Governor’s Infrastructure & Environment Week Recap

Last week Governor Snyder followed up his January State of the State address with daily, detailed announcements on each of the proposals from his speech.

Each day featured one of the Governor’s priority areas of infrastructure and the environment.  See the attached documents to learn more about what was announced.

Monday’s topic was Ubiquitous Broadband Access and Adoption.  You can read more about this here: Monday.Broadband

Tuesday’s topic was Renewing our Environment.  This proposal was announced as a replacement for the former Clean MI Initiative bonds and would replace the former bond proceeds with an increase in solid waste tipping fees, up to $4.75/ton.  More information regarding this initiative can be found here:

Renew Michigan’s Environment;

Tuesday.Renew.Michigans.Environment_

CMI_Bond_OneSheeter,

3000 Sites to be Addressed 1 31 18

Wednesday covered Protecting our Waterways, along with this web site to help bolster this initiative (www.BlockAsianCarp.org).

Thursday’s topic was Rebuilding Michigan’s Water Infrastructure.  This proposal is centered around a $5/resident user fee on public water systems.  Find out more details about this here:

Thursday.Water.Infrastructure;

Rebuild MI Water Infrastructure;

CommunityWaterSupplies_FINAL

Friday covered Protecting our Environment and Achieving our Recycling Rate Goals. Find out more here: Friday.Recycling

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.

 

 

 

Governor Announces Plan to Rebuild Michigan’s Water Infrastructure

The League attend a briefing with the Governor this morning where he laid out his plan to rebuild Michigan’s water infrastructure. The plan is centered around a $5 annual fee per resident that would begin in 2020, have a five-year phase-in period, and sunset in 2040. It is expected to generate $110 million in annual revenue. As a way to ensure that those being charged will receive direct benefit, 80 percent of the revenue generated from the fee will be expended in the region in which it was generated.

The $110 million will be utilized to fund three key areas: Integrated Asset Management ($25M), State Capital Investment Program ($75M), and Emergency Infrastructure Failure ($10M).

At the briefing, we were provided with the framework of the proposal but many of the specific details need to be worked out, and ultimately the legislature will need to approve it. You can see the documents that were presented to us by clicking the following two links:

Water Infrastructure Info Graph

Proposal to Rebuild Michigan’s Water Infrastructure

While at the meeting, the League made it a point to express our appreciation to the Governor for his efforts to invest in water infrastructure, but illustrated that this is only one component of local government and that we need to continue to work on our overall fiscal stability. We also highlighted the need for continued investment in communities because the creation of great places is the key component in attracting talent, which leads to attracting business.

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.

Governor Continues Week of Policy Announcements

Following Governor Snyder’s eighth and final State of the State speech last week, his team has immediately moved into announcement mode, capitalizing on the initiatives he announced during his January 23rd speech to the Legislature.

A new announcement is planned for each day this week, in advance of next Wednesday’s (Feb 7th) FY 2018-19 state budget presentation.

On Monday, the Governor signed Executive Order 2018-2 in Port Huron, promoting the expansion of broadband internet service.  This E.O. creates a new state-level commission, the Michigan Consortium of Advanced Networks, to advise the Governor on the state’s broadband infrastructure needs, identifying gaps in coverage and capacity and recommending solutions for state and private sector investment to bridge those gaps.

On Tuesday, the Governor announced his Renew MI plan as a replacement for the former Clean Michigan Initiative bond program.  This $675 million bond program, approved by the state’s voters in the late ’90s, is nearly tapped of remaining bond capacity, so the Governor is proposing an increase in landfill tipping fees as a replacement for that bond revenue to avoid adding to the state’s long-term debt liabilities.  This new proposal would increase the tipping fee from the current .36/ton to $4.75/ton as a way to bring in an estimated $79 million per year to clean up contaminated sites, invest in recycling programming, assist with local solid waste management planning, and support ongoing water quality monitoring efforts at beaches, lakes, and rivers.

