponsor to provide such reports and documentation as may be required by subsection (g) hereof.

(k)

Severability. The various subsections and provisions of this section shall be deemed to be severable, and should any subsection or provision of this section be declared by any court of competent jurisdiction to be unconstitutional or invalid the same shall not affect the validity of this section as a whole or any subsection or provision of this section, other than the subsection or provision so declared to be unconstitutional or invalid.

(l)

Inconsistent ordinances or sections. All ordinances or parts of ordinances inconsistent or in conflict with the provisions of this section are repealed to the extent of such inconsistency or conflict.

(m)

Effective date and automatic repeal. This ordinance section shall become effective 20 days after its passage, as provided in the City of Sturgis Charter. In the event the sponsor does not receive an award of a low-income housing tax credit for the housing development from the authority on or before August 31, 2022, this section shall be automatically repealed without further action of the city.

(Ord. of 3-11-2020(2); Ord. of 12-21-2020)

(a)

Purpose. It is acknowledged that it is a proper public purpose of the State of Michigan and its political subdivisions to provide housing for its low income persons and families and to encourage the development of such housing by providing for a service charge in lieu of property taxes in accordance with the Act. The City of Sturgis is authorized by this Act to establish or change the service charge to be paid in lieu of taxes by any or all classes of housing exempt from taxation under this Act at any amount it chooses, not to exceed the taxes that would be paid but for this Act. It is further acknowledged that such housing for low income seniors is a public necessity, and as the City of Sturgis will be benefited and improved by such housing, the encouragement of the same by providing real estate tax exemption for such housing is a valid public purpose. It is further acknowledged that the continuance of the provisions of this section for tax exemption and the service charge in lieu of all ad valorem taxes during the period contemplated in this section are essential to the determination of economic feasibility of the housing development that is constructed with financing extended in reliance on such tax exemption.

The City of Sturgis acknowledges that the sponsor (as defined below) has offered, subject to receipt of an allocation under the LIHTC Program by the Michigan State Housing Development Authority, to construct, own and operate a housing development identified as Monroe Street Lofts to serve low income seniors, and that the sponsor has offered to pay the city on account of this housing project an annual service charge for public services in lieu of all ad valorem property taxes. Monroe Street Lofts will be established on certain property located at 200 E. Chicago Road, parcel identification number 052-040-218-00, and 111 N. Monroe Street, parcel identification number 052-040-214-00, in the City of Sturgis; these parcels may in the future be combined as provided for under Michigan State law and the City of Sturgis Code of Ordinances.

(b)

Definitions. The following words, terms and phrases, when used in this section, shall have the meanings ascribed to them in this subsection, except where the context clearly indicates a different meaning:

Act means the State Housing Development Authority Act, being Public Act 346 of 1966, of the State of Michigan, as amended.

Annual shelter rent means the total collections during an agreed annual period from or paid on behalf of all occupants of the housing development representing rent or occupancy charges, exclusive of utilities.

Authority means the Michigan State Housing Development Authority.

City means the City of Sturgis, a Michigan municipal corporation.

Housing development means the Monroe Street Lofts; a development that contains a significant element of housing for seniors (defined as per the LIHTC Program) of low to moderate income and such elements of other housing, commercial, recreational, industrial, communal and educational facilities as the Authority has determined improves the quality of the development as it relates to housing for persons of low income.

LIHTC program means the low income housing tax credit program administered by the authority under Section 42 of the Internal Revenue Code of 1986, as amended.

Low income seniors means senior persons and their families, as defined by the LIHTC program eligible to move into the housing development constructed and maintained by the sponsor.

Mortgage loan means a loan that is federally-aided (as defined in Section 11 of the Act) or a loan or grant made or to be made by the authority to the sponsor for the construction, rehabilitation, acquisition and/or permanent financing of a housing development, and secured by a mortgage on the housing development.

PILOT means "payment in lieu of tax" or a service charge in lieu of property taxes in accordance with the Act.

Sponsor means TWG Sturgis, LP which has or intends to apply to the authority for an allocation of low income housing tax credits to finance a housing development.

Utilities means charges for gas, electric, water, sanitary sewer and other utilities furnished to the occupants that are paid by the housing project.

(c)

Class of housing projects. It is determined that the class of housing developments to which the tax exemption shall apply and for which a service charge shall be paid in lieu of such taxes shall be housing developments for low income seniors that are financed with a mortgage loan. It is further determined that Monroe Street Lofts is of this class. Passage of this section shall not be deemed precedent for other similar PILOT ordinances.

(d)

Establishment of annual service charge. The housing development identified as Monroe Street Lofts and the property on which it will be located shall be exempt from all ad valorem property taxes from and after the commencement of construction. The City of Sturgis acknowledges that the sponsor and the authority have established the economic feasibility of the housing development in reliance upon the enactment and continuing effect of this section, and the qualification of the housing development for exemption from all ad valorem property taxes and a payment in lieu of taxes as established in this section. Therefore, in consideration of the sponsor's offer to construct and operate the housing development the city agrees to accept payment of an annual service charge for public services in lieu of all ad valorem property taxes subject to the requirements of subsections (g) and (h) hereto. Subject to receipt of a mortgage loan for the housing development, the annual service charge shall be equal to eight and one-quarter percent of the annual shelter rents actually collected by the housing project but not less than $15,000.00 during each operating year.

(e)

Limitation on the payment of annual service charge. Notwithstanding subsection (d), the service charge to be paid each year in lieu of taxes for the part of the housing development that is tax exempt but which is occupied by other than low income seniors shall be equal to the full amount of the taxes which would be paid on that portion of the housing development if the housing development were not tax exempt.

(f)

Contractual effect of section. Notwithstanding the provisions of section 15(a)(5) of the Act to the contrary, a contract between the City of Sturgis and the sponsor with the authority as third party beneficiary under the contract, to provide tax exemption and accept payments in lieu of taxes, as previously described, is effectuated by enactment of this section.

(g)

Verification of annual shelter rent. The sponsor shall verify annual shelter rent revenues to the city with a statement of profit and loss of the housing development as reported to the authority by an independent certified public accountant or such other form of financial documentation deemed suitable by the city. The statement of profit and loss, or such other form of financial documentation acceptable to the city, together with a statement describing the methodology by with the sponsor calculated the service charge, shall be submitted to the city treasurer by April 30 each year.

(h)

Duration. This section shall remain in effect and shall not terminate so long as all of the following are true:

(1)

The housing development remains subject to the age requirements, income, and rent restrictions under the LIHTC Program.

(2)

Construction of the housing development commences within one year from the award of a low-income housing tax credit for the housing development and is completed within 18 months from commencement of construction unless extensions are approved by resolution of the Sturgis City Commission.

(i)

Payment of service charge. The annual service charge in lieu of taxes as determined under this section shall be payable in the same manner as general property taxes are payable to the city and distributed to the several units levying the general property tax in the same proportion as prevailed with the general property tax in the previous calendar year. An exception to this is that the annual payment for each operating year shall be paid on or before June 1st of the following year. Collection procedures shall be in accordance with the provisions of the General Property Tax Act (1893 PA 206, as amended; MCL 211.1, et seq.), including applicable provisions of the Charter and Ordinances for the City of Sturgis, with respect to such payment, including, but not limited to the provisions providing for interest and penalties on late payments, return of delinquent taxes, and the sale of the lands for delinquent taxes.

(j)

Termination. The tax exemption extended hereunder may be terminated and the property restored to the tax rolls by resolution duly adopted by the city in any of the following events. Any default must be noticed in writing to the sponsor and the authority by certified mail (return receipt requested) or by nationally recognized overnight carrier (with receipt acknowledged in writing) to the address on file with the department of labor and economic growth or any successor department. Termination can only progress if there is failure by the sponsor to cure the default within 30 days following delivery of written notice to the sponsor. Determinations of the event and continuing existence of default and the sufficiency of actions taken to cure default shall be in the sole judgment of the city.

(1)

Failure of the sponsor or the housing development to remain in compliance with the terms of this section or the Act.

(2)

Failure of the sponsor to complete construction as provided in subsection (h)(3) hereof.

(3)

Failure of the sponsor to provide such reports and documentation as may be required by subsection (g) hereof.

(k)

Severability. The various subsections and provisions of this section shall be deemed to be severable, and should any subsection or provision of this section be declared by any court of competent jurisdiction to be unconstitutional or invalid the same shall not affect the validity of this section as a whole or any subsection or provision of this section, other than the section or provision so declared to be unconstitutional or invalid.

(l)

Inconsistent ordinances or sections. All ordinances or parts of ordinances inconsistent or in conflict with the provisions of this section are repealed to the extent of such inconsistency or conflict.

(m)

Effective date and automatic repeal. This ordinance section shall become effective 20 days after its passage, as provided in the City of Sturgis Charter. In the event the sponsor does not receive an award of a low-income housing tax credit for the housing development from the authority on or before August 31, 2022, this section shall be automatically repealed without further action of the city.

(Ord. of 3-11-2020(3); Ord. of 12-21-2020)

In order to protect the city from extraordinary expenses resulting from the utilization of city resources in response to certain public safety or fire emergency incidents, this division authorizes the imposition of charges to recover actual costs incurred by the city in responding to such incidents.

(Ord. of 12-19-2001, § 4.01)

The following words, terms and phrases, when used in this division, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning:

Assessable costs means those costs for services incurred by the city in connection with a response to a public safety or fire emergency incident, including, but not limited to, the actual labor and material costs of the city (including, without limitation, employee wages, fringe benefits, administrative overhead, costs of equipment, costs of equipment operation, costs of materials, costs of transportation, costs of material disposal and costs of contracted labor) whether or not the services are provided by the city or by a third party on behalf of the city; service charges and interest; attorney's fees, litigation costs and any costs, charges, fines or penalties to the city imposed by any court or state or federal governmental entities.

Bomb threats means the verbal or written threat of a bomb or other explosive device which if discharged as threatened would violate a federal, state or local law.

Emergency assistance means emergency medical, public safety, police, fire and civil defense services.

Excessive requests for emergency assistance means any request for emergency assistance made to a particular location or premises if such location or premises has requested emergency assistance more than five times in the preceding 30 days.

False alarm means any automated or manual device designed to request or summon emergency assistance, which device is activated, intentionally or otherwise, in the absence of an actual need for emergency assistance. The determination that there was no actual need for emergency assistance shall be made by the most senior person responding to a false alarm. However, a false alarm shall not be deemed to have occurred if:

(1)

It is caused by an act of God, i.e., a lightning storm;

(2)

It originates from a motor vehicle alarm system; or

(3)

It has not occurred more frequently than three times in a calendar month or four times in a calendar year.

Hazardous material incident or emergency means any occurrence, incident, activity, accident or emergency where a release of hazardous materials occurs or is reasonably imminent and where the fire chief has so declared such activity, accident or emergency a hazardous material incident or emergency.

