| 1 | 1 | | HOUSE BILL NO. 6072 A bill to amend 1969 PA 306, entitled "Administrative procedures act of 1969," by amending sections 71, 72, 80, 87, 115, 122, and 123 (MCL 24.271, 24.272, 24.280, 24.287, 24.315, 24.322, and 24.323), section 71 as amended by 1984 PA 28, section 80 as amended and section 123 as added by 1984 PA 196, section 115 as amended by 1996 PA 489, and section 122 as amended by 2011 PA 247. the people of the state of michigan enact: Sec. 71. (1) The parties in a contested case shall must be given an opportunity for a hearing without undue delay. (2) The parties shall must be given a reasonable notice of the hearing , which in a contested case. The notice shall must include all of the following: (a) A statement of the date, hour, place, and nature of the hearing. Unless otherwise specified in the notice the hearing shall must be held at the principal office of the agency. (b) A statement of the legal authority and jurisdiction under which the hearing is to be held. (c) A reference to the particular sections of the statutes and rules involved. (d) A short and plain statement of the matters asserted. If the agency or other party is unable to state the matters in detail at the time the notice is given, the initial notice may state the issues involved. Thereafter on application the agency or other party shall furnish a more definite and detailed statement on the issues. (3) A contested case is commenced by giving notice to the parties under subsection (2). (4) (3) A member of the legislature shall is not be privileged from service of notice or other process pursuant to under this chapter except on a day on which there is a scheduled meeting of the house of which he or she the legislator is a member. However, a member of the legislature shall is not be privileged from service of notice or other process pursuant to under this chapter on a day on which there is a scheduled meeting of the house of which he or she the legislator is a member, if such the service of notice or process is executed by certified mail, return receipt requested. Sec. 72. (1) If a party fails to appear in a contested case after proper service of notice, the agency, if no an adjournment is not granted, may proceed with the hearing and make its decision in the absence of the party. Notice is properly served if it is mailed to the party or the representative of record of the party at the party or the representative's last known address of record. (2) A party who has been that is served with a notice of hearing may file a written answer before the date set for hearing. (3) The parties shall must be given an opportunity to present oral and written arguments on issues of law and policy and an opportunity to present evidence and argument on issues of fact. (4) A party may cross-examine a witness, including the author of a document prepared by, on behalf of, or for use of the agency and offered in evidence. A party may submit rebuttal evidence. Sec. 80. (1) A presiding officer may do all of the following: (a) Administer oaths and affirmations. (b) Sign and issue subpoenas in the name of the agency, requiring attendance and giving of testimony by witnesses and the production of books, papers, and other documentary evidence. (c) Provide for the taking of testimony by deposition. (d) Regulate the course of the hearings, set the time and place for continued hearings, and fix the time for filing of briefs and other documents. (e) Direct the parties to appear and confer to consider simplification of the issues by consent of the parties. (f) Act upon on an application for an award of costs and fees under sections 121 to 127. (2) In order to assure To ensure adequate representation for the people of this state, when if the presiding officer knows that a party in a contested case is a member of the legislature of this state , and the legislature is in session, the presiding officer shall continue the contested case shall be continued by the presiding officer to a nonmeeting day. (3) In order to assure To ensure adequate representation for the people of this state, when if the presiding officer knows that a party to a contested case is a member of the legislature of this state who serves on a legislative committee, subcommittee, commission, or council that is scheduled to meet during the legislative session while the legislature is temporarily adjourned, or that is scheduled to meet during the interim between legislative sessions after the legislature has adjourned sine die, or when if the partisan caucus of which the legislator is a member is scheduled to meet, the presiding officer shall continue the contested case shall be continued to a nonmeeting day. (4) In order to assure To ensure adequate representation for the people of this state, when if the presiding officer knows that a witness in a contested case is a member of the legislature of this state, and the legislature is in session, or the member is serving on a legislative committee, subcommittee, commission, or council that is scheduled to meet during the legislative session while the legislature is temporarily adjourned or during the interim between legislative sessions after the legislature has adjourned sine die, or when if the partisan caucus of which the legislator is a member is scheduled to meet, the contested case need not be continued, but the presiding officer shall postpone the taking of the legislator's testimony, as a witness, shall be postponed to the earliest practicable nonmeeting day. (5) The presiding officer shall notify all parties to the contested case, and their attorneys, of any continuance granted pursuant to under this section. (6) As used in this section, "nonmeeting day" means a day on which there is not a scheduled meeting of the house of which the party or witness is a member, nor a legislative committee meeting or public hearing scheduled by a committee, subcommittee, commission, or council of which he or she the party or witness is a member, nor or a scheduled partisan caucus of the members of the house of which he or she the party or witness is a member. Sec. 87. (1) An agency or presiding officer may order a rehearing