City of Coldwater, MI GENERAL FINANCE

At a regular meeting held not later than the second Monday in June of each year, the Council shall, by resolution, adopt a budget for the ensuing fiscal year and make an appropriation of the money needed therefor. Such resolution shall designate the sum to be raised by taxation for the general purposes of the city and for the payments of principal and interest on its indebtedness. Failure to adopt such resolution within the time herein set shall not invalidate either the budget or the tax levy therefor.

A copy of the appropriations for each fiscal year, certified by the Clerk, shall be furnished to the City Auditor within 10 days after the date of the adoption of the budget resolution.

Section 7.6 Budget Control.

Except for purposes which are to be financed by the issuance of bonds or by special assessments, no money shall be drawn from the treasury of the city, except in accordance with the budget in effect and the appropriation for such purpose, nor shall any obligation for the expenditure of money be incurred without an appropriation covering all payments which will be due under such obligation during the fiscal year. The Council, upon the written recommendation of the City Manager and by the affirmative vote of not less than six of its members, may appropriate unappropriated funds or transfer any unencumbered appropriation balance, or any portion thereof, from any budget item or account, department, or agency to another.

Expenditures shall not be charged directly to any contingent or general account. Instead, the necessary amount of the appropriation from such account shall be transferred to the appropriate budget item or account and the expenditure then charged thereto.

During each month, the City Manager shall submit to the Council data showing the relation between the estimated and actual revenues and expenditures for the general operation of the city to the end of the preceding month; and, if it shall appear that the revenues are less than anticipated, the Council may, by resolution, reduce appropriations, except amounts required for debt and interest charges, to such a degree as may be necessary to keep expenditure within the revenues.

Within 30 days following the end of each fiscal year, the City Manager shall file with the Council a schedule of all encumbrances upon the budget appropriations existing at the end of the fiscal year, with his recommendations thereon, and the Council shall provide for the payment of such thereof as constitute valid claims against the city from corresponding budget items from the then current fiscal year.

Section 7.7 Special Accounts.

The Council may, by ordinance, establish and maintain accounts for accumulating moneys to be used for acquiring, extending, altering, constructing, or repairing public improvements and for the purchase of equipment of any type, in each case either for a specific item or items or for future unspecified public improvements or equipment, or both.

Appropriations to such accounts may be made by the Council either in the annual appropriation resolution or, from time to time during the fiscal year, from available funds, from whatever source derived, which are not required for other appropriations or obligations of the city. Such accounts shall be continuing accounts and the balances therein at the end of each fiscal year shall remain a part thereof.

Moneys which are accumulated for the purpose of public improvements, as set forth in sub-section (a) hereof, shall be used only at the direction of the Council, and only for the purpose provided in the original ordinance establishing such account, unless their use for some other municipal purpose be authorized by a majority vote of the electors of the city who vote on the proposition to amend such ordinance to provide for a change in the use of the moneys in such account. After the purpose of any such account has been fulfilled, any balance remaining therein may be transferred by the Council to any other special account or to the general fund of the city.

Moneys which are accumulated for the purpose of purchasing equipment, as set forth in sub-section (a) hereof, shall be expended only for the purpose provided in the ordinance establishing any such account, or as such ordinance may be amended from time to time, and, when no longer required for such purpose, such moneys or any part thereof, may be transferred to the general fund by a resolution adopted by the affirmative vote of not less than six members of the Council.

Section 7.8 Withdrawal of City Moneys.

Unless otherwise provided by law or by ordinance, all moneys drawn from the treasury shall be drawn pursuant to the authority and appropriation of the Council. The Council, upon the recommendation of the City Manager, where necessary to expedite operating procedures, may authorize, in writing, other officers and employees of the city to make minor disbursement from petty cash accounts, which disbursements shall be accounted for and shall be audited by the City Auditor.

Checks for the disbursement of city funds shall be signed by the City Auditor and countersigned by the Treasurer.

Checks may be issued prior to authorization by the Council for such purposes and up to such amounts as the Council shall provide by ordinance.

Section 7.9 Notice to City of Claim for Injuries. [1]

The city shall not be liable in damages for injury to person or property by reason of negligence of the city, other than such as may arise from the exercise of a proprietary function of the city, unless, within 60 days after such injury occurred, the person damaged, or his representative, causes a written notice to be served upon an officer of the city upon whom process may be served by law. Such notice shall state that such person intends to hold the city liable for such damages and shall set forth substantially the time and place of the injury, the manner in which it occurred, the nature of the act or defect complained of, the extent of the injury so far as known, and the names and addresses of witnesses known to the claimant.

No person shall bring action against the city for damages to person or property arising out of any of the reasons or circumstances aforesaid, unless brought within the period prescribed by law, nor unless he has first presented to the Clerk a claim in writing and under oath, setting forth specifically the nature and extent of the injury and the amount of damages claimed. The Clerk shall refer the claim to the Council for action.

Failure to give notice of injury or to present a claim within the time and in the manner provided shall bar any action upon such claim.

The provisions and requirements of this section shall not apply to or control claims for damages to persons or property which arise out of the exercise of any proprietary function of the city.

(e)

This section shall not be deemed to waive any defense of immunity which the city may have from claims for damages arising out of negligence or otherwise, but shall apply in all cases where such defense is not available to the city.

[1]

Editor's Note: The provisions of this section regarding the period within which notice of a claim against the City must be served has been superseded by case law. Interested persons are advised to contact the City Attorney for the latest applicable law.