Hazardous materials means those elements, substances, wastes or byproducts, including, but not limited to, combustible liquid, flammable gas, explosives, flammables, poisons, organic peroxides, oxidizers, pyrophorics, unstable reactive matter, water reactive matter, petroleum products, antifreeze, polychloinated biphenyls and asbestos, which are or are potentially harmful to the environment or human or animal life, or which pose an unreasonable or imminent risk to life, health or safety of persons or property, or to the ecological balance of the environment as determined by the fire chief or the senior fire official of the city in charge at the scene.

Illegal fire means a fire set or determined to have been set in violation of a federal, state or local law and shall include an arson fire and a fire set in violation of a no-burning ban or order. An illegal fire does not include an unintentional fire or fire caused by an act of God, i.e., a lightning storm.

Motor vehicle means any self-propelled or towed vehicle designed or used on the public streets, roads and highways to transport passengers or property which is required to be registered for use upon such public streets, roads and highways and, for the purposes of this definition, all trailers or appurtenances attached to any motor vehicle.

Public safety or fire emergency incident means:

(1)

Excessive requests for emergency assistance;

(2)

A false alarm;

(3)

A hazardous material incident or emergency;

(4)

An illegal fire;

(5)

Bomb threats;

(6)

Threats of harm to oneself or others;

(7)

A structure demolition; or

(8)

A utility line failure.

Release means any actual or threatened spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, leaching, dumping or disposing into the environment, including, but not limited to, the air, soil, groundwater and surface water.

Responsible party means any individual, firm, corporation, association, partnership, commercial entity, consortium, joint venture, government entity or any other legal entity responsible for a public safety or fire emergency incident or any owner, tenant, occupant or party in control of real and personal property from which, onto which or related to which there is a public safety or fire emergency incident and their heirs, estates, successors and assigns.

Structure demolition means the tearing down of a structure damaged by fire which must in the opinion of the fire chief be promptly demolished following the fire to protect public safety.

Threats of harm to oneself or others means the verbal or written threat of physical harm to oneself or another or another's property which if carried out would be a violation of federal, state or local law.

Utility line failure means the disabling of any transmission or service line, cable, conduit, pipeline, wire or the like used to provide, collect or transport natural gas or communication or electronic signals (including, but not limited to, telephone, computer, cable television and stereo signals or electronic impulses), if the owner or party responsible for the maintenance of such utility line does not respond within one hour to a request to repair or correct such failure.

(Ord. of 12-19-2001, § 4.02)

Cross reference— Definitions generally, § 1-2.

(a)

The city may recover all assessable costs in connection with a public safety or fire emergency incident from any or all responsible parties jointly or severally.

(b)

The fire chief shall determine the total assessable costs and shall in consultation with other city personnel involved in responding to a public safety or fire emergency incident determine whether to assess any, all or part of such costs against any of the responsible parties. In making such determination, the following shall be considered:

(1)

The total assessable costs;

(2)

The risk the public safety or fire emergency incident imposed on the city, its residents and their property;

(3)

Whether there was any injury or damage to person or property;

(4)

Whether the public safety or fire emergency incident required evacuation;

(5)

The extent the public safety or fire emergency incident required an unusual or extraordinary use of city personnel and equipment; and

(6)

Whether there was any damage to the environment.

(c)

After consideration of the factors in subsection (b) of this section, the fire chief may allocate assessable costs among and between responsible parties, including allocating all or some of such costs jointly and severally against more than one responsible party regardless of whether a responsible party has other legal liability therefor or is legally at fault.

(d)

If the fire chief determines not to assess all or a part of assessable costs against a responsible party, such determination shall not in any way limit or extinguish the liability of the responsible party to other parties.

(Ord. of 12-19-2001, § 4.03)

After determining to assess assessable costs against a responsible party, the city treasurer shall mail an itemized invoice to the responsible party at its last known address. Such invoice shall be due and payable within 30 days of the date of mailing and any amounts unpaid after such date shall bear a late payment fee equal to one percent per month or fraction thereof that the amount due and any previously imposed late payment fee remains unpaid. If a responsible party shall appeal assessable costs pursuant to section 2-320, such costs, if upheld, in whole or in part, shall be due and payable 30 days from the date of determination of the appeal and any late payment fees shall apply thereafter.

(Ord. of 12-19-2001, § 4.04)

Any responsible party who receives an invoice for assessable costs shall have an opportunity to meet with the city manager to request a modification of assessable costs. The responsible party shall request in writing such meeting within seven calendar days of the date of the invoice assessing the assessable costs. Any request to meet with the city manager shall specifically identify and explain all reasons why the responsible party believes the assessed costs should be modified. Any reason, basis or argument for modification of assessable costs not set forth in the request shall be deemed waived by the responsible party. Failure to timely file a written request to meet shall constitute a waiver of the responsible party's right to appeal, and shall further constitute the responsible party's agreement to pay the assessable costs invoiced. After a responsible party has been given an opportunity to meet with the city manager, the city manager shall promptly determine whether to confirm, modify or void the payment of assessable costs invoiced.

(Ord. of 12-19-2001, § 4.05)

Assessable costs assessed against a responsible party not paid when due, including late payment fees, shall constitute a lien upon the real or personal property of the responsible party in the city, from which, upon which or related to which the public safety or fire emergency incident occurred. Such lien shall be of the same character and effect as the lien created by the city Charter for city real or personal property taxes and shall include accrued interest and penalties. The city treasurer shall, prior to March 1 of each year, certify to the city assessor the fact that such assessable costs are delinquent and unpaid. The city assessor shall then enter the delinquent amount on the next general ad valorem tax roll as a charge against the affected property, and the lien thereon shall be enforced in the same manner as provided and allowed by law for delinquent and unpaid real or personal property taxes.

(Ord. of 12-19-2001, § 4.06)

In addition to the remedy set forth in section 2-321, the city shall be entitled to pursue any other remedy or may institute any appropriate action or proceeding in a court of competent jurisdiction as permitted by law to collect assessable costs from a responsible party.

(Ord. of 12-19-2001, § 4.07)

The recovery of assessable costs pursuant to this division does not limit the liability of a responsible party under applicable local, state or federal law.

(Ord. of 12-19-2001, § 4.08)

There is hereby established for and in the city a commission to be known as the Sturgis Cable Television Commission with all of the privileges, powers and authority granted hereunder. As used in this article, the term "commission" shall mean the Sturgis Cable Television Commission.

(Code 1969, § 35.01)

(a)

Number. The commission shall consist of seven members appointed by the mayor with the consent of the city commission.

(b)

Term. A member of the commission shall be appointed for a term of three years. To provide staggered terms, the terms of the initial appointments to the commission shall be for shorter terms as provided in this article.

(c)

Qualification. Each member of the commission shall be a resident of the city to be qualified for appointment to the commission and to remain qualified as a member of the commission. Should any member cease to be a resident of the city after appointment, then that member shall be disqualified from further service and a vacancy on the commission shall exist. No person shall be appointed to the commission who is currently a candidate for or has been elected and is now serving in the position of city commissioner for the city and such persons shall be disqualified for membership on the commission.

(d)

Initial appointments. The mayor, with the consent of the city commission shall establish the term of each of the initial appointments to the commission for the purpose of creating staggered terms as required in this article. the terms of three members shall expire at the end of one year, the terms of two members shall expire at the end of two years and the term of the remaining two members shall expire at the end of three years; however, each appointment thereafter shall extend for the full term as established in this article.

(e)

Vacancy. Vacancies occurring in the commission shall be filled for the unexpired term in the same manner as for appointment to the commission.

(f)

Removal. The commission shall have authority to remove any of its members by an affirmative vote of at least five-sixth of the remaining members of the commission. Among other reasons, the commission may remove a member for failure to attend meetings, failure to remain qualified as a member, failure to discharge the duties of office in a professional manner, conflicts of interest, breach of confidentiality, acts of misconduct which directly affect the work of the commission or the operation of the municipal cable television system or other acts which cause embarrassment or bring disrepute to the commission and/or the city.

(g)

Notice of vacancy. Upon the expiration of any term, resignation, retirement or removal of any member, the chairman of the commission shall notify the mayor that a vacancy exists.

(Code 1969, § 35.02)

(a)

Meetings. The city manager shall schedule an initial organizational meeting of the commission upon the initial appointment of the commission. At such initial organizational meeting, the communications department manager shall act as temporary chair, and the commission shall organize itself and elect from its members a chairman and a secretary who shall serve for a one year term or until successors in office are appointed. The commission shall have authority to elect such other officers as it may deem necessary. The commission shall hold regular meetings for the transaction of its business at such place and at such times as the commission deems appropriate and special meetings may be held at any time when the chairman or any two members of the commission shall deem it appropriate. All meetings of the commission shall be open to the public. Proper notice for each meeting shall be given and the commission shall comply with all applicable requirements of the Michigan Open Meetings Act (MCL 15.261 et seq.).

(b)

Duties of officers. It shall be the duty of the chairman to preside over all meetings of the commission. In the chairman's absence, a temporary chairman may be appointed to preside. It shall be the duty of the secretary to keep a record of all proceedings of the commission, transmit its recommendations to the city commission and to perform such other duties as are commonly performed by the secretary of a deliberative body.

(c)

Staff. The communications department manager shall have authority to appoint a staff person in the employment of the city as liaison between the commission and the city. The staff person so assigned shall provide administrative and technical assistance to the commission in its work and carry out such other duties as may be assigned by the commission.

(d)

Minutes and records. The commission shall keep a full record of its proceedings and minutes of its meetings showing the business transacted at each meeting and shall submit copies thereof to the city manager. All records of the commission shall be subject to the Michigan Freedom of Information Act (MCL 15.231 et seq.).

(Code 1969, § 35.04)

(a)

General. Except as may be otherwise provided by this section, the powers and duties of the commission are generally advisory in nature and the commission shall not have any powers or duties which conflict with or supersede the powers and duties of the city commission or city boards, except as provided in this article or which conflict with the authority of the city commission. Advice, recommendations and decisions made by the commission regarding the rates and financial matters involving the municipal cable television system shall be subject to the final approval of the city commission.

(b)

Programming. The commission shall make all decisions concerning the programming to be provided by the municipal cable television system. Such decision shall not be reviewable by nor subject to the approval of the city commission, any city officer, the city manager or any staff person in the employment of the city. Such decision shall be final when rendered by the commission.

(c)

Other responsibilities. The commission shall discharge such additional functions and carry out other responsibilities as may be assigned to the commission from time to time by the city commission including, among other things, the following:

(1)

To confer with and advise the city commission on all matters concerning the ownership, management and operation of the municipal cable television system;

(2)

To confer with and advise the communications department manager on the management and operation of the municipal cable television system; and

(3)

To confer with and consider requests from citizens and community groups concerning services to be provided by any cable television system.