or reconsideration in a contested case on its the agency's or officer's own motion or on the request of a party. (2) Where If the agency or presiding officer finds for justifiable reasons that the record of testimony made at the hearing is found by the agency to be inadequate for purposes of judicial review, the agency or presiding officer, on its the agency's or officer's own motion or on the request of a party, shall order a rehearing. (3) A request for a rehearing shall must be filed within the time fixed by this act for instituting proceedings for judicial review. A rehearing shall must be noticed and conducted in the same manner as an original hearing. The evidence received at the rehearing shall must be included in the record for agency reconsideration and for judicial review. A decision or order may be amended or vacated after the rehearing. Sec. 115. (1) Chapters 4 and 6 do not apply to proceedings conducted under the worker's disability compensation act of 1969, Act No. 317 of the Public Acts of 1969, being sections 418.101 to 418.941 of the Michigan Compiled Laws.1969 PA 317, MCL 418.101 to 418.941. (2) Chapters 4 and 8 do not apply to a hearing conducted by the department of corrections pursuant to under chapter IIIA of Act No. 232 of the Public Acts of 1953, being sections 791.251 to 791.256 of the Michigan Compiled Laws.the corrections code of 1953, 1953 PA 232, MCL 791.251 to 791.256, or to proceedings before the parole board established under section 31a of the corrections code of 1953, 1953 PA 232, MCL 791.231a. (3) Chapter 8 does not apply to any of the following: (a) A contested case or other proceeding regarding the granting or renewing of an operator's or chauffeur's license by the secretary of state. (b) Proceedings conducted by the Michigan employment relations commission. (c) Worker's disability compensation proceedings under Act No. 317 of the Public Acts of 1969.the worker's disability compensation act of 1969, 1969 PA 317, MCL 418.101 to 418.941. (d) Unemployment compensation hearings under the Michigan employment security act, Act No. 1 of the Public Acts of the Extra Session of 1936, being sections 421.1 to 421.75 of the Michigan Compiled Laws.1936 (Ex Sess) PA 1, MCL 421.1 to 421.75. (e) Family independence agency public Public assistance hearings under section 9 of the social welfare act, Act No. 280 of the Public Acts of 1939, being section 400.9 of the Michigan Compiled Laws.1939 PA 280, MCL 400.9. (4) Chapter 6 does not apply to final decisions or orders rendered under article 15 of the public health code, Act No. 368 of the Public Acts of 1978, being sections 333.16101 to 333.18838 of the Michigan Compiled Laws.1978 PA 368, MCL 333.16101 to 333.18838. (5) Chapters After August 14, 1996, chapters 2, 3, and 5 do not apply to the municipal employees retirement system and retirement board created by the municipal employees retirement act of 1984, Act No. 427 of the Public Acts of 1984, being sections 38.1501 to 38.1555 of the Michigan Compiled Laws, on and after August 15, 1996.1984 PA 427, MCL 38.1501 to 38.1555. (6) Until the expiration of 12 months after the effective date of the amendatory act that added this subsection, April 1, 1998, chapters 2, 3, and 5 do not apply to the establishment, implementation, administration, operation, investment, or distribution of a Tier 2 retirement plan established pursuant to under section 401(k) of the internal revenue code of 1986, 26 USC 401, under the state employees' retirement act, Act No. 240 of the Public Acts of 1943, being sections 38.1 to 38.69 of the Michigan Compiled Laws. Upon the expiration of 12 months after the effective date of the amendatory act that added this subsection, 1943 PA 240, MCL 38.1 to 38.69. After March 31, 1998, rules and guidelines promulgated or processed under for the purposes described in this subsection are not effective and binding unless promulgated and processed in accordance with this act. (7) Until the expiration of 12 months after the effective date of the amendatory act that added this subsection, April 1, 1998, chapters 2, 3, and 5 do not apply to the establishment, implementation, administration, operation, investment, or distribution of a Tier 2 retirement plan established pursuant to under section 403(b) of the internal revenue code of 1986, 26 USC 403, under the public school employees retirement act of 1979, Act No. 300 of the Public Acts of 1980, being sections 38.1301 to 38.1437 of the Michigan Compiled Laws. Upon the expiration of 12 months after the effective date of the amendatory act that added this subsection, 1980 PA 300, MCL 38.1301 to 38.1437. After March 31, 1998, rules and guidelines promulgated or processed under for the purposes described in this subsection are not effective and binding unless promulgated and processed in accordance with this act. (8) Until the expiration of 12 months after the effective date of the amendatory act that added this subsection, April 1, 1998, chapters 2, 3, and 5 do not apply to the establishment, implementation, administration, operation, investment, or distribution of a Tier 2 retirement plan established pursuant to under the internal revenue code of 1986, 26 USC 1 to 9834, under the Michigan legislative retirement system act, Act No. 261 of the Public Acts of 1957, being sections 38.1001 to 38.1080 of the Michigan Compiled Laws. Upon the expiration of 12 months after the effective date of the amendatory act that added this subsection, 1957 PA 261, MCL 38.1001 to 38.1080. After March 31, 1998, rules and guidelines promulgated or processed under for the purposes described in this subsection are not effective and binding unless promulgated and processed in accordance with this act. Sec. 122. (1) "Contested case" means a contested case as defined in section 3, but does not include a case that is settled or in which a consent agreement is entered into or a proceeding for establishing a rate or approving, disapproving, or withdrawing approval of a form. (2) "Costs and fees" means the normal costs incurred, after a party has received notice of an initial hearing under section 71, in being a party in a contested