Wednesday’s announcement centers around efforts to curb invasive species, like Asian Carp from entering the Great Lakes.  On Thursday, the Governor is expected to announce his plans for investment in the state’s water infrastructure systems.  Finally, on Friday he is scheduled to detail his specific proposals for improving the state’s recycling efforts.

League staff have participated in briefings on these announcements and are reviewing the available information and awaiting the forthcoming announcements to determine the various impacts on local governments.  We will share additional details as the remaining initiatives are announced later this week.

Please contact our office if you have any questions.

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

Apply Now: Better Streets, Better Michigan Award

The Michigan Department of Transportation and the Michigan Municipal League are excited to announce the 2018 Better Streets, Better Michigan Award. This award recognizes Michigan cities and villages that have undertaken creative road projects. These projects should be aimed at improving the function and aesthetics of a busy street for a variety of transportation modes – cars, bikes, and pedestrians. Examples include road diets, complete streets projects, and similar investments within existing rights of way. The street must be one of the community’s main roadways that was primarily auto-centric at the start of the project.

The award will be judged on:

  • Employing creativity
  • Achieving a positive impact on the community’s economic development and placemaking
  • Partnering with transportation agencies and stakeholders
  • Developing a street project replicable by other communities

Projects accomplished through a team effort between a city or village and MDOT or a local or regional transportation agency are eligible to receive this award. The MDOT Performance Excellence Section will be accepting applications for the award through Feb. 16, 2018. To be eligible, a project must be substantially complete and ready for use between Jan. 1, 2015 and Dec. 31, 2017. The 2018 award will be announced at the Michigan Municipal League Capital Conference in Lansing on March 21, 2018.

  • Better Streets, Better Michigan Award brochure.
  • Better Streets, Better Michigan Award entry form.

Submit the completed entry form in PDF format. For any questions or concerns, please contact: Brad Peterson at 517-719-7318 or petersonB3@michigan.gov.

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.

Year-End Legislative Wrap-Up

While last week’s House and Senate adjournment merely marks the mid-point of this two-year legislative session, that did not mean that the Legislature coasted into their holiday break.

Highlighted by the intense activity surrounding OPEB reform, both legislative chambers pursued aggressive agendas in the final days before adjourning.  Numerous bills that the League was tracking and engaged with experienced some measure of action:

The now 13-bill OPEB package was signed by Governor Snyder this week as Public Acts 202-214 of 2017 and takes effect immediately.  New reporting requirements under the bill are expected to be phased in over the next year, with some reporting expected due as early as January 31, 2018.  The League will work to update member communities as more information becomes available in the next couple of weeks.

Senate Bill 110 clarifies that municipalities implementing plans to increase the supply of below market housing are not violating the Rent Control Act (PA 226 of 1988) by offering voluntary incentives. This League-supported legislation was introduced in February and received a committee hearing this last week of session. It’s anticipated the bill will receive another committee hearing in early 2018 and be voted out.

Two economic development proposals of key interest to municipalities were also voted out of the Senate during the last week of session.  Similar to legislation that died at the end of 2016, the Senate sponsor introduced Senate Bill 393, which consolidates all tax increment financing authorities, excluding Brownfield Redevelopment Authorities, into one act with added transparency and reporting requirements.  Senate Bill 469 would reinstate the Michigan Historic Preservation Tax Credit.  Both of these bills were voted out of committee and out of the Senate last week and have been referred to the House Tax Policy committee where they are expected to receive committee consideration in the new year.

The League was also pleased with the Governor’s signature on legislation allowing urban grocery store projects to access funding from the community revitalization program this week. The House and Senate coordinated efforts last week on House Bill 4207 to provide State Rep. Andy Schor with one last Public Act before he resigns to take over as mayor of the City of Lansing.

