City of Grand Ledge, MI
Eaton County
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Table of Contents
Table of Contents
[HISTORY: Adopted by the City Council of the City of Grand Ledge as indicated in article histories. Amendments noted where applicable.]
GENERAL REFERENCES
Sewers — See Ch. 167.
Stormwater improvements — See Ch. 175.
Water — See Ch. 210.
214a Appendix A
[Adopted 5-27-1968 by Ord. No. 177]

§ 214-1 Combination of system.

The Water Supply and Sewage Disposal System of the City of Grand Ledge shall be operated and maintained as one system on a combined rate basis and said system shall include all wells, pumps, pump houses, water mains and laterals, water and sewer pumping stations, water storage and treatment facilities, sewers, force main and lift stations, sewage treatment facilities and all attendant facilities and equipment which are used or useful in the operation and maintenance of the Water Supply and Sewage Disposal System, now in existence or hereafter acquired.

§ 214-2 Necessity and description of public improvements.

It is hereby determined to be necessary for the public health, safety and welfare of the City of Grand Ledge (hereinafter sometimes called "City"), to acquire and construct, in accordance with detailed maps, plans and specification therefor prepared by Fishbeck and Thompson, Inc., consulting engineers of Lansing, Michigan, improvements to the system consisting of an elevated water storage tank, water river crossing and connections, a new well, trunk and lateral sanitary sewers, a sewer river crossing and a pumping station, together with necessary appurtenances and attachments.

§ 214-3 Cost.

The cost of said public improvements has been estimated by said engineer to be $1,050,000, including the payment of incidental expenses as specified in § 214-4 of this article, which estimate of cost if hereby approved and confirmed, and the period of usefulness of said public improvements is estimated to be not less than 40 years.

§ 214-4 Bonds authorized.

A. 
To pay part of the cost of acquiring and constructing said public improvements, including the payment of legal, financial and other expenses incident thereto and incident to the issuance and sale of the bonds, it is hereby determined that the City shall borrow the sum of $930,000, and that revenue bonds be issued therefor pursuant to the provisions of Act 94, Public Acts of Michigan, 1933, as amended, which bonds are referred to in this article as "the bonds." The balance of the cost shall be paid from special assessments and other funds of the City available therefor.
B. 
Whenever the words "the system" are referred to in this article, they shall be understood to mean the complete water supply and sewage disposal system of the City, including all wells, pumps, pumphouses, water mains, storage facilities, treatment facilities, and all other facilities used or useful in the supply and distribution of water for domestic, commercial or industrial uses and for fire protection purposes, and all sewers, sewer pumping stations, sewage treatment facilities and all other facilities used or useful in the collection, treatment and disposal of sanitary wastes, including all appurtenances thereto now owned by the City, acquired pursuant to this article and all extensions and improvements thereto hereafter made.
C. 
Whenever the words "public improvements" are used in this article, they shall be understood to mean the improvements authorized to be acquired and constructed under the provisions of this article.
D. 
Whenever the words "revenues" and "net revenues" are used in this article, they shall be understood to have the meanings as defined in Section 3, Act 94, Public Acts of Michigan, 1933, as amended.

§ 214-5 Details of bonds.

A. 
Said bonds shall be designated "Water Supply and Sewage Disposal System Revenue Bonds," and shall be not general obligations of the City, but revenue bonds payable out of the net revenues of the system after provision has been made for the payment of expenses of administration, operation and maintenance and shall consist of 186 bonds of the denomination of $5,000 each, dated as of July 1, 1968, numbered in direct order of maturity from one upwards, and maturing as follows:
(1) 
Fifteen thousand dollars July 1 of each year from 1970 to 1972, inclusive;
(2) 
Twenty thousand dollars July 1 of each year from 1973 to 1976, inclusive;
(3) 
Twenty-five thousand dollars July 1 of each year from 1977 to 1980, inclusive;
(4) 
Thirty thousand dollars July 1 of each year from 1981 to 1983, inclusive;
(5) 
Thirty-five thousand dollars July 1 of each year from 1984 to 1986, inclusive;
(6) 
Forty thousand dollars July 1 of each of the years 1987 and 1988;
(7) 
Forty-five thousand dollars July 1, 1989;
(8) 
Fifty thousand dollars July 1 of each of the years 1990 to 1992, inclusive;
(9) 
Fifty thousand dollars July 1, 1993;
(10) 
Sixty thousand dollars July 1 of each of the years 1994 to 1996, inclusive.
B. 
Said bonds to bear interest at a rate or rates not exceeding 6% per annum, payable on January 1, 1969, and semiannually thereafter on July 1 and January 1 of each year, both principal and interest to be payable in lawful money of the United States of America at a bank or trust company to be designated by the purchaser of the bonds.
C. 
Bonds maturing in the years 1970 to 1983, inclusive, will not be subject to prior redemption.
D. 
Bonds maturing in the years 1984 to 1996, inclusive, will be subject to redemption prior to maturity, at the option of the City, in inverse numerical order on any interest payment date on or after July 1, 1983.
E. 
Bonds called for redemption shall be redeemed at par and accrued interest to the date fixed for redemption, plus a premium as follows:
(1) 
Four percent of par value on each bond called for redemption prior to July 1, 1986;
(2) 
Three percent of par value on each bond called for redemption on or after July 1, 1986, but prior to July 1, 1989;
(3) 
Two percent of par value on each bond called for redemption on or after July 1, 1989, but prior to July 1, 1992;
(4) 
One percent of par value on each bond called for redemption on or after July 1, 1992, but prior to maturity.
F. 
Thirty-days' notice of the call of any bonds for redemption shall be given by publication in a paper circulated in the State of Michigan which carries, as part of its regular service, notices of sale of municipal bonds. Bonds so called for redemption shall not bear interest after the date fixed for redemption, provided that funds are on hand with the paying agent to redeem said bonds.
G. 
Said bonds shall be signed by the Mayor and countersigned by the City Clerk and shall have the corporate seal of the City impressed thereon, and shall have interest coupons attached bearing the facsimile signature of its City Treasurer. Said bonds shall be delivered by the City Treasurer upon payment of the purchase price therefor.

§ 214-6 Creation of lien.