case under this act, and include all of the following: (a) The reasonable and necessary expenses of expert witnesses as determined by the presiding officer. (b) The reasonable cost of any study, analysis, engineering report, test, or project that is determined by the presiding officer to have been necessary for the preparation of a the party's case. (c) Reasonable A reasonable and necessary attorney or agent fees fee, including those a fee for purposes of any appeal. (3) "Party" means a party as defined in section 5. , but does not include any of the following: (a) An individual whose net worth was more than $500,000.00 at the time the contested case was initiated. (b) The sole owner of an unincorporated business or any partnership, corporation, association, or organization whose net worth exceeded $3,000,000.00 at the time the contested case was initiated and that is not either exempt from taxation pursuant to section 501(c)(3) of the internal revenue code, 26 USC 501, or a cooperative association as defined in section 15(a) of the agricultural marketing act, 12 USC 1141j(a). (c) The sole owner of an unincorporated business or any partnership, corporation, association, or organization that had more than 250 full-time equivalent employees, as determined by the total number of employees multiplied by their working hours divided by 40, at the time the contested case was initiated. (d) As used in this subsection "net worth" means the amount remaining after the deduction of liabilities from assets as determined according to generally accepted accounting principles. (4) "Presiding officer" means an agency, 1 or more members of the agency, a person an individual designated by statute to conduct a contested case, or a hearing officer designated and authorized by the agency to conduct a contested case. (5) "Prevailing party" means either of the following, as applicable: (a) In an action involving several remedies, or issues or counts that state different causes of actions action or defenses, the party prevailing as to each remedy, issue, or count. (b) In an action involving only 1 issue or count stating only 1 cause of action or defense, the party prevailing on the entire record. Sec. 123. (1) The On stipulation of the parties or a motion under subsection (3), the presiding officer that who conducts a contested case shall award to a prevailing party, other than an agency, the costs and fees incurred by the party in connection with that the contested case, unless the agency demonstrates that the agency's position was substantially justifiable. However, subsection (2) applies in any of the following: (a) A proceeding involving illegal gambling and a licensee under the Michigan liquor control code of 1998, 1998 PA 58, MCL 436.1101 to 436.2303, to which the liquor control commission is a party. (b) A proceeding to which the department of health and human services is a party that relates to the child abuse and neglect central registry. (c) A licensing proceeding with respect to a summary suspension of the license that was required under section 92(2). (2) In a proceeding described in subsection (1), the presiding officer shall only award costs and fees under subsection (1) if the presiding officer finds that the position of the agency to in the proceeding was frivolous. To find that an agency's position was frivolous, the presiding officer shall must determine that at least 1 or more of the following conditions has been met:is applicable: (a) The agency's primary purpose in initiating the action was to harass, embarrass, or injure the prevailing party. (b) The agency had no reasonable basis to believe that the facts underlying its legal position were in fact true. (c) The agency's legal position was devoid of arguable legal merit. (3) (2) If the parties to a contested case do not agree on the awarding of costs and fees under this section, the prevailing party may file a motion for costs and fees. On a motion under this subsection, the presiding officer shall hold a hearing shall be held if requested by a party, regarding the awarding of costs and fees. and the amount thereof. The party seeking an award of costs and fees shall must present evidence establishing all of the following: (a) That If subsection (2) applies, that the position of the agency was frivolous. (b) That the party is a prevailing party. (c) The amount of costs and fees sought. including The party shall present an itemized statement from any an attorney , or agent , or who represented the party and any expert witness who represented the party showing the rate at which the costs and fees were computed. (d) That the party is eligible to receive an award under this section. Financial records of a party shall be are exempt from public disclosure if requested by the party so requests at the time the records are submitted pursuant to under this section. (e) That a final order that is not subject to further appeal other than for the judicial review of costs and fees provided for in section 125 has been entered in the contested case regarding the subject matter of the contested case. (4) (3) The presiding officer may reduce the amount of the costs and fees to be awarded under this section, or deny an award, to the extent that the party seeking the award engaged in conduct which that unduly and unreasonably protracted the contested case. (5) (4) The final action taken by the presiding officer under this section in regard to costs and fees shall must include written findings as to that the action and the basis for the findings. (6) (5) Subject to subsection (6), (7), the amount of costs and fees awarded under this section shall must include those reasonable and necessary costs actually incurred by the party and any costs allowed by law or by a rule promulgated under this act. Subject to subsection (6), (7), the amount of fees awarded under this section shall must be based upon on the prevailing market rate for the kind and quality of the services furnished, subject to the following: (a) The expenses paid for an expert witness shall must be reasonable and necessary as determined by the presiding officer. (b) An attorney or agent