HB 4158 Summary

• Extends the sunset date for municipal bond issuance authority from December 31, 2015 to December 31, 2018, allowing counties, cities, villages, and townships to issue securities to pay unfunded pension and health care liabilities without voter approval.

• Requires municipalities to prepare and publicly disclose a comprehensive financial plan before issuing bonds, including analysis of current and future pension/health care obligations, evidence that bond proceeds will eliminate unfunded liabilities, and a debt service amortization schedule.

• Establishes credit rating requirements: municipalities must have a AA or higher rating, or an A or higher rating with bond insurance, to issue these securities.

• Requires municipalities to obtain state department approval before issuance and establish health care trust funds to hold bond proceeds dedicated solely to retiring the municipal securities issued.

• Prohibits municipalities from rescinding pension plan closures or cessation of accruals while bonds remain outstanding, though they may reduce benefits for future years of service accrual.