Governor Snyder Signs Recreational Authorities Bill with Support from Big Rapids and League

The League's Chris Hackbarth and League Member and Big Rapids Mayor Mark Warba (green tie) joined Governor Rick Snyder in signing HB 4578.

The League’s Chris Hackbarth and League Member and Big Rapids Mayor Mark Warba (green tie) joined Governor Rick Snyder in signing HB 4578.

Today, the Michigan Municipal League’s Chris Hackbarth and League Member and Big Rapids Mayor Mark Warba joined Governor Rick Snyder in signing House Bill 4578.

The new law clarifies the use of tax proceeds by a recreational authority and is expanded to include school districts. Working in conjunction with officials from the City of Big Rapids, the League was successful in getting the legislation approved with support from bill sponsors Sen. Darwin Booher, R-Evart; and Rep. Phil Potvin, R-Cadillac. View a previous blog about the legislation here.

The legislation, modeled on similar legislation from previous sessions, expands the definition of an eligible municipality to include a school district. This change also allows a city, village, or township to partner with a school district to form a recreation authority allowing broader access to recreation programming and facilities throughout a region.

Thank you to Mayor Warba and other Big Rapids area officials for their support on this bill! We also like to thank bill sponsors Sen. Darwin Booher, R-Evart; and Rep. Phil Potvin, R-Cadillac.

Matt Bach is director of media relations for the Michigan Municipal League. He can be reached at mbach@mml.org and 734-669-6317.

House Shelves Plans for OPEB Reform During Lame Duck

During an early morning hearing today, the House Local Government committee deferred action on comprehensive retiree health care reform (OPEB) until next term.  The only bill in the original 13-bill package to see any further debate was House Bill 6075, a bill focused on reporting/transparency of retiree pension and health liabilities. This bill was reported from the committee and awaits action on the House floor.

The Michigan Municipal League has long cited the need to address the high cost of retirement health insurance while maintaining options for health care for municipal retirees. Although the League offered conceptual support for this proposal, the complexity of the issue makes it difficult to thoroughly consider during the lame duck environment.  For that reason, the League requested the House delay action on this proposal and allow for the opportunity to work with Gov. Rick Snyder, the incoming Legislature, and all of the relevant interest groups in the next term.

Over the course of the current legislative term, the League has pursued a comprehensive policy agenda aimed at reforming Michigan’s broken municipal finance system.  The agenda involves reform to cost drivers, restoration and diversity of revenue options, and the reviewing the structure of local government. Thoughtful OPEB reform remains an important component of the League’s municipal finance initiative, which we will continue to pursue in the new year.

Chris Hackbarth is the League’s director of state affairs. He can be reached at 517-908-0304 and chackbarth@mml.org.

21st Century Infrastructure Commission Report Released

Today the 21st Century Infrastructure Commission released a 188-page report on improving Michigan’s infrastructure and strengthening our economy. The reports Vision Statement is as follows: Michigan will lead the nation in creating a 21st Century infrastructure system that will include innovative technology, sustainable funding solutions, sound economic principals and integrated asset management and investment approach that will enhance Michiganders’ quality of life and build strong communities for the future.

The report highlights that a 21st Century Michigan is one where the state’s infrastructure system supports economic prosperity, promotes a healthy environment, provides reliable and high quality services and ensure we get the most value from limited financial resources. To maintain Michigan’s status as a global leader the report suggest that we must look at infrastructure in an integrated and holistic way. This means further promoting asset management, coordinated planning, sustainable funding and emerging technologies.

Recommendations within the report are focused in four key areas: Water, Transportation, Energy and Communications. In each of these categories there are many issue that impact our communities. A few key recommendations within this reports are continued investment in green infrastructure, rightsizing our roadways with a focus on placemaking, offering more robust nonmotorized transportation options and investment in transit across Michigan.

The bottom line is that this will cost money. The report indicates that Michigan will need an additional $4 billion per year, and $60 billion over the next 20 years, to meets the needs of our transportation, water, energy and communication infrastructure. A mix of sources will be relied on for these funding increases including federal, state and local funding, user fees and private investment. An important takeaway is that the report suggests giving more authority to locals to raise the funds necessary to maintain their infrastructure. Some of the suggestions offered are a local gas tax, local registration fee, local sales tax or impact fees from land developments that burden road systems.