fee shall not be awarded at a rate of more than $75.00 per hour unless the presiding officer determines that special circumstances existed justifying a higher rate or an applicable rule promulgated by the agency provides for the payment of a higher rate because of special circumstances.must be a reasonable attorney fee as determined by the presiding officer following applicable supreme court precedent. (7) (6) The presiding officer shall only award costs and fees awarded under this section shall only be awarded to the extent and amount that the agency caused the prevailing party to incur those costs and fees. (8) (7) This section does not apply to any an agency in its role of hearing or adjudicating a case. Unless an agency has discretion to proceed, this section does not apply to an agency acting ex rel on the information and at the instigation of a nonagency person who that has a private interest in the matter nor or to an agency required by law to commence a case upon on the action or request of another nonagency person. (9) (8) This section does not apply to an agency that has such a minor role as a party in the case in comparison to other nonprevailing parties so as to make its liability for costs and fees under this section unreasonable, unjust, or unfair. Enacting section 1. This amendatory act takes effect 90 days after the date it is enacted into law. Enacting section 2. This amendatory act does not take effect unless Senate Bill No.____ or House Bill No. 6073 (request no. 05870'24) of the 102nd Legislature is enacted into law. |
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| 21 | 21 | | HOUSE BILL NO. 6072 |
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| 24 | 24 | | |
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| 25 | 25 | | A bill to amend 1969 PA 306, entitled |
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| 26 | 26 | | |
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| 27 | 27 | | "Administrative procedures act of 1969," |
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| 28 | 28 | | |
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| 29 | 29 | | by amending sections 71, 72, 80, 87, 115, 122, and 123 (MCL 24.271, 24.272, 24.280, 24.287, 24.315, 24.322, and 24.323), section 71 as amended by 1984 PA 28, section 80 as amended and section 123 as added by 1984 PA 196, section 115 as amended by 1996 PA 489, and section 122 as amended by 2011 PA 247. |
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| 30 | 30 | | |
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| 31 | 31 | | the people of the state of michigan enact: |
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| 32 | 32 | | |
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| 33 | 33 | | Sec. 71. (1) The parties in a contested case shall must be given an opportunity for a hearing without undue delay. |
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| 35 | 35 | | (2) The parties shall must be given a reasonable notice of the hearing , which in a contested case. The notice shall must include all of the following: |
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| 37 | 37 | | (a) A statement of the date, hour, place, and nature of the hearing. Unless otherwise specified in the notice the hearing shall must be held at the principal office of the agency. |
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| 39 | 39 | | (b) A statement of the legal authority and jurisdiction under which the hearing is to be held. |
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| 41 | 41 | | (c) A reference to the particular sections of the statutes and rules involved. |
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| 43 | 43 | | (d) A short and plain statement of the matters asserted. If the agency or other party is unable to state the matters in detail at the time the notice is given, the initial notice may state the issues involved. Thereafter on application the agency or other party shall furnish a more definite and detailed statement on the issues. |
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| 45 | 45 | | (3) A contested case is commenced by giving notice to the parties under subsection (2). |
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| 47 | 47 | | (4) (3) A member of the legislature shall is not be privileged from service of notice or other process pursuant to under this chapter except on a day on which there is a scheduled meeting of the house of which he or she the legislator is a member. However, a member of the legislature shall is not be privileged from service of notice or other process pursuant to under this chapter on a day on which there is a scheduled meeting of the house of which he or she the legislator is a member, if such the service of notice or process is executed by certified mail, return receipt requested. |
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| 49 | 49 | | Sec. 72. (1) If a party fails to appear in a contested case after proper service of notice, the agency, if no an adjournment is not granted, may proceed with the hearing and make its decision in the absence of the party. Notice is properly served if it is mailed to the party or the representative of record of the party at the party or the representative's last known address of record. |
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| 51 | 51 | | (2) A party who has been that is served with a notice of hearing may file a written answer before the date set for hearing. |
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| 53 | 53 | | (3) The parties shall must be given an opportunity to present oral and written arguments on issues of law and policy and an opportunity to present evidence and argument on issues of fact. |
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| 55 | 55 | | (4) A party may cross-examine a witness, including the author of a document prepared by, on behalf of, or for use of the agency and offered in evidence. A party may submit rebuttal evidence. |
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| 57 | 57 | | Sec. 80. (1) A presiding officer may do all of the following: |