(Code 1969, § 35.03)

(a)

Pursuant to Public Act No. 18 of the extra session of 1933 (MCL 125.651 et seq.) ("act"), a commission is hereby created in and for the city to be known as the "Sturgis Housing Commission."

(b)

The mayor and city commission are hereby authorized and directed to appoint the members of the city housing commission as soon as possible after this Code shall take effect as provided in the act.

(Code 1969, § 31.01; Ord. of 7-12-2006)

State Law reference— Authority to create housing commission, MCL 125.653.

(a)

The commission shall have the powers and duties as set forth in section 7 of the act.

(b)

All deeds, mortgages, contracts, leases, purchases, or other agreements regarding real property, including agreements to acquire or dispose of real property, shall be solely approved by and executed in the name of the city housing commission.

(c)

The city housing commission is hereby authorized to act as the borrower for purposes of issuing bonds or notes under the act.

(d)

The city housing commission shall have the authority to adopt bylaws and reasonable rules and regulations as set forth in subsection 44(b) of the act.

(e)

The employees of the city housing commission shall be exclusively selected and paid as authorized by the officers of the city housing commission.

(Ord. of 7-12-2006)

(a)

All claims that may arise in connection with any project sponsored, supervised or controlled by the city housing commission shall be presented as a claim against the city housing commission, only, and the city shall have no liability with respect to any such claim.

(b)

Any claim relating to a note, bond, or other obligation, or any other claim of whatever nature relating to any project sponsored, supervised or controlled by the city housing commission, shall not be a debt or charge against the city nor any member of the city housing commission, and no individual liability shall attach for any official act done by any member of the city housing commission.

(Ord. of 7-12-2006)

(a)

The city local officers compensation commission ("commission") is hereby created. The commission shall consist of five members, each of whom shall be registered electors of the city. Each member shall be appointed by the mayor, but shall not serve until confirmed by majority vote of the city commission. In no event may a member of the city commission, an employee of the city or an immediate family member of the city commission or employee of the city be a member of the commission.

(b)

The members of the local officers compensation commission shall serve five-year terms; provided, however, that each of the initial members shall be appointed for terms of one, two, three, four, and five years, respectively. The initial members shall be appointed within 30 days after the effective date of this section. After the initial members are appointed, all successor members shall be appointed before October 1 of the year of appointment.

(c)

The commission shall appoint a chairperson from its members.

(d)

The members of the commission shall not receive compensation, but shall be entitled to reimbursement of actual and necessary expenses incurred in the performance of official duties.

(Code 1969, § 34.01)

(a)

A member may be removed from the commission for any reason whatsoever upon two-thirds vote of the city commission.

(b)

If a member becomes unable to serve, refuses to serve, or is removed from his position before the expiration of his or her term, the vacancy shall be filled for the remainder of the unexpired term in the same manner provided under section 2-416.

(Code 1969, § 34.02)

The local officers compensation commission shall determine the salary of each city elected official. The determination shall be the salary unless the city commission, by resolution adopted by two-thirds of the members elected to and serving on the city commission, rejects it. The determination of the local officers compensation commission shall be effective 30 days following its filing with the city clerk-treasurer unless rejected by the city commission. If the determination is rejected, the existing salary shall prevail. The expense allowance or reimbursement paid to elected officials in addition to salary shall be for expenses incurred in the course of city business and accounted for to the city.

(Code 1969, § 34.03(A))

State Law reference— Similar provisions, MCL 117.5c(b).

The local officers compensation commission shall meet for not more than 15 session days in each odd numbered year and shall make its determination within 45 calendar days after its first meeting. A majority of the members of such commission constitutes a quorum for conducting the business of such commission. Such commission shall not take action or make a determination without a concurrence of a majority of the members appointed and serving on such commission. Such commission shall elect a chairperson from among its members. As used in this section, the term "session day" means a calendar day on which such commission meets and a quorum is present. The members of such commission shall not receive compensation, but shall be entitled to actual and necessary expenses incurred in the performance of official duties.

(Code 1969, § 34.03(B))

State Law reference— Similar provisions, MCL 117.5c(c).

(a)

The business which the local officers compensation commission may perform shall be conducted at a public meeting of the local officers compensation commission held in compliance with Public Act No. 267 of 1976 (MCL 15.261 et seq.) Public notice of the time, date, and place of the meeting of the local officers compensation commission shall be given in the manner required by such act.

(b)

A writing prepared, owned, used, in the possession of, or retained by the commission in the performance of an official function shall be made available to the public in compliance with Public Act No. 442 of 1976 (MCL 15.231 et seq.).

(Code 1969, § 34.04)

State Law reference— Similar provisions, MCL 117.5c(c), (d).

This division, including the establishment of the commission and its powers, shall control the method and procedure for establishing salaries of the city's elected officials, notwithstanding any other ordinance or city Charter provision to the contrary.

(Code 1969, § 34.05)

(a)

A city planning board is hereby created.

(b)

The planning board shall consist of nine members, who shall represent insofar as possible different professions or occupations, and who shall be appointed by the mayor subject to the approval of a majority vote of the members elect of the city commissioners. All members of the planning board shall serve as such without compensation and shall hold no other municipal office, except that one of such members may be a member of the zoning board of adjustment or appeals. The term of each member of the planning board shall be three years, except that three members of the first board to be so appointed shall serve for the term of one year, three for a term of two years and three for a term of three years. All members of the planning board shall hold office until their successors are appointed. Members of the planning board may, after a public hearing, be removed by the mayor for inefficiency, neglect of duty or malfeasance in office. Vacancies occurring in the membership of the planning board shall be filled for the unexpired term by the appointive power.

(Code 1969, § 31.30)

State Law reference— Authority to create planning commission and membership thereof, MCL 125.33.

The constituted planning board shall elect its chairman from its members and create and fill such other of its offices as it may determine from among its members. The term of the chairman shall be one year, with eligibility for re-election. The planning board shall hold at least one regular meeting in each month. The planning board shall adopt rules for transaction of business and shall keep a record of its resolutions, transactions, findings, and determinations. This record shall be a public record, and on or before the first day of April of each year the city planning board shall furnish to the city commission a report of its activities, including outlines of future programs and estimates of operational expenses for the ensuing fiscal year, together with a report of any and all items of expense or obligation created by the planning board.

(Code 1969, § 31.31)

State Law reference— Similar provisions, MCL 125.34.

The city commission shall provide for a secretary of this planning board who shall keep a record of the proceedings and actions of the board, but he shall not have any vote. The record of proceedings of the planning board is to be presented to the city clerk-treasurer each month and kept in his office and shall be deemed a public record. The planning board may also recommend to the city commission contracts with city planners, engineers, architects, and other consultants for such services as it may require. The planning board may also contact the city manager, the city engineers and other city employees for such information as shall be deemed helpful in carrying out the purposes of the planning board. Expenditures of the planning board, exclusive of gifts received, shall not exceed the amounts appropriated for its use by the city commission, which shall provide the funds, equipment, and accommodations necessary for the work of the planning board.

(Code 1969, § 31.32)

Subject to section 2-442, the city planning board may hold, when directed or authorized by the city commission, such meetings and/or hearings, from time to time, as it may deem advisable or necessary in connection with the proper performance of its functions under this article. Joint meetings of the city commission and of the city planning board shall be held at least quarterly at a time to be designated by the mayor, and it shall be the duty of the city clerk-treasurer to call such meetings in accordance with the provisions hereof. In addition to the provisions of this section, any member of the city commission may call for a joint meeting.

(Code 1969, § 31.33)

The city planning board shall make and adopt a master plan for the physical development of the city, including any areas outside of its boundaries which, in the board's judgment, bear relation to the planning of the city. In this regard, the planning board may advise and cooperate with the planning and legislative bodies of other governmental units in any area outside the boundaries of the city. The plan, with the accompanying maps, plats, charts, and descriptive matter shall show the board's recommendations for the development of the territory, including, among other things, the general location, character, and extent of streets, viaducts, subways, bridges, waterways, floodplains, water fronts, boulevards, parkways, playgrounds and open spaces, the general location of public buildings and other public property, and the general location and extent of public utilities and terminals, whether publicly or privately owned or operated, for water, light, sanitation, transportation, communication, power, and other purposes; also the removal, relocation, widening, narrowing, vacating, abandonment, change of use or extension of any of the foregoing ways, grounds, open spaces, buildings, property, utilities or terminals; the general location, character, layout and extent of community centers and neighborhood units; and the general character, extent and layout of the replanning and redevelopment of blighted districts and slum areas; as well as a zoning plan for the control of the height, area, bulk, location, and use of buildings and premises. As the work of making the whole master plan progresses, the planning board from time to time may adopt and publish parts thereof, any such part to cover one or more major sections or divisions of the city or one or more of the other functional matters to be included in the plan. The planning board from time to time may amend, extend, or add to the plan.

(Code 1969, § 31.33)

State Law reference— Similar provisions, MCL 125.34.

(a)

The city planning board may adopt the plan as a whole by a single resolution. The planning board may by successive resolutions adopt successive parts of the plan corresponding with major geographical sections or divisions of the city or with functional subdivisions of the subject matter of the plan. The planning board may adopt any amendment or extension of the plan or addition to the plan.

(b)

Before the adoption of the plan or any part, amendment, extension, or addition to the plan, the planning board shall hold not less than one public hearing. Notice of the time and place of the public hearing shall be given not less than 15 days prior to the hearing by one publication in a newspaper of general circulation in the city and in the official gazette, if any, of the city, and by registered United States mail to each public utility company and to each railroad company owning or operating any public utility or railroad within the geographical sections or divisions of the city affected.

(c)

The adoption of the plan or any part, amendment, extension, or addition to the plan shall be by resolution of the planning board carried by the affirmative votes of not less than two-thirds of the members of the planning board. The resolution shall refer expressly to the maps and descriptive and other matter intended by the planning board to form the whole or part of the plan, and the action taken shall be recorded on the map and plan and descriptive matter by the identifying signature of the chairperson or the secretary of the board.

(d)

An attested copy of the plan or part of the plan shall be certified to the city commission and to the county register of deeds.

(Code 1969, § 31.34)

State Law reference— Similar provisions, MCL 125.38.

Whenever the city commission shall have ordered the opening, widening or extension of any street, avenue or boulevard, or whenever the city commission shall have ordered that proceedings be instituted for the acquisition or enlargement of any park, playground, playfield or other public open space, such resolution shall not be rescinded until after the matter has been referred back to the city planning board for a report and until after a public hearing shall have been held. The city commission shall have power to overrule the recommendation of the city planning board by a vote of not less than two-thirds of its entire membership.

(Code 1969, § 31.35)

State Law reference— Similar provisions, MCL 125.40.