The 21st Century Infrastructure Reports was designed to identify the scope of the problem and offer a menu of options to solve that problem. There is no question that the need for further investment exists, and the desire of the Governor and the Commissioners that put this report together is to begin working on those solutions immediately.

For the Executive Summary click here, for the full report click here.

John LaMacchia is the Assistant Director of State and Federal Affairs for the League handling transportation, infrastructure, energy and environment issues. He can be reached at jlamacchia@mml.org or 517-908-0303.

Lame Duck Legislative Work Underway; Sign up for Inside 208 Updates!

subscribe-here-arrowThe Lame Duck session of the state Legislature is in full swing and there are a number of key issues potentially impacting your communities that the Michigan Municipal League is working on and watching. WE MAY NEED YOUR HELP over the next several days as the Legislature currently has session scheduled through Dec. 15.

For regular updates on what is happening, the League strongly encourages you to sign up to receive email alerts from our Legislative blog, Inside 208. Please go here and sign up in the “subscribe” box on the right side of the page by typing in your email address. This is a free service provided to League members and you will receive emails each time a new Inside 208 blog is posted about the latest Legislative activity happening in Lansing. As issues arise, the League will be posting regularly on Inside 208 and we may be asking you to contact your Legislators on various bills.

Currently, there are multiple pieces of legislation the League is following that could have both a positive and/or a negative impact on your communities.

Some of major issues we have blogged about so far include bills to reform Other Post-Employment Benefits (OPEB) or retirement health care, changes to Tax Increment Finance (TIF) Authorities, a bill that limits local control on transportation network companies and taxis (think Uber and Lyft), new economic development tools, and potential energy reform.

Please help us by signing up to receive our Inside 208 blog emails during this quickly-moving, ever-changing Lame Duck legislative sessions.

Matt Bach is director of media relations for the Michigan Municipal League. He can be reached at mbach@mml.org and 734-669-6317.

House Passes Six Bill TIF Reform Package Yesterday

House bills 5851-5856 are headed to the Senate for consideration. The six bill package which severely hinders a Downtown Development Authority and other TIF authorities ability to capture special millages was voted out of the House yesterday afternoon.

Language in this package defining what a new special millage is considered is vague. As the language is currently written, it will be easy to qualify existing special millages as new to avoid TIF authorities from capturing dollars needed to cover existing debt and other obligations. The League will continue to work to have the language amended and post updates as we have information to report.

Jennifer Rigterink is a legislative associate for the League handling economic development, land use and municipal services issues.  She can be reached at jrigterink@mml.org or 517-908-0305.

Local Rail Grade Crossing Surface Funds

A new funding source, sought by Michigan railroads, is available beginning winter 2017 to local road agencies for improving rail grade crossing surfaces on roads under the jurisdiction of the county road agency/department, cities or villages. Projects utilizing
the Local Grade Crossing Surface Account will be 60 percent covered by the account, with the remaining 40 percent being funded by the railroad company.

The legislative intent of this Act 51 carve-out is to provide financial assistance for railroads to improve crossings on active rail lines.In 2017, $3 million will be made available for local rail grade crossing projects.

Eligibility: Eligible projects are limited to crossing repair work that is normally the responsibility of the railroad in accordance with PA 354 of 1993.

How to Prepare:  Get an estimate for improving the crossing from the railroad company responsible for it. Be sure they agree to pay 40 percent of the overall project. Make sure ADTs (average daily traffic) are accurate and up to date.

How to Submit: MDOT’s new application will be available in December 2016. The form will look similar to the application used on the warning device safety improvement program. It will be a simple one-page form, and will be released with submission instructions.

Timeframe: Once the estimated one-month submission window closes, local road agencies can expect to hear about applications within a month. MDOT expects to
authorize projects 4-8 weeks after project selections are made.