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| 59 | 59 | | (a) Administer oaths and affirmations. |
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| 61 | 61 | | (b) Sign and issue subpoenas in the name of the agency, requiring attendance and giving of testimony by witnesses and the production of books, papers, and other documentary evidence. |
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| 62 | 62 | | |
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| 63 | 63 | | (c) Provide for the taking of testimony by deposition. |
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| 65 | 65 | | (d) Regulate the course of the hearings, set the time and place for continued hearings, and fix the time for filing of briefs and other documents. |
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| 66 | 66 | | |
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| 67 | 67 | | (e) Direct the parties to appear and confer to consider simplification of the issues by consent of the parties. |
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| 68 | 68 | | |
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| 69 | 69 | | (f) Act upon on an application for an award of costs and fees under sections 121 to 127. |
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| 71 | 71 | | (2) In order to assure To ensure adequate representation for the people of this state, when if the presiding officer knows that a party in a contested case is a member of the legislature of this state , and the legislature is in session, the presiding officer shall continue the contested case shall be continued by the presiding officer to a nonmeeting day. |
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| 73 | 73 | | (3) In order to assure To ensure adequate representation for the people of this state, when if the presiding officer knows that a party to a contested case is a member of the legislature of this state who serves on a legislative committee, subcommittee, commission, or council that is scheduled to meet during the legislative session while the legislature is temporarily adjourned, or that is scheduled to meet during the interim between legislative sessions after the legislature has adjourned sine die, or when if the partisan caucus of which the legislator is a member is scheduled to meet, the presiding officer shall continue the contested case shall be continued to a nonmeeting day. |
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| 75 | 75 | | (4) In order to assure To ensure adequate representation for the people of this state, when if the presiding officer knows that a witness in a contested case is a member of the legislature of this state, and the legislature is in session, or the member is serving on a legislative committee, subcommittee, commission, or council that is scheduled to meet during the legislative session while the legislature is temporarily adjourned or during the interim between legislative sessions after the legislature has adjourned sine die, or when if the partisan caucus of which the legislator is a member is scheduled to meet, the contested case need not be continued, but the presiding officer shall postpone the taking of the legislator's testimony, as a witness, shall be postponed to the earliest practicable nonmeeting day. |
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| 77 | 77 | | (5) The presiding officer shall notify all parties to the contested case, and their attorneys, of any continuance granted pursuant to under this section. |
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| 79 | 79 | | (6) As used in this section, "nonmeeting day" means a day on which there is not a scheduled meeting of the house of which the party or witness is a member, nor a legislative committee meeting or public hearing scheduled by a committee, subcommittee, commission, or council of which he or she the party or witness is a member, nor or a scheduled partisan caucus of the members of the house of which he or she the party or witness is a member. |
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| 81 | 81 | | Sec. 87. (1) An agency or presiding officer may order a rehearing or reconsideration in a contested case on its the agency's or officer's own motion or on the request of a party. |
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| 83 | 83 | | (2) Where If the agency or presiding officer finds for justifiable reasons that the record of testimony made at the hearing is found by the agency to be inadequate for purposes of judicial review, the agency or presiding officer, on its the agency's or officer's own motion or on the request of a party, shall order a rehearing. |
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| 85 | 85 | | (3) A request for a rehearing shall must be filed within the time fixed by this act for instituting proceedings for judicial review. A rehearing shall must be noticed and conducted in the same manner as an original hearing. The evidence received at the rehearing shall must be included in the record for agency reconsideration and for judicial review. A decision or order may be amended or vacated after the rehearing. |
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| 87 | 87 | | Sec. 115. (1) Chapters 4 and 6 do not apply to proceedings conducted under the worker's disability compensation act of 1969, Act No. 317 of the Public Acts of 1969, being sections 418.101 to 418.941 of the Michigan Compiled Laws.1969 PA 317, MCL 418.101 to 418.941. |
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| 89 | 89 | | (2) Chapters 4 and 8 do not apply to a hearing conducted by the department of corrections pursuant to under chapter IIIA of Act No. 232 of the Public Acts of 1953, being sections 791.251 to 791.256 of the Michigan Compiled Laws.the corrections code of 1953, 1953 PA 232, MCL 791.251 to 791.256, or to proceedings before the parole board established under section 31a of the corrections code of 1953, 1953 PA 232, MCL 791.231a. |
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| 91 | 91 | | (3) Chapter 8 does not apply to any of the following: |