Three different proposals related to the new Personal Property Tax system also saw movement before the recess, with Senate Bills 570-573 being finalized and sent to the Governor.  These bills provide for a much needed local mechanism to address late-filed business exemption applications.  Senate Bills 590-593 were voted out of the Senate and were referred to the House Local Government committee.  These bills, promoted by the League and reported from the Senate committee earlier this fall, would essentially hold communities harmless from any reduction in their debt limit due to a reduction in their property tax base from now-exempt personal property.  Finally, House Bill 5086 was developed between local government groups and the Department of Treasury to address a host of technical and minor policy issues related to the continuing implementation of the new system and the need to align the statute with the practical realities of managing and administering the new law.  This bill moved nearly unanimously out of the House last week and will be considered by the Senate Finance committee in early 2018.

Finally, a League-supported proposal to allow for the voluntary coordination of election duties and functions moved this month as House Bill 4671 received overwhelming support in the House and is now awaiting further action before the Senate Elections & Government Reform committee.

Infrastructure and technology issues also experienced a flurry of lobbying and negotiation over these final weeks of 2017.

Our advocacy efforts combined with a broader coalition opposing legislation which would have preempted most local control over private telecommunication provider line relocation projects.  We were able to delay action on House Bill 5098 that was being pursued by the industry before the end of the year.  This proposal remains alive, however, and we will continue to work to block further action on this bill.

The discussions surrounding the proposed industry roll-out of small cell technology is quickly becoming a big issue for municipalities. Small cells are low-powered antenna nodes that have a range of up to 2 miles and are installed for the purpose of relieving congestion for wireless users. The term “small” refers to the footprint of the device. Small cell devices can be mounted on their own 40’ poles, or on existing utility or street light poles. Senate Bill 637 was recently introduced that would create a new act that allows for small cell technology to be consider a permitted use both inside and outside the right-of-way with limited exceptions. The bill would severely limit local control around siting, impair municipal ability to protect the public health, safety and welfare of residents, and hinder local government’s ability to manage the ROW, potentially leading to a significant increase in the number of new poles within our communities.  Supporters of this proposal are looking for a statewide regulatory structure that is similar to the Metro Act and the Video Franchise Act.

The League is opposed to the language as introduced but working with the Chairman, Senator Mike Nofs, of the Senate Energy and Technology Committee to improve the bill. To do that we have extensively researched legislative efforts in other states, discussed the issue with several communities and municipal attorneys, and looked at the Distributed Antenna System (DAS)/Small Cell License Agreement created by the Grand Valley Metro Council.

League staff have met with Chairman Nofs and presented alternative language based on our research and conversations with members. This viable alternative to the introduced legislation strikes a balance between local control and the nationwide deployment of this new technology. The telecommunications industry will continue its push for the bill when the legislature returns next year in the hopes of quick action . We have asked the Chairman that this issue not be rushed and that all parties be brought to the table to discuss this bill and our alternative.

The Michigan Municipal League is also participant on the Lead and Copper Rule Stakeholder Workgroup that is assisting MDEQ with recommendations to address modifications to the Administrative Rules promulgated pursuant to Michigan’s Safe Drinking Water Act, 1976 PA 399, as amended. The ongoing discussion continues to be about how to best protect the public from lead exposure.  Unfortunately, the preliminary draft rules add additional burdens to community water supply systems that run counter to the principles of asset management and may ultimately hinder the protection of public health. In addition to the League, there are more than a half dozen community water suppliers, the American Water Works Association, public health departments and others participating on this work group.

The draft rule would reduce the action level from 15 parts per billion down to 10 parts per billion, require communities to map their existing system to identify the presence of lead, require that a community water supplier be responsible for the replacement and cost of private lead service lines, along with many other requirements that could pose significant financial and logistic hardships on a community. The League has taken a stance that we are not opposed to determining how much lead is present in water systems or the need to systematically begin removing lead from systems, but it cannot be done in such a way that causes a financial hardship or conflicts with the Headlee Amendment or the Bolt decision.

Link to the Preliminary Draft Rule: 2017 Preliminary Draft Lead and Copper Rule

Link to the DEQ Summary Document: Summary Lead and Copper Rule Requirements

The Governor has requested this issue be placed on an aggressive timeline and a finalized draft rule is expected by the first of the year. Should our concerns not be addressed through the stakeholder process, communities will need to be prepared to offer public comments on the rule in early January. In the meantime we will continue to work with those stakeholders that have common concerns with the process and draft rules to make the necessary adjustment to help prevent exposure to lead while still allowing for the efficient management of our water supply systems.

