When can community college be contracting agent in Michigan?

Author: LegalEase Solutions

Research under the Prevailing Wage Act

Question Presented

Will a community college be a “contracting agent” under PWA?

Short Answer

A community college is not a “board or commission of the state” but may be a “state institution” under the Prevailing Wage Act’s definition of “Contracting Agent.”

Analysis

  1. A community college is not a “board or commission of the state” but may be a “state institution” under the Prevailing Wage Act’s definition of “Contracting Agent.”

MCL § 408.551(c) defines a “contracting agent” as:

“Contracting agent means any officer, school board, board or commission of the state, or a state institution supported in whole or in part by state funds, authorized to enter into a contract for a state project or to perform a state project by the direct employment of labor.”

In order to determine whether a community college would classify as either a “board or commission of the state” or a “state institution supported in whole or in part by state funds” under the PWA, reference to other statutes may provide guidance.  For e.g., MCL § 2.161 (placement of national motto).  MCL § 2.161, which is an act to strongly encourage state agencies and units of local government to exercise their constitutional ability to place the national motto in or on public buildings or land in the state, provides the following definitions:

“Sec. 1. As used in this act:

(a) “State agency” means a department, board, commission, office, agency, authority, or other unit of state government. State agency includes a state institution of higher education.

(b) “Unit of local government” means a political subdivision of this state, including school districts, community college districts, intermediate school districts, public school academies, cities, villages, townships, counties, and authorities, if the political subdivision has as its primary purpose the providing of local governmental service for citizens in a geographically limited area of the state and has the power to act primarily on behalf of that area.” (emphasis added)

See also, MCL § 28.754 (Michigan Amber Alert Act: “As used in this section: (a) ‘Local unit of government’ means: . . . (iv)  A community college).

In these definitions, a community college is defined as a “local unit of government,” not an agency, institution, board or commission of the State.

In addition, when educational institutions are sued in the Court of Claims jurisdiction is limited to universities and colleges created by constitution or statute as state-wide institutions, and does not extend to educational institutions providing primarily local services by locally elected boards.  Doan v. Kellogg Community College, 80 Mich App 316 (Mich. Ct. App. 1977).  Doan involved a personal injury action brought by a student against a community college.  The issue before the court was whether the community college was a state agency for which the court of claims had exclusive jurisdiction or rather a locally run agency, created for serving the local community.  Id. at 318.  The court held that the jurisdiction of the Court of Claims was limited to those universities and colleges that are created by the constitution or statute as state-wide educational institutions and not those educational institutions which provide primarily local services by boards elected locally. Id. at 322. The court further held that the community college district in question was the same as an intermediate school district. Id.  The very purpose of the community college is essentially local, i.e., to provide education to persons in the community. Id.  In this regard, the decision to create the community college district was based on a vote of the people in the intermediate school district and the board of trustees of the community college was elected locally.  Id.  Moreover, the tax rate for financing the school was determined by a local vote.  Id.  Therefore, community colleges serve primarily residents in their own district and the intent of the legislature to keep community colleges as local was evident from the fact that an additional fee is charged by the college for enrolling nonresidents.  Id.

We note that the convention notes to Michigan Const. 1963, Article 8, §7 state that the section requires “the legislature to provide by law for the establishment and financial support of public community and junior colleges to be operated by locally-elected boards of control.”

Accordingly, based upon statutory definitions, the legislative notes to Article 8, §7  and the court’s interpretation of a community college, it would appear that a Michigan community college is not a “board or commission of the state,” but rather, is considered a local unit of government operating independently of the state.

However, there is support for the conclusion that a community college is a “state institution supported in whole or in part by state funds.”  See United States ex rel. Diop v. Wayne County Cmty. College Dist., 242 F. Supp. 2d 497 (E.D. Mich. 2003).  In Diop, the question before the Federal District Court for the Eastern District of Michigan was whether a community college could invoke the State’s sovereign immunity under the Eleventh Amendment. Id. at 527.  The District Court found that the Legislature appropriated funds for every community college in the State of Michigan.  Id.  Because State funding amounted to 1/3 of the community college’s revenue, any damages award against it would invade the state treasury. Id.  Furthermore, the community college was created by the State and was subject to the comprehensive State statutory scheme governing the operations of community colleges.  Id.  Therefore, the community college was considered to be an arm of the state and therefore enjoyed immunity under the Eleventh Amendment.  Id. at 128.  See also, Southeastern Community College v. Davis, 442 U.S. 397 (1979) (recognizing Community Colleges as state “institutions”).

Further supporting the conclusion that a community college is a “state institution” is the convention notes to Michigan Const. 1963, Article 8, §7 which state that § 7 authorizes the legislature to “provide for a state board for public community and junior colleges which will advise the state board of education as to general supervision, planning and appropriations for such colleges. The board of eight members, serving eight-year terms, is to be appointed by the state board of education.” (emphasis added).

Pursuant to Michigan Const. Art. VIII, § 3 (State board of education; duties), “[l]eadership and general supervision over all public education, including adult education and instructional programs in state institutions, except as to institutions of higher education granting baccalaureate degrees, is vested in a state board of education. It shall serve as the general planning and coordinating body for all public education, including higher education, and shall advise the legislature as to the financial requirements in connection therewith.”  (emphasis added).

Therefore, the state not only funds community colleges, but the state board of education has supervision and oversight over community colleges including the appointment of a state board for public community and junior colleges.  As such, there is support for the conclusion that Michigan community colleges are “state institutions.”  See generally, Council of Orgs. & Others for Educ. About Parochiaid v. Governor, 455 Mich. 557 (1997) (if a public school academy meets the qualifications set by the Legislature for state funding, and the Legislature has the authority to prescribe what officers should be chosen to conduct the affairs of the school districts, to define their powers and duties, their term of office, and how and by whom they should be chosen, it qualifies as a public school).

Conclusion

There is nothing to support the conclusion that a Michigan community college is a “board or commission of the state” since community colleges are defined as a “local unit of government.”  However, a community college is funded by the state and is supervised and overseen by the state Board of Education possibly making it a “state institution supported in whole or in part by state funds.”