Mich. Comp. Laws § 106.6
The board of public works shall annually, on or before the first Monday in June, establish a scale of rates to be charged and paid for supply of water for the year next ensuing, to be called water rates, which rates shall be approved by the council and shall be appropriate to different classes of buildings in the city, with reference to their dimensions, value, exposure to fires, ordinary or extraordinary uses for dwellings, stores, shops, hotels, factories, livery stables, barns and all other buildings, establishments and trades, yards, number of families or occupants or consumption of water, as near as may be practicable, and from time to time, either modify, amend, increase or diminish such rates.
The board of public works, with the approval of the council, is hereby authorized to enter into any contract or contracts for the sale and delivery of water without the corporate limits of the city to an amount not to exceed 25 per cent of the water furnished by said board within the corporate limits of the city. Said board is hereby authorized to prescribe such terms and conditions in any such contract as shall be agreed upon.
MCL 106.6