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| 93 | 93 | | (a) A contested case or other proceeding regarding the granting or renewing of an operator's or chauffeur's license by the secretary of state. |
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| 95 | 95 | | (b) Proceedings conducted by the Michigan employment relations commission. |
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| 97 | 97 | | (c) Worker's disability compensation proceedings under Act No. 317 of the Public Acts of 1969.the worker's disability compensation act of 1969, 1969 PA 317, MCL 418.101 to 418.941. |
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| 99 | 99 | | (d) Unemployment compensation hearings under the Michigan employment security act, Act No. 1 of the Public Acts of the Extra Session of 1936, being sections 421.1 to 421.75 of the Michigan Compiled Laws.1936 (Ex Sess) PA 1, MCL 421.1 to 421.75. |
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| 101 | 101 | | (e) Family independence agency public Public assistance hearings under section 9 of the social welfare act, Act No. 280 of the Public Acts of 1939, being section 400.9 of the Michigan Compiled Laws.1939 PA 280, MCL 400.9. |
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| 103 | 103 | | (4) Chapter 6 does not apply to final decisions or orders rendered under article 15 of the public health code, Act No. 368 of the Public Acts of 1978, being sections 333.16101 to 333.18838 of the Michigan Compiled Laws.1978 PA 368, MCL 333.16101 to 333.18838. |
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| 105 | 105 | | (5) Chapters After August 14, 1996, chapters 2, 3, and 5 do not apply to the municipal employees retirement system and retirement board created by the municipal employees retirement act of 1984, Act No. 427 of the Public Acts of 1984, being sections 38.1501 to 38.1555 of the Michigan Compiled Laws, on and after August 15, 1996.1984 PA 427, MCL 38.1501 to 38.1555. |
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| 107 | 107 | | (6) Until the expiration of 12 months after the effective date of the amendatory act that added this subsection, April 1, 1998, chapters 2, 3, and 5 do not apply to the establishment, implementation, administration, operation, investment, or distribution of a Tier 2 retirement plan established pursuant to under section 401(k) of the internal revenue code of 1986, 26 USC 401, under the state employees' retirement act, Act No. 240 of the Public Acts of 1943, being sections 38.1 to 38.69 of the Michigan Compiled Laws. Upon the expiration of 12 months after the effective date of the amendatory act that added this subsection, 1943 PA 240, MCL 38.1 to 38.69. After March 31, 1998, rules and guidelines promulgated or processed under for the purposes described in this subsection are not effective and binding unless promulgated and processed in accordance with this act. |
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| 108 | 108 | | |
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| 109 | 109 | | (7) Until the expiration of 12 months after the effective date of the amendatory act that added this subsection, April 1, 1998, chapters 2, 3, and 5 do not apply to the establishment, implementation, administration, operation, investment, or distribution of a Tier 2 retirement plan established pursuant to under section 403(b) of the internal revenue code of 1986, 26 USC 403, under the public school employees retirement act of 1979, Act No. 300 of the Public Acts of 1980, being sections 38.1301 to 38.1437 of the Michigan Compiled Laws. Upon the expiration of 12 months after the effective date of the amendatory act that added this subsection, 1980 PA 300, MCL 38.1301 to 38.1437. After March 31, 1998, rules and guidelines promulgated or processed under for the purposes described in this subsection are not effective and binding unless promulgated and processed in accordance with this act. |
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| 110 | 110 | | |
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| 111 | 111 | | (8) Until the expiration of 12 months after the effective date of the amendatory act that added this subsection, April 1, 1998, chapters 2, 3, and 5 do not apply to the establishment, implementation, administration, operation, investment, or distribution of a Tier 2 retirement plan established pursuant to under the internal revenue code of 1986, 26 USC 1 to 9834, under the Michigan legislative retirement system act, Act No. 261 of the Public Acts of 1957, being sections 38.1001 to 38.1080 of the Michigan Compiled Laws. Upon the expiration of 12 months after the effective date of the amendatory act that added this subsection, 1957 PA 261, MCL 38.1001 to 38.1080. After March 31, 1998, rules and guidelines promulgated or processed under for the purposes described in this subsection are not effective and binding unless promulgated and processed in accordance with this act. |
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| 112 | 112 | | |
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| 113 | 113 | | Sec. 122. (1) "Contested case" means a contested case as defined in section 3, but does not include a case that is settled or in which a consent agreement is entered into or a proceeding for establishing a rate or approving, disapproving, or withdrawing approval of a form. |
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| 114 | 114 | | |
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| 115 | 115 | | (2) "Costs and fees" means the normal costs incurred, after a party has received notice of an initial hearing under section 71, in being a party in a contested case under this act, and include all of the following: |
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| 116 | 116 | | |
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| 117 | 117 | | (a) The reasonable and necessary expenses of expert witnesses as determined by the presiding officer. |
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| 118 | 118 | | |
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| 119 | 119 | | (b) The reasonable cost of any study, analysis, engineering report, test, or project that is determined by the presiding officer to have been necessary for the preparation of a the party's case. |