Said bonds and the attached coupons shall not be a general obligation or indebtedness of the City, but shall be payable solely from the net revenues derived from the operation of the system, and to secure such payment there is hereby created a statutory first lien upon the whole of the net revenues of said system, to continue until the payment in full of the principal and interest on said bonds.

§ 214-7 Remedies of bondholders.

A. 
The holder or holders of said bonds or coupons representing in the aggregate not less than 20% of the entire issue then outstanding may, by suit, action, mandamus or other proceedings, protect and enforce the statutory lien upon the revenues of said system and may be suit, action, mandamus or other proceedings, enforce and compel performance of all duties of the officers of the City, including the fixing of sufficient rates, the collection of revenues, the proper segregation of the revenues of the system and the proper application thereof; provided, however, that the statutory lien upon said revenues shall not be construed as to compel the sale of the system.
B. 
If there be any default in the payment of the principal of or interest upon any of said bonds, any court having jurisdiction on any proper action may appoint a receiver to administer and operate said system on behalf of the City, and under the direction of said court, and by and with the approval of said court to perform all of the duties of the officials of said City, more particularly set forth herein and in Act 94, Public Acts of Michigan, 1933, as amended.
C. 
The holder or holders of any such bonds or coupons therefrom shall have all other rights and remedies given by said Act 94, Public Acts of Michigan, 1933, as amended, for the collection and enforcement of said bonds and the security therefor.

§ 214-8 Management of system.

The construction, alteration, repair and management of the system shall be under the supervision and control of the City Council. The City may employ such person or persons, boards or commissions, in such capacity or capacities as it deems advisable to carry on the efficient management and operation of the system. The City Council may make such rules, orders and regulations as it deems advisable and necessary to assure the efficient management and operation of the system.

§ 214-9 Rates.