Projects are Prioritized Based on:

  1. Validated vehicular traffic volume (ADT);
  2. Relative surface condition (RSC);
  3. Ability of local agency and railroad to coordinate repairs with adjacent road work: and
  4. The availability of funding

Projects will be ranked by ADT and RSC. After the top candidate in both categories within each MDOT Region has been selected, the next-in-line projects statewide will be funded until applications or annual budget is exhausted.

Please click on the following link for the Michigan Railroads Association Surface Grade Crossing Railroad Contact list. click-here

John LaMacchia is the Assistant Director of State and Federal Affairs for the League handling transportation, infrastructure, energy and environment issues. He can be reached at jlamacchia@mml.org or 517-908-0303.

Senate Eliminates Local Control over Transportation Network Companies and Taxi Carriers

File illustration picture showing the logo of car-sharing service app Uber on a smartphone next to the picture of an official German taxi signIn a move to place Transportation Network Companies (TNCs), such as Uber and Lyft, limousines and taxi carriers, all under one regulatory framework, the Senate passed HB 4637 by a vote of 31-4. In doing so, the Legislature stripped all local control municipalities currently have over taxi carriers. Regulation of these entities will now be handled by the Department of Licensing and Regulatory affair.

Under this new regulatory framework each entity is required to register with the department, complete a vehicle safety inspection if the vehicle is 5 years old or older, post proper signage on the vehicle, ensure each driver has passed a criminal background check and obtained proper insurance.

Municipalities will only be allowed to enforce certain provisions of this act by issuing civil infractions if the vehicles fail to display the proper signage, the driver doesn’t have proper insurance, if a TNC attempts to solicit a passage through a method other than their digital platform, or if a driver fails to provided a ride to an individual due to discrimination.

The League testified in opposition to the elimination of local control citing several concerns about public safety and the ability for the department to adequately enforce the new provisions within this bill. Amendments to protect a communities ability to stipulate hours of operation, and the location and operation of taxi stands were defeated. Senator Hertel was able to secure an amendment on behalf of the League to ensure taxi authorities created before this act will be able to remain in operation for a period of 4 years.

This bill has been returned to the House where it is anticipated they will concur in the Senate changes and send the bill to the Governor for his signature. We also anticipate that the Governor will sign this legislation.

John LaMacchia is the Assistant Director of State and Federal Affairs for the League handling transportation, infrastructure, energy and environment issues. He can be reached at jlamacchia@mml.org or 517-908-0303.

TIF Package Scheduled for House Floor Vote Today – Action Needed

House bills 5851-5856 which require TIF authorities to undertake additional transparency and reporting requirements, as well as eliminate the capturing of special millages after December 31, 2016, is scheduled for a vote in the House today.

The League has been very involved working to make sure that new transparency and accountability measures are palatable. We are very concerned with the language in this package that defines what a new special millage is. As outlined within this package currently, it will be very easy to take an existing special millage and qualify it as a new special millage to avoid TIF authorities from capturing. We have been told this is not the intention of the provision in the bills, yet the definition language has not been amended to clarify.

Contact your State Representative now to urge them to vote no on House bills 5851-5856 which will block tax capture of not just new millages, but most likely all renewed or revised millages.

Jennifer Rigterink is a legislative associate for the League handling economic development, land use and municipal services issues.  She can be reached at jrigterink@mml.org or 517-908-0305.

OPEB Reform Proposal on Lame Duck Agenda

The League's Anthony Minghine (left) and Chris Hackbarth (right) testify on the OPEB reform effort Thursday in the state House Committee on Local Government.

The League’s Anthony Minghine (left) and Chris Hackbarth (right) testify on the OPEB reform effort Thursday in the state House Committee on Local Government.

The bills, House Bills 6074-6086 went before the House Local Government committee today – Thursday (Dec. 1, 2016) at 10:30 a.m.

League staff were given an opportunity to testify on the bills this morning and supported the concept of what the bills aim to do. League staff were briefed on this proposal just prior to the bill introduction and it may move through the process during lame duck.

Governor Snyder’s administration, while preferring to deal with this issue next year as part of a comprehensive conversation, recognizes that this is a major issue and is likely to support it. View a Detroit Free Press article about the hearing here.

