Application by municipality to Secretary of Office of Policy and Management for designation as tier III municipality. Conditions. Notice to legislative body. Approval or rejection by legislative body. Designation by secretary. Referral to Municipal Accountability Review Board. Timing for designation.

(b) Any municipality that (1) receives a bond rating below investment grade from a rating agency, (2) issues refunding bonds that (A) have a term of more than twenty-five years, (B) do not achieve net present value savings pursuant to the provisions of section 7-370c , and (C) have annual debt service obligations associated with any existing debt and such refunding bonds in any year that are greater than the first full year debt service obligation following the issuance of such refunding bonds, or (3) issues a deficit obligation shall be designated as a tier III municipality. Any municipality that meets one or more conditions described in subdivisions (1) to (3), inclusive, of this subsection, shall notify the secretary not later than ten days after having met such condition or conditions. (c) The Municipal Finance Advisory Commission may, after holding at least one meeting with a designated tier I municipality, recommend to the secretary that such municipality be designated as a tier III municipality. Any such recommendation shall be made on the basis of such municipality's financial condition, which shall be documented by the commission in a report submitted to the secretary. A copy of such report shall be provided to such municipality not later than ten days after such submission. Not later than forty-five days after such submission, the secretary may approve or reject such recommendation. If the secretary does not approve or reject such recommendation during such forty-five-day period, such recommendation shall be deemed rejected. (d) The secretary shall refer any municipality that is a designated tier III municipality to the Municipal Accountability Review Board established pursuant to the provisions of section 7-576d .