[Amended 3-27-1979 by Ord. No. 269; 7-13-1981 by Ord. No. 296; 7-9-1990 by Ord. No. 392; 4-8-1991 by Ord. No. 407; 3-23-1992 by Ord. No. 428; 8-13-2001 by Ord. No. 469; 8-12-2002 by Ord. No. 482; 4-26-2004 by Ord. No. 493]
The rates to be charged for water and sewer services and the procedures for collection thereof shall be as follows:
A. 
Water rates.
(1) 
Water rates shall be as follows:
(a) 
For the first 10,000 gallons: $1.30 per 1,000 gallons.
(b) 
For all gallons exceeding 10,000 gallons: $2.57 per 1,000 gallons.
(2) 
In addition to the minimum quantity charge, a debt service charge shall be assessed at the rate of $22.31 per equivalent meter. An "equivalent meter" shall be defined as a factor which equals the proportion of the flow ratio of a water meter of a given size to a standard water meter of 5/8 inch to 3/4 inch, with the flow ratio of meter sizes to be established as follows:
Meter Size
(inches)
Flow Ratio
5/8 to 3/4
1.0
1
2.5
1 1/2
5.0
2
8.0
3
16.0
4
25.0
6
50.0
8
110.0
10
170.0
12
250.0
16
450.0
B. 
Sewer rates. Sewage disposal charges shall be $3.41 per 1,000 gallons based on water meter reading for the same premises for the same period of time. The fixed rate per customer per quarter shall be $3.88.
C. 
Special rates and charges. Rates for related water and sewer services not established in this article shall be as from time to time established by resolution of the Grand Ledge City Council.
D. 
Rate changes. Water and sanitary sewer rates, charges, fees and deposits established in this Code may be amended from time to time by resolution of the City Council.
E. 
Billing; service charge; deposits; liens on property; and budget billing.
(1) 
Except as expressly provided herein, billing for sewer and water service shall be made and collected quarterly. Except as provided below for budget customers, all bills for sanitary sewer and water service shall be due and payable at the office of the City Treasurer on or before the 25th day of the month in which the bills are rendered. Failure to pay bills when due shall result in the addition of a service fee of 10%.
(2) 
The property owner/landlord shall be responsible for all water and sanitary sewer service furnished to the owner/landlord's property. Charges for service furnished to the premises shall be a lien on said premises and charges delinquent for six months or more shall be certified only to the City Treasurer and Assessor who shall enter the lien on the next tax roll against said premises. All charges shall be collected and the lien enforced in the same manner as provided for the collection of taxes assessed upon the roll and the enforcement of the lien for taxes. The Utility Billing Clerk shall be and is hereby required to certify said delinquencies by filing a written statement in the amount of the delinquency to the City Treasurer and Assessor. The foregoing notwithstanding, delinquent charges shall not become a lien against the property if the landlord has provided written notice to the Utility Billing Clerk that a tenant is responsible for such charges and provides a copy of the lease, if there is one. Upon receipt of such notice, the City shall provide no further water or sewer service to the premises until a cash deposit is made as required herein as security for payment of such charges. In addition to other lawful collection and enforcement methods, the collection of charges may be enforced by termination of all such service. In addition, no such notice as provided herein shall be deemed to shift responsibility or remove responsibility for payment from the owner/landlord to a tenant or tenants unless the property owner/landlord has provided an individual water meter and water shutoff device for each tenant's portion of the premises. In addition to other remedies provided, the City shall have the right to shut off and discontinue the supply of water to any premises for the nonpayment of water and sewer rates when due. In the event water and sewer charges for services furnished to any premises are not paid within 30 days after the due date thereof, water service shall not be restored until all such charges, service fees and other applicable charges shall have been paid in full. A service restoration fee in the amount of $50 shall be charged for restoration of service during normal business hours, i.e., 8:30 a.m. to 5:00 p.m., Monday through Friday, and $100 at other times. Weekend restoration service will not occur unless all required fees, charges and deposits are paid not later than 5:00 p.m., Friday.
(3) 
A deposit shall be paid by all tenants and existing water/sewer customers whose service has been terminated for nonpayment in the amount of $100. Said deposit shall be refunded to the payor after the account has been active for 12 months without delinquency. A deposit shall also be required for nonresidential water customers in the amount of $250, multiplied by the flow ratio set forth in § 214-9A(2) or $1,500, whichever is less. Once service has been discontinued for nonpayment, service shall not be restored until all delinquencies, charges and deposits are paid in full.
[Amended 7-24-2006 by Ord. No. 511]
(4) 
All new multiple-residential structures and conversions to multiple-residential structures and all other new or converted structures having multiple water/sewer customers shall contain plumbing for separate water meters and water shutoff devices for each user unit.
(5) 
When a meter reading cannot be obtained for any reason, the City shall estimate the usage based on previous consumption patterns of the same or similar premises, and the water billing shall be based upon that estimate, subject to later adjustment if a reading is subsequently obtained.
(6) 
Notwithstanding the provision for quarterly billing described in Subsection E(1) above:
(a) 
Customers with an average quarterly consumption (over three months) of 30,000 gallons per month may be subject to monthly meter readings and may be billed monthly, in the discretion of the Director of the Public Service Department or said Director's designee.
(b) 
Customers who have qualified for and requested a budget billing payment plan will receive a monthly budget bill based upon the monthly average of the previous year's usage. The City will, however, continue to read meters quarterly, and the account will be audited annually. If the actual usage is determined to be below the average billed, a credit will be given and the budget bill will, for the next succeeding year, be adjusted downward to reflect the actual usage. Conversely, if the usage, as metered, exceeds the amount billed, the unpaid balance will be billed in the first regular billing beginning in July of each year. The succeeding year's budget bill will then be adjusted upward to reflect the additional average usage.
[1] 
To be eligible for budget billing, a customer shall have been a water customer for at least one year and shall complete the application form supplied by the City in full.
[2] 
Budget billing customers will lose the budget billing privilege if they are delinquent in payment of their account for more than 10 days after the monthly bill is due. All budget billing accounts will be billed on the first day of the month, with accounts due and payable not later than the 25th day of each month.
[3] 
Selection of the budget billing option shall result in an additional administrative charge of $2 per month, or such other charge as may be established from time to time by resolution of the City Council.
(7) 
Miscellaneous charges. There is hereby established a new account fee in the amount of $10 and a seasonal turnoff/turn-on charge of $10 for each procedure. In addition, a charge equal to the cost of labor and equipment to replace any water system apparatus, including meters and reading devices that are damaged or destroyed as a result of the intentional misconduct or negligence of the customer or its tenants, is hereby established.
F. 
Sewer separation fee.
(1) 
Any user proposing to hook into the sewer system shall pay a sewer separation fee in the amount as set from time to time by resolution adopted by the City Council for each residential equivalent of service to be provided, the sewer separation fee to be payable as follows:
(a) 
Where the parcel to be served does not require site plan approval under Chapter 220, Zoning, or plat approval under Chapter 182, Subdivision of Land, or approval under the provisions of Act 98 of the Michigan Public Acts of 1913, as amended, and less than 20 residential equivalents of service will be required, payment shall be made prior to hookup to the system.
(b) 
Where the parcel to be served does not require site plan approval under Chapter 220, Zoning, or plat approval under Chapter 182, Subdivision of Land, or approval under the provisions of Act 98 of the Michigan Public Acts of 1913, as amended, and more than 20 residential equivalents of service will be required, payment for the first 20 residential equivalents of service shall be made within 10 days of the first notice given to the City of the intent to hook up to the system, and the balance shall be paid prior to hookup to the system.
(c) 
Where the parcel to be served requires site plan approval under Chapter 220, Zoning, or plat approval under Chapter 182, Subdivision of Land, or approval under the provisions of Act 98 of the Michigan Public Acts of 1913, as amended, and less than 20 residential equivalents of service will be required, the sewer separation fee shall be payable to the City prior to approval of the site plan, final approval of the plat or submission for state approval under Act 98 of 1913. Such fees shall be refundable if the required approval is denied.
(d) 
Where the parcel to be served requires site plan approval under Chapter 220, Zoning, or plat approval under Chapter 182, Subdivision of Land, or approval under the provisions of Act 98 of the Michigan Public Acts of 1913, as amended, and more than 20 residential equivalents of service will be required, a deposit equal to the sewer separation fee for 20 residential equivalents of service shall be paid to the City prior to approval of the site plan, final approval of the plat or submission for state approval under Act 98 of 1913. Following approval, a sewer separation fee for each residential equivalent of service shall be paid to the City prior to hookup to the system, without reference to the deposit required, until such time as only 20 residential equivalents of service remain to be furnished with hookup to the system, at which time one sewer separation fee for each of the 20 residential equivalents of service may be deducted from the deposit until the deposit is exhausted. The deposit shall be refunded by the City if the required approval is denied.
(2) 
All funds received by the City from payment of sewer separation fees shall be placed in the Water and Sewer Fund, Waste Water Department, and shall be used for capital improvements required to separate stormwater from the sanitary sewer system and to treat stormwater which cannot be removed from the system in a cost-effective manner.

§ 214-10 No free service.

No free service shall be furnished by said system to any person, firm or corporation, public or private, or to any public agency or instrumentality.

§ 214-11 Rate covenant.

A. 
The rates hereby fixed are established to be sufficient to provide for the payment of the expenses of administration and operation and such expenses for maintenance of the said system as are necessary to preserve the same in good repair and working order, to provide for the payment of the interest upon and the principal of all the bonds as and when the same become due and payable, and the creation of the reserve therefor required by this article, and to provide for such other expenditures and funds for said system as this article may require. Such rates shall be fixed and revised from time to time as may be necessary to produce these amounts, and it is hereby covenanted and agreed at all times to fix and maintain such rates for services furnished by the system as shall be sufficient to provide for the foregoing.
B. 
The rates and charges hereby established shall be based upon a methodology which complies with applicable federal and state statutes and regulations. The amount of the rates and charges shall be sufficient to provide for debt service and for the expenses of operation, maintenance and replacement of the system as necessary to preserve the same in good repair and working order. The amount of the rates and charges shall be reviewed annually and revised when necessary to insure system expenses are met and that all users pay their proportionate share of operation, maintenance and equipment replacement expenses.
[Added 9-14-1992 by Ord. No. 432]
C. 
All customers of the City of Grand Ledge sewage disposal system shall receive an annual notification, either printed on the bill or enclosed in a separate letter, which will show the breakdown of the wastewater disposal bill into its components for:
[Added 9-14-1992 by Ord. No. 432]
(1) 
Operation, maintenance and replacement; and
(2) 
Debt service.