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| 120 | 120 | | |
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| 121 | 121 | | (c) Reasonable A reasonable and necessary attorney or agent fees fee, including those a fee for purposes of any appeal. |
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| 122 | 122 | | |
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| 123 | 123 | | (3) "Party" means a party as defined in section 5. , but does not include any of the following: |
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| 124 | 124 | | |
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| 125 | 125 | | (a) An individual whose net worth was more than $500,000.00 at the time the contested case was initiated. |
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| 126 | 126 | | |
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| 127 | 127 | | (b) The sole owner of an unincorporated business or any partnership, corporation, association, or organization whose net worth exceeded $3,000,000.00 at the time the contested case was initiated and that is not either exempt from taxation pursuant to section 501(c)(3) of the internal revenue code, 26 USC 501, or a cooperative association as defined in section 15(a) of the agricultural marketing act, 12 USC 1141j(a). |
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| 128 | 128 | | |
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| 129 | 129 | | (c) The sole owner of an unincorporated business or any partnership, corporation, association, or organization that had more than 250 full-time equivalent employees, as determined by the total number of employees multiplied by their working hours divided by 40, at the time the contested case was initiated. |
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| 130 | 130 | | |
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| 131 | 131 | | (d) As used in this subsection "net worth" means the amount remaining after the deduction of liabilities from assets as determined according to generally accepted accounting principles. |
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| 132 | 132 | | |
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| 133 | 133 | | (4) "Presiding officer" means an agency, 1 or more members of the agency, a person an individual designated by statute to conduct a contested case, or a hearing officer designated and authorized by the agency to conduct a contested case. |
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| 134 | 134 | | |
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| 135 | 135 | | (5) "Prevailing party" means either of the following, as applicable: |
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| 136 | 136 | | |
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| 137 | 137 | | (a) In an action involving several remedies, or issues or counts that state different causes of actions action or defenses, the party prevailing as to each remedy, issue, or count. |
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| 138 | 138 | | |
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| 139 | 139 | | (b) In an action involving only 1 issue or count stating only 1 cause of action or defense, the party prevailing on the entire record. |
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| 140 | 140 | | |
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| 141 | 141 | | Sec. 123. (1) The On stipulation of the parties or a motion under subsection (3), the presiding officer that who conducts a contested case shall award to a prevailing party, other than an agency, the costs and fees incurred by the party in connection with that the contested case, unless the agency demonstrates that the agency's position was substantially justifiable. However, subsection (2) applies in any of the following: |
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| 142 | 142 | | |
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| 143 | 143 | | (a) A proceeding involving illegal gambling and a licensee under the Michigan liquor control code of 1998, 1998 PA 58, MCL 436.1101 to 436.2303, to which the liquor control commission is a party. |
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| 144 | 144 | | |
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| 145 | 145 | | (b) A proceeding to which the department of health and human services is a party that relates to the child abuse and neglect central registry. |
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| 146 | 146 | | |
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| 147 | 147 | | (c) A licensing proceeding with respect to a summary suspension of the license that was required under section 92(2). |
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| 148 | 148 | | |
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| 149 | 149 | | (2) In a proceeding described in subsection (1), the presiding officer shall only award costs and fees under subsection (1) if the presiding officer finds that the position of the agency to in the proceeding was frivolous. To find that an agency's position was frivolous, the presiding officer shall must determine that at least 1 or more of the following conditions has been met:is applicable: |
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| 150 | 150 | | |
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| 151 | 151 | | (a) The agency's primary purpose in initiating the action was to harass, embarrass, or injure the prevailing party. |
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| 152 | 152 | | |
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| 153 | 153 | | (b) The agency had no reasonable basis to believe that the facts underlying its legal position were in fact true. |
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| 154 | 154 | | |
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| 155 | 155 | | (c) The agency's legal position was devoid of arguable legal merit. |
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| 156 | 156 | | |
