The city shall possess and hereby reserves to itself all the powers granted to cities by statute and constitution to acquire, construct. own, operate, improve, enlarge, extend, repair and maintain, either within or without its corporate limits, including but not by the way of limitation, public utilities for supplying water, light, heat, power, gas, communications, sewage treatment and garbage disposal facilities, or any of them, to the municipality and the inhabitants thereof and also to sell and deliver water, light, heat, power, gas and other public utility services without its Corporate limits to an amount end to a territory not exceeding the limitation set by statute and constitution. 

Section 11.02 Management of Municipally Owned or Operated Utilities 

Each municipally owned or operated utility shall be administered as a regular department of the city government under the management and supervision of the City Manager.

Section 11.03 Rates

The council shall have the power to fix from time to time just and reasonable rates and other charges as may be deemed advisable for supplying the inhabitants of the city and others with such public utility services as the city may provide. The rates and charges of an municipal public utility for the furnishing of water, light, heat, communications, power or gas shall be so fixed as to at least meet all the costs of such utility. There shall be no discrimination in such rates within any classification of users thereof. nor shall free service be permitted. but higher rates may be charged for service outside the city limits.

The council shall provide by ordinance for the collection of all public utility rates and charges of the city. Such ordinance shall provide at least; 

(a) That the city shall have as security for the collection of such utility rates and charges a lien upon the real property supplied by such utility, which lien shall become effective immediately upon the supplying of such utility service and shall be enforced in the manner provided in such ordinances and subject to the provisions of MCLA 123.165 and MCLA 141.121.

(b) The terms and conditions under which utility services may be discontinued in case of delinquency in paying such rates or charges;

(c) That suit may be instituted by the city in any competent tribunal for the collection of such rates or charges. With respect to the collection of rates charged for water the city shall have all the powers granted to cities by Act 178 of the Public Acts of 1939.

Unless approved by a three-fifths majority vote of the electors voting thereon at a regular or special election, the city shall not sell, exchange, lease or in any way dispose of any property, easements, equipment, privilege or asset belonging to and appertaining to any municipally owned public utility which is needed to continue the operation of such utility. All contracts, negotiations, licenses, grants, leases or other forms of transfer in violation of this section shall be void and of no effect as against the city. The restriction of this section shall not apply to the sale or exchange of articles of machinery or equipment of any city owned public utility which are worn out or useless or which have been or could with advantage to the service be, replaced by new and improved machinery or equipment, to the leasing of property not necessary for the operation of the utility, or to the exchange of property or easements for other needed property or easements.

Separate accounts shall be kept for each public utility owned or operated by the city. Such accounts for utilities for the furnishing of water, light, heat, communications, power or gas shall be designed to show the financial results of city ownership, or operation in the same manner as the financial results of a corresponding privately-owned utility would be shown, except that taxes need not be accounted for. To that end the accounts: shall show all assets, liabilities, revenues, expenses, reserves and surplus.

The rates and charges for any municipal public utility for the furnishing of water, light, heat, communications, power or gas shall be so fixed as to at least meet all the costs of such utility.

There is hereby established a fund to be known and designated as the "Electric Utility Reserve and Contingency Fund" (hereinafter referred to in this section as the "Fund") to which transfers shall be made as set forth herein. Funds transferred shall be expended only on capital replacement or expansion or major repairs and improvements to the utility costing more than $25,000.00 and necessitated by deterioration or obsolescence of existing utility facilities and equipment and for major repairs and replacements necessitated because of damage by the elements or any other accidental cause.

(a) The City Council shall allocate to said Fund a sum total ten per cent (10%) of the Electric Utility's net earnings during the previous fiscal year but not less than $10,000.00. The net earnings of the utility shall be that sum remaining after the expenses of operation and normal maintenance are met, and before transfers are made to other city funds for other than charges outstanding against the utility.

(b) The annual transfer to the fund hereby established shall continue until said Fund shall reach the sum of Two Hundred Fifty Thousand Dollars ($250,000.00). Provided, however, that when expenditures are authorized under the provisions hereinbefore described, and the Fund is wholly or partially depleted, the annual transfers from utility revenues will be resumed until the full fund maximum is restored.

(c) The Fund shall be invested, within statutory limits, in U. S. Government Bonds or other securities of equal safety. Accrued interest shall remain in the Fund until the Fund maximum is reached, after which the interest shall revert to the General Fund.

(d) The Council for the City shall have the authority to increase, but not to decrease, the above noted dollar amounts as they deem necessary.