The planning board may appoint such employees as it may deem necessary for its work, whose appointment, promotion, demotion, and removal shall be subject to the same provisions of law as govern other corresponding civil employees of the city. The planning board may also contract with city planners, engineers, architects, and other consultants for such services as it may require. The expenditures of the planning board, exclusive of gifts, shall be within the amounts appropriated for the purpose by city commission, which shall provide the funds, equipment, and accommodations necessary for the planning board's work.

(Code 1969, § 31.36)

State Law reference— Similar provisions, MCL 125.35.

Whenever the planning board shall have adopted the master plan of the city or of one or more major sections or districts thereof no street, square, park, or other public way, ground, or open space, or public building or structure, shall be constructed or authorized in the city or in such planned section and district until the location, character, and extent thereof shall have been submitted to and approved by the planning board. Provided, that in case of disapproval the planning board shall communicate its reasons to city commission, which shall have the power to overrule such disapproval by a recorded vote of not less than two-thirds of its entire membership: Provided, however, that if the public way, ground, space, building, structure, or utility be one the authorization or financing of which does not under the law or charter provisions governing such public way, ground, space, building, structure, or utility, fall within the province of the city commission, then the submission to the planning board shall be by the board, commission, or body having such jurisdiction, and the planning board's disapproval may be overruled by such board, commission, or body by a vote of not less than two-thirds of its membership. The failure of the planning board to act within 60 days from and after the date of official submission to the planning board shall be deemed approval. For the purpose of furthering the desirable future development of the city under the master plan the city planning board, after the planning board shall have adopted a master plan, shall prepare coordinated and comprehensive programs of public structures and improvements. The planning board shall annually prepare such a program for the ensuing six years, which program shall show those public structures and improvements, in the general order of their priority, which in the planning board's judgment will be needed or desirable and can be undertaken within the six-year period. The above comprehensive coordinated programs shall be based upon the requirements of the community for all types of public improvements, and, to that end, each agency or department of such city concerned with such improvements shall upon request furnish the planning board with lists, plans and estimates of time and cost of public structures and improvements within the purview of such department.

(Code 1969, § 31.36)

State Law reference— Similar provisions, MCL 125.39.

The planning board shall have the power to promote public interest in and understanding of the plan and to that end may publish and distribute copies of the plan or of any report and may employ such other means of publicity and education as it may determine. Members of the planning board, when duly authorized by the planning board, may attend city planning conferences or meetings of city planning institutes, or hearings upon pending municipal planning legislation, and the planning board may, by resolution spread upon its minutes, pay the reasonable traveling expenses incident to such attendance. The planning board shall, from time to time, recommend to the appropriate public officials programs for public structures and improvements and for the financing thereof. It shall be part of the planning board's duties to consult and advise with public officials and agencies, public utility companies, civic, educational, professional, and other organizations, and with citizens with relation to the protecting or carrying out the plan. The planning board shall have the right to accept and use gifts for the exercise of its functions. All public officials shall, upon request, furnish to the planning board, within a reasonable time, such available information as it may require for its work. The planning board, its members, officers, and employees, in the performance of their functions, may enter upon any land and make examinations and surveys and place and maintain necessary monuments, and marks thereon. In general, the planning board shall have such powers as may be necessary to enable it to fulfill its functions, promote municipal planning, or carry out the purposes of this division.

(Code 1969, § 31.36)

State Law reference— Similar provisions, MCL 125.41.

Whenever planning board shall have adopted that sort of a master plan relating to the major street system of the territory within its subdivision jurisdiction or part thereof, and shall have filed a certified copy of such plan in the office of the county register of deeds of the county, then no plat of a subdivision of land within such territory or part shall be filed or recorded until it shall have been approved by such planning board and such approval entered in writing on the plat by the chairman or secretary of the planning board.

(Code 1969, § 31.37)

State Law reference— Similar provisions, MCL 125.43.

(a)

Before exercising the powers referred to in section 2-451, the planning board shall adopt regulations governing the subdivision of land within its jurisdiction. Such regulations may provide for the proper arrangement of streets in relation to other existing or planned streets and to the master plan, for adequate and convenient open spaces for traffic, utilities, access of firefighting apparatus, recreation, light and air, and for the avoidance of congestion of population, including minimum width and area of lots.

(b)

Such regulations may include provisions as to the extent to which streets and other ways shall be graded and improved and to which water and sewer and other utility mains, piping, or other facilities shall be installed as a condition precedent to the approval of the plat. The regulations or practice of the planning board may provide for a tentative approval of the plat previous to such installation; but any such tentative approval shall be revocable and shall not be entered on the plat. In lieu of the completion of such improvements and utilities prior to the final approval of the plat, the planning board may accept a bond with surety to secure to the city the actual construction and installation of such improvements or utilities at a time and according to specifications fixed by or in accordance with the regulations of the planning board.

(c)

All such regulations shall be published as provided by law for the publication of ordinances, and before adoption, a public hearing shall be held thereon. A copy thereof shall be certified by the planning board to the county recorder.

(Code 1969, § 31.38)

State Law reference— Similar provisions, MCL 125.44.

The planning board shall approve, modify or disapprove a plat within 60 days after the submission thereof to it; otherwise such plat shall be deemed to have been approved, and a certificate to that effect shall be issued by the planning board on demand. Provided, however, that the applicant for the planning board 's approval may waive this requirement and consent to an extension of such period. The ground of disapproval of any plat shall be stated upon the records of the planning board. Any plat submitted to the planning board shall contain the name and address of a person to whom notice of a hearing shall be sent; and no plat shall be acted on by the planning board without affording a hearing thereon. Notice shall be sent to such address by registered mail of the time and place of such hearing not less than five days before the date fixed therefor. Similar notice shall be mailed to the owners of land immediately adjoining the platted land, as their names appear upon the plats in the county auditor's office and their addresses appear in the directory of the city or on the tax records of the city. Every plat approved by the planning board shall, by virtue of such approval, be deemed to be an amendment of or an addition to or a detail of the municipal plan and a part thereof. Approval of a plat shall not be deemed to constitute or effect an acceptance by the public of any street or other open space shown upon the plat. The planning board may, from time to time, recommend to city commission amendments of the zoning ordinance or map or additions thereto to conform to the planning board 's recommendations for the zoning regulation of the territory comprised within approved subdivisions. The planning board shall have the power to agree with the applicant upon use, height, area or bulk requirements or restrictions governing buildings and premises within the subdivision, provided such requirements or restrictions do not authorize the violation of the then effective zoning ordinance of the city. Such requirements or restrictions shall be stated upon the plat prior to the approval and recording thereof and shall have the same force of law and be enforceable in the same manner and with the same sanctions and penalties and subject to the same power of amendment or repeal as though set out as a part of the zoning ordinance or map of the city.

(Code 1969, § 31.39)

State Law reference— Similar provisions, MCL 125.45.

The following words, terms and phrases, when used in this division, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning:

Accumulated member contributions means the balance in a member's individual account in the reserve for member contributions.

Beneficiary means an individual who is being paid or who has entitlement to the future payment of a pension on account of a reason other than the individual's membership in the retirement system.

Compensation means the salary or wages paid an employee for personal services rendered the city while a member of the retirement system. Salary and wages shall include: base salary or wages; longevity pay; cost-of-living payments; overtime pay; shift differentials; pay for periods of absence from work by reason of vacation, holiday, and sickness. Compensation shall not include any remuneration or reimbursement not specifically stated to be included.

Final average compensation means:

(1)

For all benefit groups (section 2-161) except benefit group F, the average of the annual compensations paid a member during any consecutive five years of credited service contained within the ten years of credited service immediately preceding the member's last termination of employment with the city which produces the highest average. If the member has less than five years of credited service, final average compensation means the aggregate amount of compensation paid the member divided by the member's years and fractions of a year of credited service.

(2)

For benefit group F (section 2-161), the average of the annual compensations paid a member during the last three years of credited service immediately preceding the member's last termination of employment with the city. If the member has less than three years of credited service, final average compensation means the aggregate amount of compensation paid the member divided by the member's years and fractions of a year of credited service.

Pension means a series of equal monthly payments by the retirement system.

Retired member means an individual who is being paid a pension on account of the individual's membership in the retirement system.

Service means personal service rendered the city while a member of the retirement system and qualifying military service pursuant to section 2-144 and any service credited by specific board of trustees resolution consistent with applicable law.

(Code 1969, § 33.03)

Cross reference— Definitions generally, § 1-2.

The city employees retirement system, established by Chapter XXX of the Charter of the city October 1, 1950, as amended, is continued for the purpose of providing retirement income to qualifying employees and former employees, and survivor income to their qualifying beneficiaries.

(Code 1969, § 33.01)

(a)

The continuation and restatement of the employees' retirement system will apply to individuals employed by the city on and after the effective date of the restatement. The retirement rights of an individual whose city employment terminated before the effective date of this restatement will be governed by the provisions of the retirement system ordinance in effect on the date the individual last terminated employment.

(b)

The terms of any collective bargaining agreement entered into between the city and a benefit group shall be honored by the board of trustees. In the event the provisions of this section conflict with the terms of a collective bargaining agreement, the provisions of the collective bargaining agreement shall be controlling.

(Code 1969, § 33.02; Ord. of 3-21-2005)

(a)

People employed in included positions are members of the retirement system. Included positions are positions held by all individuals who are employed by the city, its offices, boards, departments or instrumentalities in a permanent position requiring 1,950 or more hours per calendar year unless employed in an excluded position enumerated in section 2-85.

(b)

For purposes of this section, a permanent position is defined as a position on a regular rather than a temporary or seasonal basis. In case of doubt, the board of trustees shall decide whether an individual is a member.

(Code 1969, § 33.04; Ord. of 7-9-2003, § 33.04; Ord. of 11-14-2012)

Positions excluded from membership in the city retirement system are:

(1)

Positions which are compensated on a basis not subject to the withholding of federal income taxes or FICA taxes by the city or to existing fringe benefits provided by the city.

(2)

Any position held by a retired member.

(3)

Any position as an elected official of the city.

(4)

Members of boards and commissions paid exclusively on a per diem basis.

(5)

Any position held by a person who is included by law in any other pension or retirement system by reason of the compensation paid by the city, except the Federal Old Age, Survivors and Disability Insurance program.

(6)

Temporary positions.

(7)

Positions filled by part-time employees. For purposes of this section, a part-time employee is a city employee who is employed in a position normally requiring fewer than 1,950 hours of work per calendar year.

(Code 1969, § 33.05; Ord. of 7-9-2003, § 33.05; Ord. of 11-14-2012)

An individual shall cease to be a member of the retirement system upon termination of employment or upon becoming employed in an excluded position. Upon reemployment by the city in an included position entitling the employee to membership, the individual shall again become a member.