§ 214-12 Fiscal year.

The system shall be operated on the basis of an operating year commencing on July 1 and ending on the last day of June next following.

§ 214-13 Disposition of revenues.

From and after July 1, 1968, the revenues of the system shall be set aside, as collected and deposited in a depositary account in the Michigan National Bank, Grand Ledge, Michigan, a bank duly qualified to do business in Michigan, in an account to be designated "Water Supply and Sewage Disposal System Receiving Fund" (hereinafter, for brevity, referred to as the "Receiving Fund"), and said revenues so deposited are pledged for the purpose of the following funds and shall be transferred from the Receiving Fund periodically in the manner and at the times hereinafter specified.
A. 
Operation and Maintenance Fund.
(1) 
Out of the revenues in the Receiving Fund there shall be first set aside, quarterly, into a depositary account designated "Operation and Maintenance Fund," a sum sufficient to provide for the payment of the next quarter's current expenses of administration and operation of the system and such current expenses for the maintenance thereof as may be necessary to preserve the same in good repair and working order.
(2) 
The City Council, prior to the commencement of each operating year, shall adopt a budget covering the foregoing expenses for each year, and such total expenses shall not exceed the total amount specified in said budget, except by a vote of 2/3 of the members-elect of the City Council.
(3) 
On June 30, 1968, there shall be transferred from funds of the system then on hand to the Operation and Maintenance Fund a sum sufficient to meet operation and maintenance expenses of the system for the quarterly period beginning July 1, 1968.
B. 
Bond and Interest Redemption Fund.
(1) 
There shall next be established and maintained a separate depositary account, designated as the "Bond and Interest Redemption Fund," the moneys on deposit therein from time to time to be used solely for the purpose of paying the principal of and interest upon the bonds hereby authorized. The moneys in the Bond and Interest Redemption Fund (including the Bond Reserve Account hereinafter established) shall be kept on deposit with the bank or trust company the principal and interest on the bonds herein authorized are currently payable.
(2) 
Out of the revenues remaining in the Receiving Fund after provision has been made for expenses of operation and maintenance of the system, there shall next be set aside, quarterly, in the Bond and Interest Redemption Fund, a sum proportionately sufficient to provide for the payment of the principal of and interest upon all outstanding bonds payable from the revenues of the system as and when the same become due and payable. Commencing July 1, 1968, the amount so set aside for interest each quarter during the first six months of each operating year shall not be less than 1/2 of the total amount of interest maturing on the following January 1, and each quarter during the last six months of each operating period shall be not less than 1/2 of the total amount of interest maturing on the following July 1. The amount so set aside for principal during each quarter during each operating year, commencing July 1, 1969, shall be not less than 1/4 of the amount of principal maturing on the July 1 following such operating year. If there shall be any deficiency in the amount previously required to be set aside, then the amount of such deficiency shall be added to the current requirements.
(3) 
There is hereby established in the Bond and Interest Redemption Fund a separate account to be known as the "Bond Reserve Account" into which there shall be paid in equal quarterly installments from the revenues of the system after provision has been made for the Operation and Maintenance Fund and the Bond and Interest Redemption Fund, the sum of $20,000 during each of the operating years beginning July 1, 1969, 1970 and 1971, so that there has been accumulated in said Bond Reserve Account the sum of $60,000. The moneys in said Bond Reserve Account shall be used solely for the payment of the principal and interest on said bonds as to which there would otherwise be default. If at any time it shall be necessary to use moneys in the Bond Reserve Account for such payment, then the moneys so used shall be replaced from the net revenues first received thereafter which are not required by this article to be used for operation and maintenance or for current principal and interest requirements; provided, however, that such Bond Reserve Account shall not be regarded as moneys otherwise appropriated or pledged for the purpose of determining the sufficiency of funds available for redemption of callable bonds.
(4) 
No further payments need be made into the Bond and Interest Redemption Fund after enough of the bonds have been retired so that the amount then held in said fund (including the Bond Reserve Account) is equal to the entire amount of principal and interest which will be payable at the time of maturity of all bonds then remaining outstanding.
C. 
Replacement Fund. There shall next be established and maintained a separate depositary account designated as the Replacement Fund, which shall be used solely for the purpose of making major repairs and replacements to the system. There shall be deposited into said fund in equal quarterly installments after providing for the foregoing requirements the sum of $5,000 during each of the operating years beginning July 1, 1969, 1970, 1971 and 1972, so that there has been accumulated in said Replacement Fund the sum of $20,000. If at any time it shall be necessary to use moneys in said fund for such purpose, the moneys so used shall be replaced from the net revenues in the Receiving Fund which are not required by this article to be used for the Operation and Maintenance Fund or the Bond and Interest Redemption Fund (including the Bond Reserve Account), so that said Replacement Fund shall again total $20,000.
D. 
Improvement and Repair Fund. There shall next be established a depositary account to be designated as the Improvement and Repair Fund, into which there shall be placed each quarter after meeting all of the foregoing requirements such sums as the City Council shall determine to be used for the purpose of acquiring and constructing improvements, additions and extensions to the system and for the purpose of making repairs and replacements to the system.
E. 
Surplus moneys. Any moneys remaining in the Receiving Fund at the end of any operating year, after full satisfaction of the requirements of the foregoing funds, may be transferred to the Bond and Interest Redemption Fund and used for the purpose of calling bonds for redemption in the manner herein specified, or transferred to the Improvement and Repair Fund and used for additions, improvements and extensions or repairs and replacements to the system or used for any other purpose permitted by law. If, however, there should be any deficit in the Operation and Maintenance Fund, the Bond and Interest Redemption Fund (including the Bond Reserve Account) or the Replacement Fund, on account of default in setting aside therein the amounts hereinbefore required, then transfers shall be made from the moneys remaining in the Receiving Fund at the end of any operating year to such funds in the priority and order named, to the extent of such deficits before any other use is made of said moneys so remaining.
F. 
Bank accounts. Moneys in the Receiving Fund, the Operation and Maintenance Fund, the Replacement Fund and the Improvement and Repair Fund may be kept in one bank account in which event the moneys in said bank account shall be allocated on the books and records of the City to said funds in the manner and at the times as above provided.

