This morning the House Energy & Technology Committee heard a second week of testimony on House Bill 5184, a bill that would deregulate electricity. More specifically it would move the state from a system of hybrid electric regulation to deregulation.

The legislation would require large electric utility companies (at least 1 million customers) to submit plans to the Michigan Public Service Commission (MPSC) to either sell off or to transfer their electric generation assets to an affiliate—thus separating electric generation from distribution. The affiliate would not be regulated by the MPSC.

This morning the House General Government Appropriations Subcommittee reported its recommendations for the general government budget that includes the Economic Vitality Incentive Program (EVIP).

Under this proposal category 1, the dashboard, would remain in effect without change. Category 2 would require 5 percent of the second EVIP payment to be committed to road construction or preservation. Category 3 would require 5 percent of the payment to be committed to unfunded liabilities. The language further says that a community that receives less than $50,000 in EVIP funding would not have to comply with the EVIP requirements.

In addition the House proposes changing how EVIP funds are distributed. A local unit would receive a 1 percent increase if they were eligible for payment in the current fiscal year or $7.14609 per capita, whichever is greater. The per capita formula would add include hundreds of additional communities to the formula without regard to service provision.

Reps. Fred Durhal (D-Detroit) and Sam Singh (D-East Lansing) both offered amendments to strip out the EVIP requirements altogether and restore full funding for statutory revenue sharing. We appreciate their efforts to eliminate these burdensome requirements.

The League has significant concerns about this language and its disregard for both local control in spending and distribution to communities who provide services. We will continue to work on language that helps invest in communities who provide essential services and does not penalize them by requiring that they spend money as the legislature dictates.

Samantha Harkins is the Director of State Affairs for the Michigan Municipal League.  She can be reached at 517-908-0306 or email at sharkins@mml.org

This week the House Tax Policy Committee voted out a ten bill package that represents months of negotiations on personal property tax (PPT) reform. The Michigan Municipal League’s message on PPT has consistently been 100 percent, guaranteed replacement. The bills do represent 100 percent replacement and a more stable reimbursement mechanism.

The bills, Senate Bills 821-830, now head to the House floor. We expect the House will vote on the legislation next week. We anticipate these bills will continue moving quickly through the legislative process, likely making it to the Governor’s desk before spring break in April.

Samantha Harkins is the Director of State Affairs for the Michigan Municipal League.  She can be reached at 517-908-0306 or email at sharkins@mml.org

This week the House passed Senate Bill 636, a bill that would give phone companies the ability to transition from traditional land lines to internet-based service beginning January 1, 2017.

The bill would amend the Michigan Telecommunications Act to do make a number of changes including eliminating a requirement for a Michigan Public Service Commission (MPSC) proceeding for a telecommunication provider to discontinue basic local exchange or toll service to an exchange, beginning January 1, 2017. It would also require a provider wishing to discontinue service to notify the MPSC, the provider’s customers, any interconnecting providers, and the public at the same time as filing a petition for discontinuance with the Federal Communications Commission (FCC).

The bill would further require a provider to notify the same parties again upon the FCC’s approval, at least 90 days before discontinuing service. It would also allow the MPSC to issue an order allowing the current provider to provide the service until another willing provider was available, if the MPSC determined that another provider was not capable of providing the service.

The legislation now heads to the Governor for his signature.

Samantha Harkins is the Director of State Affairs for the Michigan Municipal League.  She can be reached at 517-908-0306 or email at sharkins@mml.org

In 2011 the legislature passed a number of reforms to help employers control costs and be better stewards of taxpayer resources. One of the, if not the, most significant reform was to prohibit retroactive pay increases after a contract has expired. This game changing statute, PA 54 of 2011, has helped communities settle contracts more quickly and provides more certainty in municipal budgets. We are hearing the House Commerce Committee will be taking up House Bill 5097, a bill that would exempt police and fire from PA 54 so they can have retroactive pay increases after a contract expires. This would be detrimental to our ability to settle contracts quickly and efficiently.  The bill was taken up for testimony this morning in the House Commerce committee.

The committee reaction was relatively expected. There was a lot of talk about legislative history and the intent of this legislation being school employees not municipal employees.