(Code 1969, § 33.06)

(a)

A person who ceases to be a member for a reason other than retirement or death shall be a vested former member if: the individual's accumulated member contributions have not been refunded and; (i) for individuals who have earned credited service prior to January 1, 2009, the individual has five or more years of credited service, (ii) for individuals who have not earned credited service prior to January 1, 2009, the individual has eight or more years of credited service or (iii) for individuals who have not earned credited service prior to January 1, 2016, the individual has ten or more years of credited service.

(b)

Such a person shall not receive service credit while absent from city employment.

(Code 1969, § 33.07; Ord. of 3-21-2005; Ord. of 12-10-2008; Ord. of 12-21-2015)

The retirement system is a reciprocal retirement system under the provisions of Public Act No. 88 of 1961 (MCL 38.1101 et seq.). This section does not require adoption by the city of Section 6 of Public Act No. 88 of 1961 (MCL 38.1106) and such section shall not apply to this division.

(Code 1969, § 33.12)

State Law reference— Authority to make Act 88 of 1961 applicable, MCL 38.1103.

(a)

The right of an individual to a pension, to a refund of accumulated member contributions, the pension itself, or any other right accrued or accruing to any individual, and the monies and assets of the retirement system, shall not be subject to execution, garnishment, attachment, the operation of bankruptcy or insolvency law, or other process of law, except as specifically required by state or federal law and shall be unassignable except as provided in subsection (b) of this section or as required by state or federal law.

(b)

If an individual is covered under group insurance or prepayment plan participated in by the city, and makes a permitted election to continue such coverage as a retired member or as a beneficiary, the individual may authorize the board of trustees to deduct from the individual's pension, payments required to continue coverage under such group insurance or prepayment plan.

(Code 1969, § 33.56)

(a)

If an individual becomes entitled to a pension or other benefit payable by the retirement system as a result of an accident or injury caused by the act or the failure to act of a third party, the city shall be subrogated to the rights of the individual against the third party to the extent of city-financed benefits which the retirement system pays or becomes liable to pay.

(b)

The retirement system shall have the right of setoff to recover overpayments made by the retirement system and to satisfy any claim arising from embezzlement or fraud committed by a member, retired member, vested former member, beneficiary, or other individual having a claim to benefits. The right to setoff to satisfy claims shall apply to embezzlement or fraud committed against the retirement system, against the city, or against any third party if, on account of the embezzlement or fraud, the city or retirement system becomes liable to a third party. If any aspect of this section is unenforceable under any current or future federal or state law, including statute, regulation, or public policy, then this section shall be ineffective only to the extent of such unenforceability, without invalidating the remaining provisions of this section.

(Code 1969, § 33.57; Ord. of 3-21-2005)

(a)

Generally. The city intends the retirement system to be a qualified pension plan under Section 401 of the Internal Revenue Code, as amended, or successor provisions of law, and that the trust be an exempt organization under Section 501 of the Internal Revenue Code. The board of trustees shall recommend for adoption by the city commissioners such additional provisions to the retirement system as are necessary to fulfill this intent.

(b)

Prohibition against reversion. The retirement system and trust have been created for the exclusive benefit of the members and beneficiaries as set forth in this division. The funds thereof have been established for the benefit of the members and for the operation of the retirement system. No part of the principal and income of any of the funds of the system and trust shall revert to or be returned to the city prior to the satisfaction of all liabilities hereunder to all members, beneficiaries and anyone claiming by or through them.

(c)

Actuarial valuation assumptions. Actuarial valuation assumptions may be changed by the board of trustees after consulting with the actuary.

(d)

Termination. In the event of termination of this plan, a member's interest under the plan as of such date is nonforfeitable to the extent funded in conformity with applicable sections of the Internal Revenue Code and Regulations.

(e)

Merger, consolidation or transfer. In conformity with Section 414(l) of the Internal Revenue Code, in the case of any transfer of assets or liabilities of this plan to any other plan, each plan participant would (if the plan then terminated) receive a benefit immediately after the transfer that is equal to or greater than the benefit the participant would have been entitled to receive immediately before the transfer (if the plan had then terminated).

(f)

Limitations of benefits. The retirement system shall not pay any benefit that would exceed the benefit limitations for governmental plans as set forth in Section 415 of the Internal Revenue Code and Regulations, as amended. For this purpose, compensation shall be determined in accordance with Internal Revenue Code Section 415(e)(3). In the event it should become necessary to reduce or restrict a benefit in order to comply with Internal Revenue Code Section 415(e), the employer-provided portion of the benefit payable under this retirement system shall be reduced or restricted to the extent necessary.

(g)

Distributions. Distributions from the retirement system will comply with the requirements of Internal Revenue Code Section 401(a)(9) and the regulations thereunder, including the following specific requirements. Distribution of a member's benefits will begin not later than April 1 of the calendar year following the later of the calendar year in which the employee attains age 70½ and the calendar year in which the employee retires. If distribution of a member's benefits commenced prior to the member's death, any remaining benefits will be distributed at least as rapidly as under the method of distribution used as [of] the date of the member's death. If distribution of a member's benefits had not commenced prior to the member's death, any portion of his or her benefits payable after the member's death shall:

(1)

If payable to the member's surviving spouse, begin no later than the end of the calendar year following the calendar year in which the member would have attained age 70½;

(2)

If payable to the member's designated beneficiary, begin no later than the end of the calendar year following the calendar year in which the member died and extend over a period not extending beyond the life expectancy of the beneficiary; or

(3)

Otherwise, be distributed within five years of the member's death.

(h)

Specific distributions. This subsection applies to distributions made on or after January 1, 1993. Notwithstanding any provision of the plan to the contrary that would otherwise limit a distributee's election under this subsection, a distributee may elect, at the time and in the manner prescribed by the board of trustees, to have any portion of an eligible rollover distribution paid directly to an eligible retirement plan specified by the distributee as a direct rollover. The following definitions shall apply with regard to this subsection.

(1)

Eligible rollover distribution. An eligible rollover distribution is any distribution of all or any portion of the balance to the credit of the distributee, except that an eligible rollover distribution does not include: any distribution that is one of series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the distributee or the joint lives (or joint life expectancies) of the distributee and the distributee's designated beneficiary, or for a specified period of ten years or more, any distribution to the extent such distribution is required under Internal Revenue Code Section 401(a)(9); and the portion of any distribution that is not includable for income tax purposes in gross income. The forgoing notwithstanding, for all distributions occurring after December 31, 2001, a portion of a distribution shall not fail to be an eligible rollover distribution merely because the portion consists of after-tax employee contributions which are not includible in gross income. However, such portion may be transferred only to an individual retirement account or annuity described in Section 408(a) or (b) of the Internal Revenue Code, or to a qualified defined contribution plan described in Section 401 (a) or 403 (a) of the Internal Revenue Code that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution which is includible in gross income and the portion of such distribution which is not so includible.

(2)

Eligible retirement plan. An eligible retirement plan is an individual retirement account described in Section 408(a) of the Internal Revenue Code, an individual retirement annuity described in Section 408(b) of the Internal Revenue Code, an annuity plan described in Section 403(a) of the Internal Revenue Code, or a qualified trust described in Section 401(a) of the Internal Revenue Code, that accepts the distributee's eligible rollover distribution. However, in the case of an eligible rollover distribution to the surviving spouse, an eligible retirement plan is an individual retirement account or individual retirement annuity. For all distributions occurring after December 31, 2001, an eligible retirement plan shall also mean an annuity contract described in Section 403(b) of the Internal Revenue Code and an eligible plan under Section 457(b) of the Internal Revenue Code which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state, and which agrees to separately account for amounts transferred into such plan from this plan. The definition of eligible retirement plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order, as defined in Section 414(p) of the Internal Revenue Code.

(3)

Distributee. A distributee includes an employee or former employee. In addition, the employee's or former employee's surviving spouse is a distributee with regard to the interest of the surviving spouse.

(4)

Direct rollover. A direct rollover is a payment by the retirement system to the eligible retirement plan specified by the distributee.

(Code 1969, § 33.59; Ord. of 12-10-2008)

The administration, management and responsibility for the proper operation of the retirement system, and for interpreting and making effective the provisions of the retirement ordinance, are vested in a board of trustees.

(Code 1969, § 33.40)

(a)

The board of trustees shall consist of the following five individuals.

(1)

The mayor by virtue of that office.

(2)

A city commissioner to be selected by the commission.

(3)

The taxpayer or elector of the city who is not a member of the retirement system, and who is not eligible for any benefits from the retirement system, to be appointed by the mayor with the consent of the city commission.

(4)

Two members of the retirement system to be elected by the members of the retirement system, provided that no more than one member trustee shall be from a single city department.

(b)

The board of trustees shall establish rules and regulations for elections required by subsection (a)(4) of this section

(Code 1969, § 33.41)

Charter reference— Similar provisions, ch. XXX, § 2.

(a)

The term of office of the member elected trustees shall be three years.

(b)

A vacancy shall occur on the board of trustees if a member elected trustee (i) ceases to be a member or (ii) becomes employed in the city department of the other member elected trustee or (iii) fails to attend three consecutive meetings unless excused for cause by the trustees attending the meetings. A vacancy shall occur on the board of trustees if any trustee resigns or is removed from office. A vacancy shall occur on the board of trustees if the taxpayer or elector trustee ceases to be a taxpayer or elector. A vacancy shall be filled within 90 days, for the unexpired term, in the same manner as the position was previously filled.

(Code 1969, § 33.42)

The board of trustees shall hold meetings regularly, at least one in each calendar quarter, and shall designate the time and place of each meeting. All meetings of the board shall be public. Three trustees shall constitute a quorum at any meeting of the board of trustees. Each trustee shall be entitled to one vote on each question before the board. At least three concurring votes shall be required for a valid action by the board of trustees. The board of trustees shall adopt its own rules of procedures and shall keep a written record of its proceedings.

(Code 1969, § 33.43)

(a)

The board of trustees shall elect from its membership a chairperson and a vice chairperson.

(b)

The city clerk-treasurer shall be the secretary of the retirement system.

(c)

The city clerk-treasurer shall be the treasurer of the retirement system. The clerk-treasurer shall be custodian of the assets of the retirement system except as to such assets as the board of trustees may from time to time place in the custody of a nationally chartered bank selected by the board of trustees.

(d)

The city attorney shall be the legal advisor to the board.

(e)

The board of trustees may designate a physician who is not eligible to participate in the retirement system as a member, retired member or beneficiary to examine a disability retirement applicant or to re-examine a disability retired member. Such examination or re-examination shall be made if the board of trustees is not satisfied with reports that may have been furnished. The conclusions and recommendations of the designated physician shall be presented to the board in writing.

(f)

The board of trustees shall designate an actuary who shall advise the board on the actuarial operation of the retirement system. Actuary shall mean a member of the American Academy of Actuaries or an individual who has demonstrated the educational background necessary to effectively render actuarial advice to the retirement system and who has at least five years of relevant pension actuarial experience. A partnership or corporation may be designated as actuary if the duties of actuary are performed by or under the direct supervision of an individual who meets the preceding requirements.