§ 214-14 Use of funds on hand.

On June 30, 1968, all cash on hand belonging to the system, and not specifically allocated for a definite purpose, shall he used as follows and in the following order of priority:
A. 
First, a sum sufficient to pay operation and maintenance expenses of the system for the quarterly period beginning July 1, 1968, shall be placed in the Operation and Maintenance Fund.
B. 
Second, the balance of said moneys shall be placed in the Receiving Fund established by this article.

§ 214-15 Use of funds in case of deficit.

In the event the moneys in the Receiving Fund are insufficient to provide for the current requirements of the Operation and Maintenance Fund or the Bond and Interest Redemption Fund, any moneys and/or securities in other funds (except the bonds proceeds) of the system shall be transferred, first, to the Operation and Maintenance Fund, and second, to the Bond and Interest Redemption Fund to the extent of any deficit therein.

§ 214-16 Investment of funds.

Moneys in the several funds and accounts herein established, including the moneys derived from the proceeds of sale of the bonds, may be invested in obligations of the United States of America, subject to the limitation provided in Act 94, Public Acts of Michigan, 1933, as amended. In the event such investments are made, the securities representing the same shall be kept on deposit with the bank or trust company having on deposit the fund or funds from which such purchase was made. Income received from such investments shall be credited to the fund from which said investments were made.

§ 214-17 Sale of bonds.

Said bonds shall be sold and the proceeds applied in accordance with the provisions of Act 94, Public Acts of Michigan, 1933, as amended.

§ 214-18 Proceeds of sale of bonds.

A. 
The proceeds of the sale of the bonds herein authorized to be issued shall be deposited in the Michigan National Bank, Grand Ledge, Michigan, a bank insured by the Federal Deposit Insurance Corporation. From the proceeds of sale of the bonds there shall be immediately transferred to the Bond and Interest Redemption Fund, the accrued interest, the premium, if any, received on sale and delivery of the bonds. The balance of such proceeds shall be applied solely in payment of the cost of the public improvements hereinbefore described and any engineering, legal and other expenses incident thereto and to the financing thereof. Payments for construction, either on account or otherwise, shall not he made unless the registered engineer in charge of such work shall file with the City Council a signed statement to the effect that the work has been completed in accordance with the plans and specifications therefor, that it was done pursuant to and in accordance with the contract therefor, and that such work is entirely satisfactory.
B. 
Any unexpended balance of the proceeds of sale remaining, after completion of the public improvements herein authorized, may, in the discretion of the City Council, but not more than $139,000, be used for further improvements, enlargements and extensions to the system, provided that at the time of such expenditure such use be approved by the Municipal Finance Commission. Any remaining balance after such expenditure shall be paid into the Bond and Interest Redemption Fund and shall be used for the redemption of callable bonds, or prior to the first call date only, purchasing bonds on the open market at not more than the fair market value thereof, and at a price in any event not exceeding the first call price.

§ 214-19 Covenants of City.

The City covenants and agrees with the successive holders of the bonds and coupons that so long as any of the bonds remain outstanding and unpaid as to other principal or interest:
A. 
The City will maintain the system in good repair and working order and will operate the same efficiently and will faithfully and punctually perform all duties with reference to the system required by the Constitution and laws of the State of Michigan, including the sewer services rendered by the system, and the segregation and application of the revenues of the system in the manner provided in this article.
B. 
The City will cause to be maintained and kept proper books of record and account, separate from all other records and accounts of the City, in which shall be made full and correct entries of all transactions relating to the system. Not later than 60 days after the close of each operating year, the City will cause to be prepared on forms furnished by the Municipal Finance Commission, if such forms be available, a statement in reasonable detail, sworn to by its Chief Accounting Officer, showing the cast income and disbursements of the system during each operating year, the assets and liabilities of the system at the beginning and close of the fiscal year, and such other information as is necessary to enable any taxpayer of the City, user of the service furnished, or any holder or owner of the bonds or anyone acting in their interest, to be fully informed as to all matters pertaining to the financial operation of the system during each year. A certified copy of such statement shall be filed within 90 days after the close of each operating year with the Municipal Finance Commission, and a copy sent to the manager of the account purchasing the bonds. Such statement and books of record and account shall at all reasonable times be open to inspection by any taxpayer of the City, user of the service or holder or holders of any bonds or anyone acting in their behalf. The City will also cause an annual audit of such books of record and account for the preceding operating year to be made each year by a recognized independent certified public accountant, and will mail a copy of such audit to the manager of the syndicate or account purchasing the bonds. Such audit shall be completed and so made available not later than three months after the closing of each operating year. Said audit may, at the option of the City, be used in lieu of the report on forms of the Municipal Finance Commission for all purposes for which said forms are required to be used.
C. 
The City will maintain and carry, for the benefit of the holders of the bonds, insurance on all physical properties of the system, of the kinds and in the amounts normally carried by public utility companies and municipalities engaged in the operation of water supply and sewage disposal systems. All moneys received for losses under and such insurance policies shall be applied solely to the replacement and restoration of the property damaged or destroyed, and to the extent not so used, shall be used for the purpose of calling bonds.
D. 
The City will not sell, lease or dispose of the system, or any substantial part thereof, until all of the bonds have been paid in full, both as to principal and interest. The City further will cause the operation of the system to be carried on as economically as possible, will cause to be made to the system all repairs and replacements necessary to keep the same in good repair and working order and will not do or suffer to be done any act which would affect the system in such a way as to impair or affect unfavorably the security of the bonds. The City will not grant any franchise that will result in the operation of a water facility or sewer facility that will compete with the system.

§ 214-20 Additional bonds.