Section 7.10 Municipal Borrowing Power.

Subject to the applicable provisions of law, the city may borrow money for any purpose within the scope of its powers or which may be permitted by law, and may issue bonds or other evidences of indebtedness therefor. Such bonds or other evidences of indebtedness shall include, but not be limited to the following types:

(1)

General obligation bonds for the payment of which the full faith and credit of the city is pledged;

(2)

Special assessment bonds which are issued in anticipation of the payment of special assessments for the purpose of defraying the cost of any one or more public improvements which bonds shall be both an obligation of the special assessment district and a general obligation of the city as the Council may determine;

(3)

Revenue bonds, as authorized by law;

(4)

Tax anticipation notes, which may be issued in anticipation of the collection of taxes for the current or next succeeding fiscal years of the city or any other year permitted by law, in the manner and subject to any limitations provided by law;

(5)

Mortgage bonds, as authorized by law, for the acquiring, owning, purchasing, constructing, improving, or operating of any public utility which the city is authorized by law to finance in this manner;

(6)

Bonds issued in anticipation of future payments from the Motor Vehicle Highway Fund or any other fund of the State which the city may be permitted by law to pledge for payment of the principal and interest thereof, which bonds, if law so permits, may also be a general obligation of the city;

(7)

Water main extension bonds, in an amount not to exceed 1% of the assessed valuation of all real and personal property in the city, for the payment of which the full faith and credit of the city are pledged for the refunding from time to time of moneys advanced or paid on special assessments imposed for water main extensions as buildings are connected with such extensions, which bonds shall be payable in not more than 30 years, with interest thereon at a rate which shall not exceed 6% per annum;

(8)

Calamity bonds, issued in case of fire, flood, or other calamity for the relief of the inhabitants of the city and for the preservation of municipal property, in a sum not to exceed three-eighths of 1% of the assessed value of the real and personal property in the city, which shall become due in not more than five years.

Whenever any portion of public improvements shall be assessed by or charged to the city-at-large and the balance of such cost assessed against the property benefitted, the Council may provide for the payment of the city portion of such cost in installments. In such case, bonds may be issued in anticipation of the payment of the amount assessed against the city-at-large, the same as they may be issued in anticipation of the payment of the amount assessed against the benefitted property. In such case, the Council shall appropriate in each fiscal year an amount which is sufficient to pay the principal of and interest on such bonds which is required to be paid during that year. Such bonds may be included as a part of a total issue of bonds for the public improvement to which they apply and need not be separated from bonds issued in anticipation of the payment of special assessments assessed against the benefitted property.

Bonds may be issued in anticipation of the collection of special assessments levied with respect to two or more public improvements, but no special assessment district shall be required to pay the obligation of any other special assessment district and the ordinance or resolution creating such districts shall so provide.

All collections on special assessment rolls or on any combination of such rolls shall be set apart in a separate fund and shall be used for the purpose for which levied, and for the payment of the principal of and interest on bonds issued in anticipation of such special assessments. As to such of said bonds as are also a general obligation of the city, if there is any deficiency in any special assessment fund to meet the payment of the principal or interest to be paid therefrom, moneys shall be advanced from the general funds of the city to meet such deficiency, and shall be replaced in the general funds when the special assessment fund shall be sufficient therefor.

(e)

Each bond or other evidence of indebtedness shall contain on its face a statement specifying the purpose for which the same is issued, and the proceeds thereof shall not be used for any other purpose, except that, whenever the proceeds of any bond issue, or a part thereof, remain unexpended and unencumbered for the purpose for which said bond issue was made, the Council may, by the confirming vote of not less than five members, authorize the use of such unexpended and unencumbered funds:

(1)

For the retirement of such bond issue; or

(2)

If such bond issue has been fully retired, then for the retirement of other bonds or obligations of the city provided for by this section: Provided, that in the case of special assessment bonds, such funds shall be refunded to the owners of property against which special assessments therefor were made, or placed in the general fund of the city in accordance with the provisions of Section 9.2 of this charter; and

(3)

For such other purposes as may be permitted by law, subject to the proviso in paragraph (2) above; or

(4)

If such funds cannot be so used, then in any manner approved by the vote of not less than six members of the Council.

(f)

No bond or other evidence of indebtedness, regardless of type or purpose, shall bear interest at a rate exceeding that fixed by law.

(g)

All bonds and other evidences of indebtedness shall be signed by the Mayor and countersigned by the Clerk, under the seal of the city. Interest coupons may be executed with the facsimile signatures of the Mayor and the Clerk. A complete and detailed record of all bonds and other evidences of indebtedness shall be kept by the Treasurer. Upon the payment of any bond or other evidence of indebtedness, the same shall be marked "Cancelled" or otherwise defaced by the Treasurer to indicate payment.

Section 7.11 Limitations Upon Borrowing Power.

The net bonded indebtedness incurred for all public purposes shall not at any time exceed 10% of the assessed value of all the real and personal property in the city, as last equalized by the State of Michigan: Provided, that, in computing such net bonded indebtedness, there shall be excluded money borrowed under the provisions of Section 7.10. (a), clauses (2), (3), and (4) of this chapter, and any other bonds which are not, by law, subject to the debt limitation of the city. The resources of any debt retirement or sinking fund pledged for the retirement of any outstanding bonds which are subject to the debt limitation herein established shall also be deducted from the amount of the bonded indebtedness.