(g)

The board of trustees is authorized and empowered to employ such professional and other services as it requires for the proper discharge of its responsibilities. Such services, other than actuarial and medical, shall be engaged in the same manner as similar services are employed or engaged by other departments of the city and the compensation for such services shall be fixed in the same manner as in other departments of the city. The board of trustees may utilize the services of city employees if made available.

(Code 1969, § 33.44)

(a)

The board of trustees shall keep such records as are required to properly manage and report the operations of the retirement system. The board of trustees shall keep such additional records as are recommended by the actuary as necessary for the operation of the retirement system on an actuarial basis.

(b)

The board of trustees shall furnish the city commission a copy of the most recent actuarial report and auditor's statement and such other information about the retirement system as the city commission may from time to time request.

(c)

The secretary of the board shall maintain copies of all collective bargaining agreements between a benefit group and the city and shall maintain a current summary of all provisions that are in conflict with this section.

(Code 1969, § 33.45; Ord. of 3-21-2005)

(a)

The board of trustees are the trustees of the assets of the retirement system. The board of trustees has the authority and power to invest and reinvest the assets of the retirement system subject to all terms, conditions, limitations and restrictions imposed by the state on the investment of public employee retirement systems. The board of trustees may employ investment counsel to advise the board in making and disposition of investments.

(b)

In exercising its discretionary authority with respect to the management of the monies and assets of the retirement system, the board of trustees shall exercise the care, skill, prudence, and diligence under the circumstances then prevailing, that an individual of prudence acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of like character and similar objectives.

(Code 1969, § 33.46)

(a)

All assets of the retirement system shall be held and invested for the sole purpose of meeting the legitimate obligations of the retirement system and shall be used for no other purpose.

(b)

Members of the board of trustees and its employees are prohibited from:

(1)

Having a beneficial interest, direct or indirect, in an investment of the retirement system.

(2)

Borrowing money or assets of the retirement system.

(3)

Receiving any pay or payment from any individual or organization providing services to the retirement system, other than compensation for personal services or reimbursement of authorized expenses paid by the retirement system.

(Code 1969, § 33.47)

The board of trustees shall not be paid for their service on the board of trustees except that they shall be reimbursed for the actual and necessary expenses incurred in performing their duties as trustees.

(Code 1969, § 33.48)

The board of trustees shall from time to time adopt such morality and other tables of experience, and a rate or rates of regular interest as are necessary in the operation of the retirement system on an actuarial basis.

(Code 1969, § 33.49)

The board of trustees shall correct errors in the records of the retirement system. The board of trustees may seek to recover overpayments after taking into consideration all of the facts and circumstances, and shall make up underpayments. Recovery of overpayments may be accomplished by reducing the amount of future payments so that the actuarial present value of actual payments to the recipient is equal to the actuarial present value of the payments to which the recipient was correctly entitled.

(Code 1969, § 33.58; Ord. of 12-19-2007)

(a)

The city will, to the fullest extent now or hereafter permitted by law, indemnify any trustee or officer of the city retirement system who was or is a party to, or threatened to be made a party to any threatened, pending, or completed action, suit or proceeding by reason of the fact that the person is or was a trustee or officer of the city retirement system, against expenses, including attorneys' fees, (which expenses may be paid by the city in advance of a final disposition of the action, suit or proceeding), judgments, penalties, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with the action, suit or proceeding if the person acted (or refrained from acting) in good faith and in a manner the person reasonably believed to be within the scope of his or her authority. The city may compromise, settle and pay the claim before or after the commencement of a civil action. Whenever a judgment for damages is awarded against a trustee or an officer of the city retirement system as a result of a civil action for damages caused by the trustee or officer while acting in good faith and within the scope of his or her authority, the city shall indemnify the trustee or officer or pay, settle, or compromise the judgment. When a criminal action is commenced against a trustee or officer of the city's retirement system based upon the conduct of the trustee or officer while acting on behalf of the city's retirement system, if the trustee or officer had a reasonable basis for believing that he or she was acting in good faith and within the scope of his or her authority at the time of the alleged conduct, the city shall pay for, engage or furnish the services of an attorney to advise the trustee or officer as to the action, and to appear for and represent the trustee or officer in the action.

(b)

The indemnification as set forth in subparagraph (a) of this section will continue as to a person who has ceased to be a trustee or officer of the city's retirement system. Any indemnification of a person who was entitled to indemnification after such person ceased to be a trustee or officer of the city's retirement system will inure to the benefit of the heirs and personal representatives of that person.

(Ord. of 5-24-2006)

Service rendered by a member shall be credited to the member's individual credited service account in accordance with rules the board of trustees shall prescribe. Service shall be credited to the nearest 1/12 year. The board of trustees may credit a member with a full year of credited service if the member has rendered at least ten months of service during the calendar year. In no case shall:

(1)

More than one year of credited service be credited on account of all service rendered by a member in any one calendar year.

(2)

Less than ten days of service in a calendar month be credited as a month of service.

(Code 1969, § 33.08)

Credited service shall be forfeited if an individual ceases to be a member and does not qualify as a vested former member. Credited service shall be forfeited if an individual, including a vested former member, receives a refund of accumulated member contributions.

(Code 1969, § 33.09)

A member may have forfeited credited service restored upon satisfaction of each of the following conditions:

(1)

The member returns to membership and the break in membership is less than four years.

(2)

The retirement system is paid the total amount of accumulated member contributions previously withdrawn by the member, if any, plus compound interest at the rate determined by the board of trustees from the date of withdrawal to the date of repayment.

(Code 1969, § 33.10)

A member who leaves the employ of the city to enter any armed service of the United States during any period of compulsory military service, or period of national emergency recognized by the city commission, or any period after January 18, 2006, shall be entitled to credited service for periods of required active duty, if each of the following conditions are satisfied:

(1)

The individual is re-employed by the city within one year after the date of termination of active duty; and

(2)

The individual becomes a member and pays the retirement system the total amount of accumulated member contributions previously withdrawn, if any, plus compound interest from the dates of withdrawal to the dates of repayment.

(Code 1969, § 33.11; Ord. of 12-10-2008)

(a)

The following benefit groups are designated for the purpose of determining retirement eligibility conditions, benefit amounts, and member contribution rates, as well as other nonuniform provisions.

(1)

Benefit group A (general). All members not included in another benefit group.

(2)

Benefit group B (electric union). All members employed by the city who are represented by IBEW Local #1392.

(3)

Reserved.

(4)

Benefit group D (dispatchers). All members employed as dispatchers in the city police department and the animal warden(s).

(5)

Benefit group E (police). All members employed in the classification of patrolman or of higher rank in the city police department.

(6)

Benefit group F (fire). All members employed in the classification of firefighter or of higher rank in the city fire department.

(b)

In case of doubt, the board of trustees shall determine the benefit group(s) that apply to a member.

(Code 1969, § 33.13; Ord. of 11-14-2012)

Benefit eligibility conditions shall be those applicable to the member's benefit group at time of termination of membership.

(Code 1969, § 33.14)

Pension amounts shall be separately determined for each benefit group for which the member has credited service, using retirement system provisions and the provisions of any applicable collective bargaining agreement in effect at the time of termination of membership, provided no accrued and vested benefits of members shall be diminished or decreased thereby. The amount of a pension under form of payment SL (section 2-187) is equal to the sum of separate amounts for each benefit group under which the retiring individual has credited service. The member's pension amount for each benefit group shall be based upon:

(1)

The member's final average compensation.

(2)

The member's credited service earned with the benefit group.

(3)

The benefit formula applicable to such benefit group as of the date of the member's termination of membership.

(Code 1969, § 33.15)

An individual may retire upon satisfaction of each of the following requirements:

(1)

A written application for retirement, in the form prescribed by the board of trustees, has been filed with the retirement system.

(2)

Employment is terminated immediately prior to the effective date of retirement, except that in the case of a vested former member, employment will have terminated at an earlier date.

(3)

The individual meets the applicable age and/or service requirements for retirement.

(Code 1969, § 33.16)

(a)

Benefit group A. In benefit group A the individual shall have attained age 60 years and has ten or more years of credited service; or has attained age 65 years and has five or more years of credited service; or has 25 or more years of credited service. For individuals who have not earned credited service prior to January 1, 2016, the individual shall have attained age 60 years and has ten or more years of credited service; or has attained age 65 years and has five or more years of credited service; or shall have attained age 55 years and has 25 or more years of credited service.

(b)

Benefit group B. In benefit group B the individual shall have attained age 60 years and has ten or more years of credited service; or has attained age 65 years and has five or more years of credited service; or has 25 or more years of credited service.

(c)

Reserved.

(d)

Benefit group D. In benefit group D the individual shall have attained age 55 years and has ten or more years of credited service; or has attained age 60 and has five or more years of credited service; or has 25 or more years of credited service and terminates city employment on or after April 1, 1995.

(e)

Benefit group E. In benefit group E the individual shall have attained age 55 years and has ten or more years of credited service; or has attained age 60 years and has five or more years of credited service; or has 25 or more years of credited service and terminates city employment on or after April 1, 1995.

(f)

Benefit group F. In benefit group F the individual shall have attained age 55 years and has ten or more years of credited service; or has attained age 60 years and has five or more years of credited service. Upon retirement as provided in this section a member shall be paid a pension computed according to the provisions of section 2-184.

(Code 1969, § 33.17; Ord. of 11-14-2012; Ord. of 12-21-2015)

(a)

A vested former member may retire upon satisfying the age and service requirements specified for the member's benefit group:

(1)

Benefit groups A, B and D. In benefit groups A, B and D the vested former member has attained age 60 years and has ten or more years of credited service.

(2)

Reserved.

(3)

Benefit groups E and F. In benefit groups E and F the vested former member has attained age 55 years and has ten or more years of credited service.

(b)

Withdrawal of accumulated member contributions and loss of credited service shall constitute forfeiture of all rights to any pension provided by the retirement system.

(c)

Upon retirement as provided in this section a vested terminated member shall be paid a pension computed according to the provisions of section 2-187 or corresponding section of the retirement ordinance in effect on the date the member ceased to be an employee.

(Code 1969, § 33.18; Ord. of 11-14-2012)

The annual benefit amount under form of payment SL (Straight Life) is determined as follows:

(1)

Benefit group A. Years and fraction of a year of credited service multiplied by the sum of 1.2 percent of the $4,200.00 of final average compensation and 1.7 percent of final average compensation in excess of $4,200.00.

(2)

Benefit group B. Years and fraction of a year credited service multiplied by 2.0 percent of final average compensation.

(3)

Benefit group D.

a.

For payments before the retired member's 62nd birthday if city employment was terminated on or after April 1, 1995, years and fraction of a year of credited service multiplied by 2.5 percent of the member's final average compensation, and

b.