The Legislature is scheduled to return to full session on January 10, 2018, with the Governor’s final State of the State message and the Fiscal Year 2018-19 budget presentation to follow shortly thereafter.

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

Congress Prepares for Final Vote on Tax Plan

The joint House-Senate conference committee announced their final reconciliation of the federal tax reform proposal on Friday.  Each chamber is expected to vote on the conference report early this week, where the bill is expected to receive enough support to make it to the President’s desk.

The League has been working with the National League of Cities and our delegation throughout the fall to advocate for changes to a number of provisions within the overall reform proposal that could impact communities in Michigan.  While a number of changes that we advocated for have been included in this final version, there are still areas of concern for Michigan municipalities.

After an initial review of the 503-page bill by NLC staff, the conference report on the Tax Cuts and Jobs Act (H.R. 1) does the following;

  • Publicly Issued Tax-Exempt Municipal Bonds: Preserved throughout the whole process.
  • Private Activity Bonds (PABs): Conference report sided with Senate version and preserved PABs.
  • Advance Refunding (ARs) Bonds: Conference report had no difference to reconcile. Tax exemption for interest earned on ARs would terminate on 12/31/2017.
  • New Markets Tax Credits (NMTC): Conference report sided with Senate version and preserved NMTC until their authorization normally expires.
  • Historic Tax Credits (HTC): Conference report sided with the Senate version and preserves the 20% credit for rehabilitation costs to certified historic structures, but eliminates the 10% credit for pre-1936 structures.
  • State and Local Tax (SALT) Deduction: Conference report provided a new modification to SALT. Taxpayers would be able to deduct up to $10k in property taxes combined with either income or sales taxes.  

House Actions: The House Rules Committee is expected to consider the bill on Monday (12/18) and possibly vote on it by Tuesday (12/19).

Senate Actions: The Senate aims to hold 10 hours of debate and a vote on Wednesday (12/20).

A continued thanks to all of you who have sent letters, called members of Congress and helped make sure city priorities have not been ignored.

Feel free to reference www.nlc.org/TaxReform for more information, or reach out with any questions or concerns. Stay tuned.

 

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

 

 

Federal Tax Reform Update – US Senate Proposal

Staff from the National League of Cities shared the following information with MML and other state leagues over the weekend, following the Senate’s release of their proposed version of tax reform…

Late Thursday, the Chairman of the Senate Committee on Finance Orrin Hatch (R-UT) released the Chairman’s Mark of his Tax Cuts and Jobs Act.  The Senate Committee on Finance is expected to markup this legislation on November 13, 2017 at 3:00 p.m. We urge you to contact your congressional delegation, especially the Senate Finance Committee (www.finance.senate.gov/about/membership).

After 4 days, the House Ways and Means Committee concluded committee markup on Thursday as well.  A floor vote on H.R. 1 is expected next week, most likely on Wednesday or Thursday.     

In the House, there are still nine Republicans who are opposed to the tax bill because of its treatment of SALT: New Jersey Reps. Leonard Lance, Frank A. LoBiondo and Christopher H. Smith; New York Reps. Peter T. King, Lee Zeldin, Elise Stefanik and Dan Donovan; and California Reps. Darrell Issa and Tom McClintock. Please thank those Members of the House who are standing strong with us in writing or via social media.

The House and Senate leadership have both stated that they expect to go to conference to reconcile differences in the bills, but they could bypass going to conference entirely.  Either way, they hope to send a final bill to the President for his signature in December. Below, find quick summary on bill differences.

