Bill
HB 6273
Creates the Michigan Water Trust Fund to protect waters as a public trust and fund grants for affordability, lead pipe replacement, testing, and water infrastructure.
Executive Summary
HB 6273 would create the Michigan Water Trust Fund (Part 12 of the Natural Resources and Environmental Protection Act) to safeguard water resources as a public trust and to finance grants for water infrastructure, affordability, and related public health needs. The fund would be funded from royalties and other sources, invested by the state, and governed by a new Michigan Water Trust Fund Board within the Department of Environment, Great Lakes, and Energy. A prioritized set of grant programs target drinking water reliability, lead service line replacement, private well testing, wastewater regulation administration, and emergency water needs, with additional infrastructure grants possible once principal thresholds are met.
Key Provisions
- Public Trust of Waters: Reaffirms that Michigan’s waters (including groundwater) are held in the public trust for current and future generations, protecting quantity, quality, flows, levels, and public trust uses (drinking water, fishing, recreation, etc.).
- Creation and Funding: Establishes the Michigan Water Trust Fund in the state treasury. The fund may receive royalties from the Safe Drinking Water Act and other assets; earnings and interest belong to the fund. End-of-fiscal-year balances do not lapse to the general fund.
- Annual Reporting: Starting January 1, 2026, and each January 1 thereafter, the department must report fund revenues/expenses, earnings, unexpended cumulative earnings, investment performance, and total annual appropriations to the Legislature’s appropriations committees and environment/natural resources committees.
- Spending Cap and Principal Targets: Not more than 70% of annual revenues may be expended until the fund’s accumulated principal reaches $800,000,000. Once reached, the principal must generally remain between $750,000,000 and $1,500,000,000.
- Grant Program (Sec. 1207): The department will run a grant program funded by the fund to support:
- (a) Public water systems and similar entities to ensure continuous water supply for residential customers at or below 200% of the Federal Poverty Level.
- (b) Local units or nonprofits to cover bottled-water costs during water emergencies.
- (c) Lead service line replacement.
- (d) Local health departments for private well testing.
- (e) Onsite wastewater regulation administration by local health departments.
- (f) If principal > $750,000,000, grants for water infrastructure projects improving water quality, access to safe, affordable water, and flood resilience.
- Governance (Sec. 1209): Creation of the Michigan Water Trust Fund Board within the department.
- Members: the department director plus six governor-appointed members with Senate advice and consent who have relevant experience in local government, water infrastructure, or water management.
- Terms: four-year terms (with staggered initial terms: one 1-year, one 2-year, one 3-year, and three 4-year terms).
- First appointments due within 90 days of the act’s effective date; board must meet within 120 days of the act’s effective date and then at least biweekly or as otherwise specified.
- The governor can remove members for specified causes; board to elect a chair and officers at its first meeting.
Who is Affected
- Local water utilities, water authorities, and similar entities receiving grants.
- Local units of government and nonprofits addressing water emergencies, lead service lines, and infrastructure projects.
- Local health departments involved in private well testing and onsite wastewater regulation.
- Michigan residents eligible for water affordability supports (low-income households) and communities facing water quality or supply challenges.
Timeline and Procedural Aspects
- Introduced and read in House on December 10, 2024; referred to Committee on Natural Resources, Environment, Tourism and Outdoor Recreation.
- Requires rules under the Administrative Procedures Act to implement the grant program.
- Initial board appointments due within 90 days; first board meeting within 120 days post-enactment.
Fiscal/Policy Implications
- Establishes a dedicated, investment-managed fund with spending limits tied to principal to promote long-term stability.
- Allocates funds for both immediate needs (affordability, emergencies, testing) and long-term infrastructure resilience.
- Creates a formal governance and reporting framework to monitor fund performance and grant distribution.
Compiled from official sources — confirm details with the bill’s official record.
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