A. 
The right is reserved, in accordance with the provisions of Act 94, Public Acts of Michigan, 1933, as amended, to issue additional bonds payable from the revenues of the system, which shall be of equal standing with the bonds herein authorized but only for the following purposes:
(1) 
To complete the public improvements in accordance with the plans and specifications therefor, and such bonds shall not be authorized unless the consulting engineers, or the successor engineers in charge of construction, shall execute a certificate evidencing the fact that additional funds are needed to complete the public improvements in accordance with the plans and specifications therefor. If such certificate shall be so executed and filed with the City Clerk, it shall be the duty of the City Council to provide for and issue additional revenue bonds in the amount stated in said certificate to be necessary to complete the public improvements in accordance with the plans and specifications.
(2) 
For subsequent extensions and improvements to the system, provided that no such additional bonds shall be issued unless the average net revenues for the last two preceding completed operating years of the system or the net revenues for the last completed operating year, whichever is lower, when supplemented by the net revenues estimated to accrue from an increase in rates for water and/or sewer service placed into effect at the time of or prior to the authorization of said additional bonds shall be equal to at least 1 1/3 times the largest annual principal and interest requirements thereafter maturing on the bonds herein authorized, on any then previously issued bonds of equal standing with the bonds herein authorized, and on such additional bonds then being issued. Prior to the issuance of any additional bonds pursuant to this subsection, there shall be filed with the City Clerk a statement showing the net revenues for each of the two immediately preceding completed operating years, the estimated increase in net revenues from said increase in rates, and the annual principal and interest requirements on all outstanding bonds payable from revenues of the system and the bonds proposed to be issued. Said statement shall be executed by a registered engineer appointed by the City. Permission of the Municipal Finance Commission (or such other State body having jurisdiction over the issuance of municipal bonds) to issue such additional bonds shall constitute a conclusive presumption of the existence of conditions permitting the issuance thereof.
B. 
Except as herein authorized, no additional bonds having equal standing with the bonds of this issue shall be authorized or issued.

§ 214-21 Form of bond and coupon.

Said bonds and coupons shall be in substantially the following form:
UNITED STATES OF AMERICA
STATE OF MICHIGAN
COUNTY OF EATON
CITY OF GRAND LEDGE
WATER SUPPLY AND SEWAGE DISPOSAL SYSTEM REVENUE BOND
No. ______
$5,000.00
KNOW ALL MEN BY THESE PRESENTS that the CITY OF GRAND LEDGE, County of Eaton, State of Michigan, for value received, hereby promises to pay to the bearer hereof, but only out of the revenues of the Water Supply and Sewage Disposal System of the City of Grand Ledge, including all appurtenances, extensions and improvements thereto, the sum of
FIVE THOUSAND DOLLARS
on the first day of July, A.D., 19, ____, with interest thereon from the date hereof until paid at the rate of ___________________________ per cent ( %) per annum, payable on January 1, 1969, and semiannually thereafter on the first day of July and January of each year, upon presentation and surrender of the proper interest coupons hereto attached as they severally become due. Both principal of and interest on this bond are payable in lawful money of the United States of America at _________________________________________________________, and for the prompt payment thereof, the gross revenues of the Water Supply and Sewage Disposal System of the City of Grand Ledge, including all appurtenances, extensions and improvements thereto, after provision has been made for reasonable and necessary expenses of operation, administration and maintenance, are irrevocably pledged and a statutory first lien thereon is hereby created.
This bond is one of a series of 186 bonds of even date and like tenor, except as to rate of interest and date of maturity, aggregating the principal sum of $390,000.00, numbered consecutively in direct order of maturity from 1 upwards, issued pursuant to Ordinance No. ____, duly adopted by the City Council on May ____, 1968, 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 improvements to the Water Supply and Sewage Disposal System of the City of Grand Ledge.
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 equal standing may hereafter be issued, and the general covenants and provisions pursuant to which this bond is issued, reference is made to the above-described Ordinance.
Bonds of this issue maturing in the years 1970 to 1983, inclusive, will not be subject to prior redemption.
The right is reserved of redeeming bonds maturing in the years 1984 to 1996, inclusive, at the option of the City, in inverse numerical order, on any interest payment date on or after July 1, 1983.
Bonds called for redemption shall be redeemed at par and accrued interest to the date fixed for redemption, plus a premium as follows:
4% of par value on each bond called for redemption prior to July 1, 1986;
3% of par value on each bond called for redemption on or after July 1, 1986, but prior to July 1, 1989;
2% of par value on each bond called for redemption on or after July 1, 1989, but prior to July 1, 1992;
1% of par value on each bond called for redemption on or after July 1, 1992, but prior to maturity.
Thirty days' notice of the call of any bonds for redemption shall be given by publication in a paper circulated in the State of Michigan which carries, as part of its regular service, notices of sale of municipal bonds. Bonds so called for redemption shall not bear interest after the date fixed for redemption provided funds are on hand with the paying agent to redeem said bonds.
This bond is a self-liquidating bond and is not a general obligation of the City of Grand Ledge and does not constitute an indebtedness of the City of Grand Ledge within any constitutional or statutory limitation, and is payable, both as to principal and interest, solely from the revenues of the Water Supply and Sewage Disposal System of the City. The principal and interest on this bond are secured by the statutory lien hereinbefore mentioned.
The City of Grand Ledge hereby covenants and agrees to fix and maintain at all times while any of such bonds shall be outstanding such rates for service furnished by said Water Supply and Sewage System as shall be sufficient to provide for payment of the interest upon and the principal of all such bonds as and when the same become due and payable, and to create a bond and interest redemption fund (including a bond reserve account) therefor, to provide for the payment of expenses of administration and operation and such expenses for maintenance of said Water Supply and Sewage Disposal System as are necessary to preserve the same in good repair and working order, and to provide for such other expenditures and funds for said system as are required by said Ordinance.
This bond and the interest thereon are exempt from any and all taxation whatsoever by the State of Michigan, or by any taxing authority within said State.
It is hereby certified and recited that all acts, conditions and things required by law precedent to and in the issuance of this bond and the series of which this is one have been done and performed in regular and due time and form as required by law.
IN WITNESS WHEREOF, the City of Grand Ledge, County of Eaton, State of Michigan, by its City Council, has caused this bond to be signed in the name of said City by its Mayor and to be countersigned by its City Clerk, and its corporate seal to be hereunto affixed, and has caused the annexed interest coupons to be executed with the facsimile signature of its City Treasurer, all as of the first day of July, A.D., 1968.
CITY OF GRAND LEDGE
By __________________
       Mayor
(Seal)
Countersigned;
__________________________
City Clerk
(Form of Coupon)
No. ______
$ __________
On the first day of __________________________, A.D., 19 ____, the City of Grand Ledge, County of Eaton, State of Michigan, will pay to the bearer hereof the sum shown hereon, in the manner and out of the revenues described in said bond at __________________________________, being the interest due that date on its Water Supply and Sewage Disposal System Revenue Bond, dated July 1, 1968.
This coupon is not a general obligation of the City of Grand Ledge, but is payable from certain revenues as set forth in the bond to which it pertains.
City Treasurer
__________________

§ 214-22 Application to Municipal Finance Commission.