 

  House Bill – Final As of Mark Up Senate Bill – No Markup
Tax Exempt Municipal Bonds Retained (not included in bill) Retained (not included in bill)
Private Activity Bonds Eliminated Retained
Non-refundable Bonds Eliminated Eliminated
State and local income and sales taxes Eliminated (except for those attributable to business income) Eliminated (except for those attributable to business income)
Property taxes Retained (up to $10,000) Eliminated
Mortgage interest Retained (but only on debt up to $500,000 for new loans; no interest on second home, no interest on new home equity loans) Retained (but no deduction on home equity loans)
Personal casualty losses Eliminated (except for federal declared disaster areas) Eliminated (except for federal declared disaster areas)
Nonqualified deferred compensation arrangements Eliminated Eliminated
Historic Tax Credits Eliminated Retained (but reduces their value)
New Mark Tax Credits Eliminated Retained (until current authorization expires in 2 years)
Work Opportunity Tax Credits Eliminated Eliminated
Low Income Housing Tax Credits Eliminated Retained

Today, the Chairs of House Municipal Finance Caucus released an oped to protect bonds and tax credits. www.washingtonexaminer.com/…

Also, NLC was in US News and World Report on tax reform www.usnews.com/news/the-report/articles/2017-11-10/…

We will continue to challenge any plan that threatens the tax exemptions for bonds used to finance critical infrastructure, eliminates the state and local tax deduction that protects local decision making and erases tax credits that strengthen communities.

 

 

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

MDOT Seeking Input From Local Agencies on Construction Services by October 20

The League is working with MDOT to get your feedback!  The department would like to engage in a more consistent and aligned approach to satisfying their duty of ensuring local agency program compliance with state and federal requirements.  In order to do so, They need to identify areas of construction oversight inconsistencies and gauge the effectiveness of current activities, guidance, and processes.  Your feedback will help them identify things that work well, and more importantly, areas they need to improve.  Please take a few minutes to complete the survey at https://www.research.net/r/X2766XJ

The survey will be open until October 20, 2017.  Anyone who works on Local Agency Program projects, in particular the construction side of things, is welcome to participate.  Responses are not limited to one per agency. Please also feel free to share this survey with your consultants as well.

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.

$500 million federal TIGER program accepting grant applications for road projects; due October 16

The federal government has announced it is now accepting applications for the FY 2017 Transportation Investment Generating Economic Recovery (TIGER) program, with $500 million in available funds for infrastructure projects including roads.

The application deadline for the 2017 TIGER solicitation is October 16.

The Department of Transportation will hold public two webinars:

  • September 13 and 19, 2 – 4 p.m., on “How to Compete for TIGER Grants;” and
  • September 18, 2 – 4 p.m., on “Preparing a Benefit Cost Analysis.”

To register for the free webinars, please visit the TIGER Webinar Series webpage.

Additional information about the TIGER program is available at the TIGER website. Questions may be directed to Ryan Brumfield, 202.366.2639, ryan.brumfield@dot.gov, in the TIGER program office or to FHWA TIGER program staff Sam Snead, 202.366.0857, sam.snead@dot.gov.

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.

MDOT kicking off 2018 Local Grade Crossing Surface Program; applications due October 27

MDOT provides funding assistance for highway-railroad grade crossing surface improvements on local roads. This annual program offers 60% funding for eligible projects, with railroads responsible for the remaining 40% of costs. Projects are selected in compliance with criteria established by state law.

After a successful launch in 2017, 2018 Local Grade Crossing Surface Program announcement letters are being mailed to all railroads and road agencies with active highway-railroad grade crossings within Michigan.

The 2018 Call for Projects opened in early September, with program letters containing additional details mailed to road authorities and railroads. Application materials for road agencies are now available, with a deadline for submittals of October 27, 2017. Project selections are expected to be confirmed by late November, with authorizations scheduled to be issued in time for the 2018 construction season. The 2017 Program had over 130 applications resulting in more than 70 approved projects to improve local crossing surfaces.

2018 Application
Sample Surface Program Railroad Authority Letter
Sample Surface Program Road Authority Letter

Questions about the program should be directed to Kristian Foondle, MDOT Local Grade Crossing Program Manager, at foondlek@michigan.gov. Click here for a list of railroad contacts

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.