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| 157 | 157 | | (3) (2) If the parties to a contested case do not agree on the awarding of costs and fees under this section, the prevailing party may file a motion for costs and fees. On a motion under this subsection, the presiding officer shall hold a hearing shall be held if requested by a party, regarding the awarding of costs and fees. and the amount thereof. The party seeking an award of costs and fees shall must present evidence establishing all of the following: |
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| 158 | 158 | | |
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| 159 | 159 | | (a) That If subsection (2) applies, that the position of the agency was frivolous. |
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| 160 | 160 | | |
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| 161 | 161 | | (b) That the party is a prevailing party. |
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| 162 | 162 | | |
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| 163 | 163 | | (c) The amount of costs and fees sought. including The party shall present an itemized statement from any an attorney , or agent , or who represented the party and any expert witness who represented the party showing the rate at which the costs and fees were computed. |
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| 164 | 164 | | |
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| 165 | 165 | | (d) That the party is eligible to receive an award under this section. Financial records of a party shall be are exempt from public disclosure if requested by the party so requests at the time the records are submitted pursuant to under this section. |
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| 166 | 166 | | |
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| 167 | 167 | | (e) That a final order that is not subject to further appeal other than for the judicial review of costs and fees provided for in section 125 has been entered in the contested case regarding the subject matter of the contested case. |
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| 168 | 168 | | |
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| 169 | 169 | | (4) (3) The presiding officer may reduce the amount of the costs and fees to be awarded under this section, or deny an award, to the extent that the party seeking the award engaged in conduct which that unduly and unreasonably protracted the contested case. |
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| 170 | 170 | | |
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| 171 | 171 | | (5) (4) The final action taken by the presiding officer under this section in regard to costs and fees shall must include written findings as to that the action and the basis for the findings. |
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| 172 | 172 | | |
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| 173 | 173 | | (6) (5) Subject to subsection (6), (7), the amount of costs and fees awarded under this section shall must include those reasonable and necessary costs actually incurred by the party and any costs allowed by law or by a rule promulgated under this act. Subject to subsection (6), (7), the amount of fees awarded under this section shall must be based upon on the prevailing market rate for the kind and quality of the services furnished, subject to the following: |
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| 174 | 174 | | |
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| 175 | 175 | | (a) The expenses paid for an expert witness shall must be reasonable and necessary as determined by the presiding officer. |
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| 176 | 176 | | |
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| 177 | 177 | | (b) An attorney or agent fee shall not be awarded at a rate of more than $75.00 per hour unless the presiding officer determines that special circumstances existed justifying a higher rate or an applicable rule promulgated by the agency provides for the payment of a higher rate because of special circumstances.must be a reasonable attorney fee as determined by the presiding officer following applicable supreme court precedent. |
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| 178 | 178 | | |
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| 179 | 179 | | (7) (6) The presiding officer shall only award costs and fees awarded under this section shall only be awarded to the extent and amount that the agency caused the prevailing party to incur those costs and fees. |
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| 180 | 180 | | |
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| 181 | 181 | | (8) (7) This section does not apply to any an agency in its role of hearing or adjudicating a case. Unless an agency has discretion to proceed, this section does not apply to an agency acting ex rel on the information and at the instigation of a nonagency person who that has a private interest in the matter nor or to an agency required by law to commence a case upon on the action or request of another nonagency person. |
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| 182 | 182 | | |
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| 183 | 183 | | (9) (8) This section does not apply to an agency that has such a minor role as a party in the case in comparison to other nonprevailing parties so as to make its liability for costs and fees under this section unreasonable, unjust, or unfair. |
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| 184 | 184 | | |
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| 185 | 185 | | Enacting section 1. This amendatory act takes effect 90 days after the date it is enacted into law. |
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| 186 | 186 | | |
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| 187 | 187 | | Enacting section 2. This amendatory act does not take effect unless Senate Bill No.____ or House Bill No. 6073 (request no. 05870'24) of the 102nd Legislature is enacted into law. |
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