Update your community’s Capital Improvement Program

Planning commissions should annually prepare a capital improvements program of public structures and improvements.

“To further the desirable future development of the local unit of government under the master plan, a planning commission, after adoption of a master plan, shall annually prepare a capital improvements program of public structures and improvements…” (MCL 125.3865(1)). And so the Michigan Planning Enabling Act (MPEA) Public Act 33 of 2008, as amended, sets forth the requirement that planning commissions annually prepare a capital improvements program (CIP) for an ensuing six-years.

As is the case with any rule, there are exceptions to this one. First, the requirement of preparing an annual CIP does not apply to a township that does not independently, or jointly with one or more local units of government, own or operate a water supply or sewage disposal system (§65(2)). Although a rural township without water or sewer is exempt from preparing a CIP, it remains permissible for any township planning commission to do so.

The second exception to the rule is if the planning commission is exempted from the requirement to prepare a CIP by charter or resolution. In other words, the legislative body can shoulder this responsibility themselves and relieve the planning commission from the obligation of preparing a CIP.

If the planning commission is exempted, the legislative body either shall prepare and adopt a CIP separate from or as a part of the annual budget, or delegate the preparation of the CIP to the chief elected official or a nonelected administrative official, subject to final approval by the legislative body (§65(1)). It is important to emphasize that exempting the planning commission from the responsibility to prepare a CIP does not exempt the local government from meeting this requirement of the MPEA.

Once the responsibility is sorted out, the responsible entity should establish a process of requesting from each department of the local government (that has authority for public structures or improvements) an annual inventory of desired public improvements with lists, plans and estimates of the time and cost involved.

The responsible entity will then need to develop a system with formal criteria for organizing and prioritizing the public structures and improvement projects that will be needed in the ensuing six years. It is also recommended that the responsible entity review each project to determine the conformance of the projects with the community master plan; after all, this is the reason the planning commission was charged with the responsibility of the CIP in the first place.

As with any public policy document, public review should be part of the decision making process, although a formal public hearing is not required by statute.

Finally, the responsible entity considers the CIP for approval. If it is the planning commission preparing the CIP, the action is to recommend the CIP to the legislative body for adoption. If it is the legislative body, or nonelected administrative official, preparing the CIP, the action is to adopt the CIP. The process is then done … until it begins again next year!

Actually, it’s really just the beginning. After the adoption of a CIP (and even in the absence of a CIP), construction shall not be started or authorized on a street, square, park, playground, public way or other open space or public building or structure covered by a municipal or county master plan until the project is submitted to the planning commission for review and approval (§61(1) and (2)). This routine review of infrastructure and capital expenditures will be the subject of a subsequent Michigan State University (MSU) Extension news article. Stay tuned.

In the meantime, MSU Extension has a step-by-step checklist for adopting a capital improvement program, which can assist your local government in implementing an effective CIP. See the Land Use Series: “Checklist #1J: Adopting and Updating a Capital Improvement Program.

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