During the hearing, the League’s Chris Hackbarth and Anthony Minghine were given an opportunity to testify. The hearing recessed Thursday with no vote cast and resumed later in the afternoon and Hackbarth and Minghine were able to finish testifying. The Michigan Association of Counties and Michigan Townships Association also testified in the afternoon in support of the OPEB reform effort in concept. At the end of Thursday’s hearing, the committee chair, Lee Chatfield, R-Levering, urged people to read the package of bills over the weekend. Chatfield indicated the committee would likely continue the discussion on the issue next week.

“This is a great first step and we look forward to continuing the discussion,” said Hackbarth, director of state affairs for the League. “We support giving additional tools to our communities. (These bills) will allow additional local control.”

Minghine, the League’s COO and associate executive director, added: “We need a model that is sustainable. At first blush we are encouraged by where this package goes.”

The League has expressed concerns about dealing with this in such a short window, and expect that if this proposal is adopted there may be a need for follow-up legislation in the next session to address any issues that arise.

In summary:

The League's Chris Hackbarth testifies on the OPEB reform package of bills discussed in a state House committee Thursday.

The League’s Chris Hackbarth testifies on the OPEB reform package of bills discussed in a state House committee Thursday.

  • The proposal consists of 13 bills, solely focused on retiree health care. There is no proposal to address municipal pension systems.
    • 4 main bills and 9 trailer bills that will simply refer back to the changes made in the initial 4 bills
    • 4 main bills will provide for a new act that specifies allowable retiree health benefits, a transparency/reporting bill, a PERA bill, and an amendment to PA 312 binding arbitration
  • PERA amendment would state that retiree health benefit offerings are a prohibited subject of bargaining.
  • PA 312 amendment would prohibit an arbitrator from issuing an order that includes retiree health benefits.
  • There is a trigger mechanism in the proposal so that it would only impact municipalities with a GASB-defined actuarially funded level for OPEB below 80%.  No requirement for pre-funding for any community, regardless of current unfunded liability.
  • Package would address retiree health offering according to the type of employee
    • New hires after effective date could only be offered an employer contribution of a maximum of 2% of compensation towards a retirement health savings account. This offering is at the employers discretion.
    • Existing employees who do not retire before expiration of current contract would be subject to a minimum cost share of 20% of their retirement health benefit. The specific cost share would be set by the city. Extensions or renewals of existing contracts could not include retiree health benefit offerings outside of the 80/20 cost share.
    • For existing retirees, this same 80/20 cost share would be in effect, to the extent that the agreement they retired under does not offer a “vested” right to that benefit. This is a concept that is based in current case law and would allow changes to some, but not all retirees.
  • Once a retiree qualifies for Medicare, the municipality could only offer to cover a Medicare supplemental insurance product at the same 80/20 cost share level.
  • Retirees would be ineligible to receive health insurance coverage from the municipality if health insurance coverage is available from another employer subsequent to their retirement from the municipality.
  • Based upon the remaining session schedule, a bill introduction on 11/30/16 would require committee action immediately following introduction with floor action in the House not eligible until 12/6/16 at the earliest.  If the House moves the bills during the session week of 12/6-12/8, the bills would not be eligible to move in the Senate until the following week…12/13-12/15.
  • The bill package would have an effective date starting May 1 of 2017.

The League’s Board of Trustees was briefed on this proposal and while we continue to review the legislation the issue of OPEB reform has been a central component of the League’s municipal finance initiative and we testified in committee today in support of the concept of such reform.

Chris Hackbarth is the League’s director of state affairs. He can be reached at 517-908-0304 and chackbarth@mml.org.

 

Community Solutions Council

Last week the White House announced President Obama’s Executive Order establishing a Community Solutions Council. This effort builds upon the 2015 Community Solutions Task Force and will be a platform across federal agencies to strengthen relationships with local governments and local government partners. See below for additional information.

Read the White House Press Release

Read the Community Solutions Fact Sheet

Visit the Community Solutions Initiative website

Jennifer Rigterink is a legislative associate for the League handling economic development, land use and municipal services issues.  She can be reached at jrigterink@mml.org or 517-908-0305.