The City Clerk is hereby authorized and directed to make application to the Municipal Finance Commission for authority to issue and sell said bonds, and for approval of the form of notice of sale of said bonds in accordance with the provisions of Act 202, Public Acts of Michigan, 1943, as amended, and of Act 94, Public Acts of Michigan, 1933, as amended.
[Adopted 9-26-1994 by Ord. No. 439]

§ 214-23 Definitions.

Unless the context of this article specifically indicates otherwise, the meanings of the terms used in this article shall be as follows:
ABUTTING PROPERTY
The property abutting a public sewer and/or water main, whether through or from the front, side or back of the premises.
BENEFIT CHARGE
A charge imposed on premises in lieu of a main charge for the privilege of connecting a lateral main to the public sewer or water system.
CONNECTION or CONNECTING
The act of joining a sewer or water conduit to a new or existing building or premises which results in the providing of public sewer or water service to the building or premises.
DEVELOPER
Any person and his or her successors, heirs, or assigns who pursuant to contract with the City of Grand Ledge privately funds additions or extensions to the public sewer or water system.
LATERAL MAIN
A sewer or water main that either serves or is intended to serve two or more lots and/or buildings thereon and is designed to be connected to a privately funded extension to the public sewer or water system.
MAIN CHARGE
A charge imposed upon premises to defray the cost of privately funded additions or extensions to the public sewer or water system.
PERSON
Any individual, firm, company, partnership, limited partnership, association, society, public or private corporation or group.
PREMISES
Land and any building thereon.
PRIVATELY FUNDED EXTENSION or PRIVATELY FUNDED MAIN
Any addition or extension to the public sewer or water system financed by a person other than the City of Grand Ledge.
PUBLIC SEWER OR WATER SYSTEM
A system of sewer or water conduit in which the owners of property serviced thereby have equal rights and which is controlled by the City of Grand Ledge, and shall include storm sewers.
THIRD PARTY
Those persons and their successors, heirs or assigns who do not join with the developer and/or the City of Grand Ledge in a contract to privately fund extensions to the public sewer or water system.
TOTAL PROJECT COST
For any privately funded extension to the public sewer or water system shall include, but not be limited to, the following costs: installed cost of the main, valves, manholes, fittings, stubs and other appurtenances thereto; all costs of repair, replacement, restoration, or protection of roads, landscape, waterways, or other environments; all costs of obtaining necessary easements; all costs of engineering, testing, planning and advertising; administrative costs and bidding costs, and reasonable attorneys' fees.

§ 214-24 Establishment of main and benefit charges.

A. 
Main charges for sewer and water are hereby established for the privilege of connecting any premises to the public sewer or water system whenever the public sewer and/or water mains available to the premises were the result of a privately funded extension to the system, and said premises did not participate in full in the cost of the extension.
B. 
It is the intent of these main charges to ensure that each premises connecting to the public sewer or water system by way of privately funded extensions thereto shall share proportionately in the cost of the extension(s).
C. 
In lieu of a main charge, the connection of any lateral main to the public sewer or water system shall be subject to a benefit charge as provided for in § 214-27 of this article.
D. 
The City shall determine main and/or benefit charges due from third parties in accordance with the procedures set forth in §§ 214-25 through 214-27 of this article, respectively. The City shall also collect such main and/or benefit charges as set forth in § 214-29. Further, the City may, by written contract or otherwise, agree to rebate any main or benefit charges collected to the developer responsible for financing the extension.
E. 
Unless extended by the City Council at the request of the developer, or unless the contract between the City and the developer expressly provides otherwise, the City's right to collect the main and benefit charges established by this article, and the developer's right to any rebate thereof, shall automatically terminate seven years from the date of acceptance of the privately funded extension by the City.

§ 214-25 Calculation of sewer main charges.

A. 
Whenever a developer constructs a sewer main and the properties which may potentially be connected to the main do not participate directly in the cost of said main, the Council shall determine, based upon information provided by the developer, the total project cost of the main as defined by § 214-23 of this article.
B. 
The total project cost shall then be spread proportionately by percentage against all abutting properties that may potentially connect to the privately funded extension. The percentage of the cost each abutting property shall bear (main charge) shall be determined by dividing the total street frontage of the individual lot or parcel by the total street frontage of all abutting properties that may potentially connect to, or may already be connected to, the privately funded main. The cost each abutting property shall bear shall be subject to adjustment to account for the residential equivalent flow generated from the proposed facility as determined by the City Engineer.
C. 
Where a parcel lies at the intersection of two streets or roads and is abutted on both of those sides by a sewer main, the footage for which a main charge is made shall be calculated as follows in order to grant a measure of relief to the property owner:
(1) 
Where both property lines and mains abutting the intersecting streets are less than 200 feet long, only the shorter of the two sides shall be used in calculating sewer main charges.
(2) 
If one or both property lines and abutting lines are over 200 feet in length, 200 feet shall be subtracted from the total footage of abutting main in calculating the main charge.
D. 
In addition to the charges described above, an interest charge of 6% per annum from the date the project was accepted by Grand Ledge, and prorated through the month of payment, shall be added to all charges imposed pursuant to this section.

§ 214-26 Calculation of water main charges.