For payments after the retired member's 62nd birthday, or regardless of age if city employment was terminated before April 1, 1995, years and fraction of a year of credited service multiplied by the sum of 1.2 percent of the first $4,200.00 of final average compensation and 1.7 percent of final average compensation in excess of $4,200.00.

(4)

Benefit groups E and F. Years and fraction of a year of credited service multiplied by 2.5 percent of final average compensation.

(Code 1969, § 33.19; Ord. of 7-9-2003, § 33.19; Ord. of 11-14-2012)

(a)

All retirees who were receiving retirement benefits from the employee retirement system on or before December 31, 1985, shall receive a one-time increase in their original retirement allowance of two percent for each year that retirement benefits have been received from January 1, 1969 to December 31, 1989, not to exceed a total increase of 40 percent.

(Example: A retiree who retired in 1984 and whose original retirement allowance was $100.00 per month would receive a $10.00 per month increase, i.e., two percent for each year multiplied by five years = ten percent multiplied by $100.00 per month original retirement allowance = $10.00.)

However, no city retiree shall receive a monthly retirement benefit of less than $100.00 per month.

(b)

All benefit group A retirees who were receiving retirement benefits on or before December 31, 1985. shall receive a one-time increase in their current retirement allowance of 9.1 percent retroactive to October, 1995.

(Code 1969, § 33.19a)

(a)

If a retired member becomes employed by the city, the following rules shall apply:

(1)

The retired member's pension payments will be suspended effective as of the first of the month following the retired member's rehire date.

(2)

The retired member's pension payments will be reinstated as of the first of the month following termination of the retired member's reemployment.

(3)

The amount of the reinstated pension shall be the amount the retired member would have received had the retired member not become reemployed by the city.

(b)

Subsections (a)(1), (2) and (3) shall not apply and pension payments shall continue without change due to reemployment by the city if the retired member is not included as a member of the retirement system during the period of reemployment, and one or more of the following applies:

(1)

The retired member is employed by the city for not more than 1,000 hours in any 12-month period.

(2)

The retired member is elected or appointed as a city official to an office that the retired member did not hold just prior to retirement for a term of office that begins after the member's retirement date, or to the same office that the retired member held just prior to retirement for a term of office that begins at least two years after the member's retirement date.

(Code 1969, § 33.20)

A member or vested former member may elect to have pension payments made under any one of the following forms of payment, except that forms of payment 4 and 5 may be elected only by an individual from benefit group A or B. The election and naming of a survivor beneficiary must be made on a form furnished by and filed with the retirement system prior to the date the first pension payment is made. An election of form of payment may not be changed on or after the date the first pension payment is made. A named survivor beneficiary may not be changed on or after the date the first pension payment is made if form of payment 2 or 3 is elected. A named survivor beneficiary may be changed or may be more than one person only if form of payment SL or 1 is elected. A named survivor beneficiary must have an insurable interest in the life of the member or vested former member when named, unless the survivor beneficiary is named under form of payment SL or form of payment 1. Payment shall be made tinder form of payment SL if there is not a timely election of another form of payment. The amount of pension under forms of payment 1 through 5 shall have the same actuarial present value, computed as of the effective date of the pension, as the amount of pension under form of payment SL.

(1)

Form of payment SL, straight life pension. The retired member is paid a pension for life under form of payment SL. Upon the death of the retired member, no further pension benefits will be provided.

(2)

Form of payment I, life payments with ten years certain. The retired member is paid a reduced pension for life under form of payment 1. Upon the death of the retired member, if the retired member received fewer than 120 monthly pension payments, the named survivor beneficiary is paid a pension for the remainder of the 120 months in the same amount the retired member was receiving. If the named beneficiary has died before the retired member, or dies before 120 months has elapsed, the remaining monthly payments shall be paid to the estate of the last remaining of the retired member and the named survivor beneficiary.

(3)

Form of payment 2, life payments with full continuation to survivor beneficiary. The retired member is paid a reduced pension for life under form of payment 2. Upon the death of the retired member during the lifetime of the named survivor beneficiary, the named survivor beneficiary is paid a pension until death in the same amount the retired member was receiving.

(4)

Form of payment 3, life payments with one-half continuation to survivor beneficiary. The retired member is paid a reduced pension for life under form of payment 3. Upon the death of the retired member during the lifetime of the named survivor beneficiary, the named survivor beneficiary is paid a pension until death of one-half the amount the retired member was receiving.

(5)

Form of payment 4, life payments with full continuation to survivor beneficiary and increase for retired member upon death of beneficiary. The retired member is paid a reduced pension for life under form of payment 4. Upon the death of the retired member, the named survivor beneficiary is paid a pension until death in the same amount the retired member was receiving. Should the named survivor beneficiary die before the retired member, the retired member's pension shall be recomputed (pop-up) to a straight life pension (form of payment SL).

(6)

Form of payment 5, life payments with one-half continuation to survivor beneficiary and increase for retired member upon death of beneficiary. The retired member is paid a reduced pension for life under form of payment 5. Upon the death of the retired member, the named survivor beneficiary is paid a pension until death of one-half the amount the retired member was receiving. Should the named survivor beneficiary die before the retired member, the retired member's pension shall be recomputed (pop-up) to a straight life pension (form of payment).

(Code 1969, § 33.21)

(a)

The board of trustees may approve disability retirement for a member who becomes incapacitated for continued employment by the city if each of the following conditions are met:

(1)

Application for disability retirement is filed with the board of trustees by either the member or the city, while the member is in the employment of the city;

(2)

The member has ten or more years of credited service;

(3)

The member undergoes all medical examinations and tests ordered by the board of trustees, and releases to the board of trustees all requested medical reports and records;

(4)

The member's doctor certifies to the board of trustees that (i) the member is totally incapacitated mentally or physically totally incapacitated for any continued employment by the city, (ii) the incapacity is likely to be permanent, and (iii) the member should be retired;

(5)

The board of trustees concurs with the certification of the member's doctor.

(b)

The effective date of a disability retirement shall not predate the later of (i) the date of disability and (ii) the date the member ceases to be paid by the city.

(Code 1969, § 33.22)

The amount of a disability pension shall be computed according to section 2-184 based upon the member's credited service and compensation history until termination of city employment. The disability retired member shall have the right to elect a form of payment provided in section 2-187.

(Code 1969, § 33.23)

The following exceptions to the provisions of sections 2-206 and 2-207 shall apply if the board of trustees finds that the member's disability is the direct and proximate result of the member's employment by the city and if the member is in receipt of worker's compensation on account of the disability arising out of and in the course of city employment:

(1)

The requirement of ten years of credited service shall be waived.

(2)

The disability pension shall not be less than 17 percent of the member's final average compensation.

(3)

Upon attainment of age 65 years or termination of the statutory period for worker's compensation benefits, the disability pension shall be recomputed with the member's credited service incremented by the years and fraction of a year, if any, from the effective date of the disability pension to the date of recomputation.

(Code 1969, § 33.24)

(a)

The straight life amount of a disability pension shall not exceed the difference between the disability retired member's final average compensation and the amount of the disability retired member's considered income.

(b)

A disability retired member's considered income is the annualized sum of the following amounts:

(1)

Remuneration for personal services rendered in any gainful employment.

(2)

Worker's compensation weekly benefits, redemptions, and settlements, on account of the same disability for which retired. If there is a redemption or settlement of the worker's compensation benefit, weekly benefits at the established amount shall be considered to continue until the weekly benefits paid after the effective date of the settlement equal the amount of the redemption or settlement. Thereafter, the member will be considered to have no income from worker's compensation benefits. Worker's compensation benefits for bona fide medical expenses, as determined by the board of trustees, shall not be considered income.

(3)

Payments from any program of salary continuance, sickness and accident insurance, disability benefits, or program of similar purpose, financed in whole or in part by the city. Cost-of-living increases in the amount of disability benefits paid the retired member under the federal Social Security program shall be disregarded. The retirement system shall calculate the initial amount of disability pension on the premise that the retired member is being paid federal Social Security disability benefits for a single person with average monthly earnings equal to the retired member's final average compensation. The retired member may submit evidence, satisfactory to the retirement system, of receipt of a lesser amount of Social Security disability pension or denial of a Social Security disability pension and the amount of pension shall be recalculated taking the lesser amount or denial into account.

(4)

Unemployment insurance or similar payments by reason of the member's city employment.

(c)

The retirement system shall periodically request substantiated income information from retired member. Failure to provide the requested information within 90 days of the request shall cause suspension of payment of the pension until the information is received.

(d)

The provisions of this section shall apply during the period, if any, between the effective date of a disability pension and the date the disability retired member attains age 65 years. Application of the limitation shall be to the amount of pension under form of payment SL. The effect of an election of any other form of payment shall be taken into account after application of the provisions of this section.

(Code 1969, § 33.25)

(a)

At least once each year during the first five years following a member's retirement for disability and at least once in every three-year period thereafter, the board of trustees shall require a disability retired member to undergo periodic medical or other reevaluation if the individual has not attained age 60 years. If the disability retired member refuses to submit to reevaluation, payment of the pension may be suspended by the board of trustees. If the refusal continues for one year, the board of trustees may revoke the disability retired member's rights to the disability pension. A disability pension shall be terminated if the medical director reports that the disability retired member is no longer mentally or physically totally incapacitated for any continued employment by the city and the board of trustees concurs with the report.

(b)

The membership status of a terminated disability retired member who is returned to city employment shall be governed by the provisions of sections 2-84 and 2-85. Actual credited service at time of disability retirement shall be restored upon again acquiring membership. Credited service shall not be granted for the period of disability retirement unless the member was in receipt of worker's compensation on account of a disability arising out of and in the course of city employment.

(c)

A terminated disability retired member who does not reacquire membership and restoration of credited service shall have actual credited service at time of disability retirement restored if such restoration enables the individual to become a vested former member.

(Code 1969, § 33.26)

A pension shall be paid for life to the surviving spouse of a deceased member if each of the following conditions are met:

(1)

The member has ten or more years of credited service.

(2)

The member was married to the surviving spouse at time of death.

(3)

The member died while an employee of the city.

(4)

No eligible domestic relations court orders to the contrary are in effect.

(Code 1969, § 33.27)

The amount of an automatic pension payable to the spouse shall be computed as if the deceased member had retired the day preceding death under the normal retirement provisions (section 2-184), elected form of payment 2 and nominated such spouse as beneficiary (section 2-187). Upon the death of the spouse, the pension shall terminate.

(Code 1969, § 33.28)

(a)

A member may name a contingent survivor beneficiary for the exclusive purpose of being paid a pension under the provisions of this section. The naming of a contingent survivor beneficiary shall be made on a form provided by and filed with the board of trustees. The named contingent survivor beneficiary may be changed or the election revoked at any time prior to the member's retirement or death.

(b)

A pension shall be paid to the named contingent survivor beneficiary, if each of the following conditions are met:

(1)

The member dies while an employee of the city at a time when the named contingent beneficiary is alive.

(2)

The member, at time of death, had ten or more years of credited service.

(3)

The named contingent survivor beneficiary is found by the board of trustees to have been dependent upon the deceased member for at least 50 percent of the individual's financial support.

(Code 1969, § 33.29)

The amount of pension paid to the named beneficiary shall be computed as if the deceased member had retired the day preceding death under the normal retirement provisions (section 2-184), elected form of payment 2, and elected the named beneficiary as survivor beneficiary (section 2-187). The pension shall terminate upon the death of the named beneficiary.

(Code 1969, § 33.30)

In the event:

(1)

A member dies while an employee of the city, or

(2)

A disability retired member dies within five years of the date of retirement as a result of the same injury or disease for which the member retired and for which the member was paid a worker's compensation benefit; and

(3)

The injury or disease resulting in death is found by the board of trustees to have occurred as the direct and proximate result of causes arising out of the course of the member's actual performance of duties in the employ of the city, and

(4)

Eligible beneficiaries are paid worker's compensation benefits on account of the death, the following provisions shall apply in lieu of sections 2-226 through 2-229;

(5)

If the member had not retired, the accumulated member contributions shall be refunded in accordance with section 2-272;

(6)

The surviving spouse of the deceased member or retired member shall receive a monthly pension equal to the spouse's weekly worker's compensation converted to a monthly basis. The spouse's pension shall begin upon termination of the worker's compensation payments and shall continue until the earlier of the spouse's remarriage or death. While the surviving spouse is in receipt of worker's compensation payments, the surviving spouse shall receive a monthly pension equal to the difference, if any, converted to a monthly basis between 60 percent of the member's final average compensation and the surviving spouse's worker's compensation payments converted to an annual basis. As used in this section, the term spouse means the person to whom the member or retired member was married at the time the member's or retired member's last employment with the city was terminated, and at the date of death;

(7)

If the deceased member or retired member leaves an unmarried child or children under age 18 years, each such child shall receive a monthly pension equal to the child's weekly worker's compensation converted to a monthly basis. The child's pension shall begin upon termination of the worker's compensation payments and shall continue until the earliest of the child's marriage, attainment of age 18 years, adoption or death. If a surviving spouse's pension is terminated, each child's pension shall be increased by an equal share of the surviving spouse's pension;

(8)

The deceased member's or retired member's dependent parents shall each receive a pension equal to such parent's weekly worker's compensation converted to a monthly basis. The parent's pension shall begin upon termination of the parent's worker's compensation payments and shall continue until death;

(9)

If there is a redemption or settlement of the worker's compensation payments referred to in subsections (6), (7) or (8) of this section, weekly benefits at the established amount shall be considered to continue until the weekly benefits paid after the effective date of the redemption or settlement equal the amount of the redemption or settlement. Thereafter, the worker's compensation payments will be considered to have terminated.

(10)

In no case shall the sum of the annual benefits provided in subsections (6), (7) and (8) of this section exceed the deceased member's or retired member's final average compensation. If adjustment is necessary to meet this limitation, each of the benefits under subsections (6), (7) and (8) of this section shall be reduced proportionately.

(Code 1969, § 33.31)

No pension payments shall be made under the provisions of sections 2-226 and 2-227 if any pension is or will be paid under the provisions of sections 2-228 and 2-229. No pension payments shall be made under the provisions of sections 2-226, 2-227, 2-228 and 2-229 if any pension is or will be paid under the provisions of section 2-230.

(Code 1969, § 33.32)

If all pension payments permanently terminate before the total payments from the system on behalf of the former member equal the retired member's, deceased member's, or deceased vested former member's accumulated member contributions at time of retirement or death if earlier, the difference between the amount of accumulated member contributions at time of retirement or death if earlier and the aggregate amount of pension payments made shall be paid to such individual or individuals as the former member may have named on a form provided by and filed with the board of trustees. If no such named individual survives, the difference shall be paid to the legal representative of the last to survive of the former member and named individuals.

(Code 1969, § 33.33)

The date of a member's retirement shall not be less than 30 days nor more than 90 days after the member files a written application for retirement with the board of trustees.

(Code 1969, § 33.34)

A benefit claimant shall be notified in writing within 30 days of a denial of a claim for benefits. The notification shall contain the basis for denial. The benefit claimant may appeal the denial and request a hearing before the board of trustees. The appeal shall be in writing and filed with the board of trustees within 90 days of the date of the notification of denial. The request for appeal shall contain a statement of the claimant's reasons for believing the denial to be improper. The board of trustees shall schedule a hearing of the appeal within 60 days of receipt of the request for appeal.

(Code 1969, § 33.35)

State Law reference— Public Employee Retirement Benefits Forfeiture Act, MCL 38.2701 et seq.

All payments from the retirement system shall be made by the city clerk-treasurer according to city procedures governing disbursement of general fund monies. Checks shall be signed by the city clerk-treasurer and the mayor. Payments shall only be executed based upon a specific or continuing resolution adopted by the board of trustees. Authorization of the city commission shall not be required for making such payments.

(Code 1969, § 33.36)

(a)

A normal or disability pension shall commence on the member's or vested former member's date of retirement. A pre-retirement survivor pension shall commence on the first day following the death of the member. A post-retirement survivor pension shall commence on the first day following the termination of the retired member's pension.

(b)

Pensions are paid in 12 equal installments. The mailing date for pensions is the 15th day of each calendar month.

(c)

The first payment of a pension shall be made on the mailing date coincident with or next following the commencement date.

(d)

The last payment of a pension shall be made on the last mailing date preceding the event causing termination.

(e)

A change in the amount of a pension shall be made on the mailing date next following the date of the event causing the change.

(Code 1969, § 33.37)

(a)

Member contributions to the retirement system shall be deducted from each member's paychecks and shall be the percentages of the member's annual compensation as set by the city and communicated to the members.

(b)

Continuation of employment by the member shall constitute consent and agreement to the deduction of the member contributions where applicable. Payment of compensation less the deduction shall be full and complete discharge of all claims and demands for compensation for personal service rendered the city.

(c)

The person responsible for preparing the city payroll shall cause the member contributions to be deducted from the compensation of each member on each and every payroll. The deducted contributions shall be paid to the retirement system and shall be credited to the member's individual accounts in the reserve for member contributions.

(Code 1969, § 33.38; Ord. of 12-10-2008; Ord. of 11-14-2012)

(a)

An individual's accumulated member contributions shall be refunded to the individual if all of the following conditions are met:

(1)

Membership in the retirement system has been terminated.

(2)

The individual has not met the applicable age and service conditions for normal retirement (section 2-182).

(3)

A disability pension (sections 2-206 through 2-208) is not payable or being paid to the individual;

(4)

A nonduty survivor pension (sections 2-226 through 2-229) is not payable or being paid on the individual's behalf.

(5)

The individual makes application for the refund on a form provided by and filed with the board of trustees.

(b)

If an individual dies and no pension becomes or will become payable on account of the death, the individual's accumulated member contributions shall be refunded in accordance with the deceased individual's instructions made on a form provided by and filed with the board of trustees. If there be no such instructions or if the individuals who are to be paid the refund no longer live, the accumulated member contributions shall be refunded to the legal representative of the deceased individual. If no legal representative can be located, and if the individual's estate is insufficient to cover reasonable burial expenses, the member's accumulated contributions may be used to pay such reasonable burial expenses.

(c)

Refunds of accumulated contributions, as provided for in this division, may be made in monthly installments according to such rules and regulations as the board of trustees shall from time to time adopt.

(Code 1969, § 33.39)

(a)

The financial objective of this division is to provide for city contributions to the retirement system each fiscal year.

(1)

Which together with the contributions made by members during the fiscal year, if any, shall be sufficient to fully fund the cost of benefits likely to be paid on account of service rendered by members during the year, finance unfunded costs of benefits likely to be paid on account of service rendered by members prior to the current year over a period of not more than 40 years, and pay retirement system administrative expenses; and

(2)

Which expressed as percents of the aggregate annual compensation of members will remain approximately level from generation to generation of city taxpayers.

(b)

City contribution amounts required to meet the financial objective shall be determined by annual actuarial valuations made in accordance with generally accepted actuarial principles and in conformance with any applicable laws. The board of trustees shall certify to the city commission the amount of annual contribution needed to meet the financial objective and the city commission shall appropriate and cause the contribution to be paid to the retirement system.

(Code 1969, § 33.50)

Charter reference— Similar provisions, ch. XXX, § 3.

(a)

The reserve for accumulated member contributions is the account in which is accumulated the contributions deducted from the compensation of members, or otherwise paid to the retirement system by the member, and which shall be charged with refunds and transfers of accumulated member contributions.

(b)

A member's accumulated contributions shall be transferred from the reserve for accumulated member contributions to the reserve for pension payments if a pension becomes payable on account of the member's retirement or death.

(c)

A member's accumulated contributions shall be transferred from the reserve for accumulated member contributions to the reserve for undistributed investment income if a member who is not a vested former member is entitled to a refund of member contributions under section 2-272 and does not apply for a refund within three years of the member's date of termination of membership in the retirement system.

(Code 1969, § 33.51)

(a)

The reserve for pension payments is the account which is charged with all pension payments and refunds of accumulated member contributions which have been transferred to this account. If a disability pension is terminated and the individual again becomes a member or becomes a vested former member, the pension reserve at the date of termination of disability shall be transferred from the reserve for pension payments to the reserve for member contributions and the reserve for employer contributions in the proportion transfers were made from such accounts because of the retirement.

(b)

Each year following receipt of the report of the annual actuarial valuation, the balance in the reserve for pension payments shall be set equal to the actuarial present value of pensions being paid retired members and beneficiaries by a transfer to or from the reserve for employer contributions. The pending transfer shall be taken into account by the actuary when making the actuarial valuation.

(Code 1969, § 33.52)

The reserve for employer contributions is the account to which is credited city contributions and from which shall be made transfers to the reserve for pension payments. If a pension becomes payable on account of a member's retirement or death, the difference between (i) the present value of the expected payments on behalf of the member and (ii) the amount transferred from the reserve for accumulated member contributions on behalf of the member shall be transferred from the reserve for employer contributions to the reserve for pension payments.

(Code 1969, § 33.53)

The descriptions of the reserve accounts shall be interpreted to refer to the account records of the retirement system and not to the physical separation or investment of assets by reserve account.

(Code 1969, § 33.54)

(a)

The board of trustees shall every second week credit interest on the individual beginning of year balances in the reserve for accumulated member contributions. The board of trustees shall at the end of each fiscal year credit interest on the mean balance in the reserve for pension payments and the reserve for employer contributions.

(b)

The interest rate to be used for the crediting of interest will be three percent.

(Code 1969, § 33.55; Ord. of 12-10-2008)