A. 
Whenever a developer constructs a water main and the properties which may potentially be connected to the main do not participate directly in the cost of said main, the Council shall determine, based upon information provided by the developer, the total project cost of the main as defined by § 214-23 of this article.
B. 
Main size.
(1) 
The total project cost shall then be spread proportionately by percentage against all abutting properties that may potentially connect to the privately funded extension. The percentage of the cost each abutting property shall bear (main charge) shall be determined by dividing the total street frontage of the individual lot or parcel by the total street frontage of all abutting properties that may potentially connect to, or may already be connected to, the privately funded main. Further, even though the water main size abutting the actual premises may be greater than that listed in the following table, the main charge applicable to the abutting premises shall be based on that portion of the cost which would have been charged had the project of interest been constructed using a main of the size listed:
Premises
Main Size
(inches)
Residential structures from one through four units
6
Residential structures from four units to 12,000 square feet of total floor area
8
Residential structures over 12,000 square feet of total floor area
10
Nonresidential structures less than 40,000 square feet of total floor area
8
All structures over 40,000 square feet of total floor area
10
(2) 
If the actual main size abutting the premises is less than that listed in the table above, then the actual main size shall be used for determining the proportionate cost.
C. 
Where a parcel lies at the intersection of two streets or roads and is abutted on both of those sides by a water main, the footage for which a main charge is made shall be calculated as follows in order to grant a measure of relief to the property owner:
(1) 
Where both property lines and mains abutting the intersecting streets are less than 200 feet long, only the shorter of the two sides shall be used in calculating water main charges.
(2) 
If one or both property lines and abutting lines are over 200 feet in length, 200 feet shall be subtracted from the total footage of abutting main in calculating the main charge.
D. 
In addition to the charges described above, an interest charge of 6% per annum from the date the project was accepted by Grand Ledge, and prorated through the month of payment, shall be added to all charges imposed pursuant to this section.

§ 214-27 Calculation of benefit charges.

A. 
In any case in which a lateral main is to be connected to a privately funded extension to the public sewer or water system, or in the case of any premises that are located such that their street frontage cannot be determined (i.e., landlocked premises), the Council shall determine, by resolution, the benefit to be charged against the abutting premises in lieu of a sewer or water main charge.
B. 
The benefit charge for abutting premises shall be calculated by first determining the percentage of the total project cost the property should bear based on frontage, in accordance with the formula set forth in §§ 214-25 and 214-26 of this article, whichever is applicable. Further, Council shall also consider the following additional criteria:
(1) 
The number of lots or parcels or residential equivalents contained in any subdivision(s) to be serviced by the lateral main;
(2) 
If applicable, the fact that the party seeking to connect the lateral main is a developer who has otherwise contributed substantially to the improvement of the public sewer or water system beyond the developer's own needs; and
(3) 
Any other policy or criteria that the City Council, upon recommendation of the Utilities Department or the City Engineer, believes should be considered in determining an appropriate charge.
C. 
The benefit charge applicable to any premises whose frontage cannot be determined shall be computed by considering the residential equivalent flow applicable to the premises, as well as any other criteria that the Council, upon recommendation of the Utilities Department or the City Engineer, shall deem relevant in determining the benefit provided to such premises.
D. 
In addition to the charges described above, an interest charge of 6% per annum from the date the project was accepted by Grand Ledge, and prorated through the month of payment, shall be added to all charges imposed pursuant to this section.

§ 214-28 Contracts between City and developer.

[Amended 7-28-2003 by Ord. No. 488]
A. 
No privately funded extensions to the public sewer and/or water supply systems shall be allowed except by prior written contract with the City of Grand Ledge. Before any sanitary sewer or water supply system (not including individual building leads) constructed by private, as distinguished from public, funding shall be permitted to connect to the system, the owner of said system shall enter into a utility agreement; said agreement shall relate to the construction of sanitary sewer and/or water supply and shall set forth the terms and conditions of such construction, plan review and approval, inspection, right-of-way transfer, cost, escrow, construction standards, allocation of risk of loss, and other matters as may be deemed appropriate. A specimen of the City's standard utility agreement is available for review in the Grand Ledge City offices.
B. 
Such contract and/or utility agreement for sanitary sewer may expressly provide for the rebate of main or benefit charges to the developer for the privately funded extension to the system.
C. 
Any contract between the City of Grand Ledge and the developer providing for a rebate of main and/or benefit charges shall specify that such rebates shall only be paid to the developer if and when the main and/or benefit charges due from third parties under this article are actually paid to and received by the City. Further, in no case shall the developer be reimbursed more than the total project cost incurred by him in constructing the privately funded main.

§ 214-29 Collection of main and benefit charges.

Subject to the provisions of §§ 214-24E and 214-30 of this article, the main and benefit charges imposed by this article shall be collected under the following conditions and at the following times:
A. 
From each premises requesting to use, or required to use, a privately funded extension to the public sewer or water system for which the applicable main charge has not previously been paid.
B. 
Upon application for a building permit for the purpose of erecting new buildings, all applicable charges established by this article shall be collected and fully paid before any such permit shall issue.
C. 
Upon application for authorization to connect any new building or existing building to a privately funded addition to the public sewer or water system, all applicable charges shall be collected and fully paid. No authorizations to connect to the public sewer and/or water system shall be granted until the main charges applicable to the premises applied for have been fully paid in accordance with this article.
D. 
Prior to the start of construction of new buildings or additions to existing buildings when a building permit is not required, or prior to the connection of any lateral main to the public sewer or water system, all applicable charges shall be paid.

§ 214-30 Deferment of main and benefit charges over time.

In order to provide the City's customers with the advantages of long-term financing, the charges established by this article may be deferred and paid in installments as follows:
A. 
The main and benefit charges established by this article may be paid in as many as seven equal annual installments; provided, however, that the balance due shall be paid in full prior to the date upon which the developer's right to a rebate of such charges terminates pursuant to § 214-24E of this article. In the event the City extends the time period for rebating main and benefit charges to the developer in accordance with § 214-24E, then the time period for paying said charges in installments shall also be extended to correspond with the extension granted the developer. Payments pursuant to this subsection shall bear interest at a rate of 6% per annum on the unpaid principal balance as computed at the time of connection.
B. 
In order to secure the payment of the charges established by this article, the City shall have a lien in the amount of such charges upon the real property serviced by the main. Any payment delinquent for three months or more shall be certified to the office of the City Treasurer, who shall enter the same upon the next tax roll against the property for which such charges were incurred, and such charges shall be collected and such liens shall be enforced in the same manner and subject to the same collection and penalty charges as provided for with regard to the collection of general ad valorem property taxes. Further, in addition to any other enforcement methods, the payment may be enforced by discontinuing the water and/or sewer service to such property, and all charges may be recovered by the City by way of court action.