The League testified along with a labor attorney who works with a number of communities. We indicates that PA 312 numbers are down and this statute is working well. We don’t see a need to change it.

I urge you to contact your legislators to let them know how detrimental this carve out would be. The arguments the public safety groups use for supporting this bill are that the number of PA 312 filings would proliferate and the legislature only intended this bill to impact teachers.

According to the Michigan Employment Relations Commission there were only 43 PA 312 filings in 2013 as opposed to 69 in 2011. PA 312 filings are significantly lower than they were before enactment of PA 54.

In addition, even if the legislature only intended this for teachers, it has been a game changer for municipal budgets, and it’s critical that we keep this tool to allow local units the opportunity to settle contracts expeditiously and save taxpayers money.

We appreciate all the members who have already contacted their lawmakers on this issue and we hope others follow their lead. It is critical that you please contact your legislators and ask them to OPPOSE House Bill 5097. You can find the contact information for your Legislators here.

We’re also starting to see some traction on this issue in the media, including an article in Gongwer News Service with the headline “MML Beginning Opposition Campaign on Retroactive Pay Raises Bill”. The article, which can be viewed here if you subscribe to Gongwer, includes references to this blog post.

Samantha Harkins is the Director of State Affairs for the Michigan Municipal League.  She can be reached at 517-908-0306 or email at sharkins@mml.org

Yesterday afternoon the Senate General Government Appropriations Subcommittee heard testimony on the Economic Vitality Incentive Program (EVIP). The League testified about the need for additional funding and the problems with the program in general.

The chair, Sen. John Pappageorge (R-Troy), indicated that he would not be including EVIP in the Senate’s General Government budget recommendations. He did, however, express an interest in getting additional money to struggling communities.

We expect to see the budget recommendation language in the next couple of weeks.

Samantha Harkins is the Director of State Affairs for the Michigan Municipal League.  She can be reached at 517-908-0306 or email at sharkins@mml.org

This morning (March 4, 2014) the Michigan State Senate passed a 10-bill package that represents months of negotiations on personal property tax (PPT) reform. The Michigan Municipal League’s message on PPT has consistently been 100 percent, guaranteed replacement. The bills do represent 100 percent replacement and a more stable reimbursement mechanism.

The bills, Senate Bills 821-830, now head to the House for consideration.  The House Tax Policy Committee has scheduled two hearings on the bills next week. We anticipate the bills moving quickly through the legislative process, likely before spring break in April.

League staff and League members (Dearborn Mayor Jack O’Reilly, Holland Mayor Kurt Dykstra, Flint Mayor Dayne Walling and Delta Township Manager Richard Watkins) joined Lt. Gov. Brian Calley yesterday in a news conference about the new PPT package. Go here to read about the news conference. View more photos from today’s PPT press conference. View a League press release about the announcement.

Samantha Harkins is the Director of State Affairs for the Michigan Municipal League.  She can be reached at 517-908-0306 or email at sharkins@mml.org

In 2011 the legislature passed a number of reforms to help employers control costs and be better stewards of taxpayer resources. One of the, if not the, most significant reform was to prohibit retroactive pay increases after a contract has expired. This game changing statute, PA 54 of 2011, has helped communities settle contracts more quickly and provides more certainty in municipal budgets. We are hearing the House Commerce Committee will be taking up House Bill 5097, a bill that would exempt police and fire from PA 54 so they can have retroactive pay increases after a contract expires. This would be detrimental to our ability to settle contracts quickly and efficiently.  The bill will be taken up in committee on Wednesday, March 5.

I urge you to contact your legislators to let them know how detrimental this carve out would be. The arguments the public safety groups use for supporting this bill are that the number of PA 312 filings would proliferate and the legislature only intended this bill to impact teachers.

According to the Michigan Employment Relations Commission there were only 43 PA 312 filings in 2013 as opposed to 69 in 2011. PA 312 filings are significantly lower than they were before enactment of PA 54.

In addition, even if the legislature only intended this for teachers, it has been a game changer for municipal budgets, and it’s critical that we keep this tool to allow local units the opportunity to settle contracts expeditiously and save taxpayers money.

We appreciate all the members who have already contacted their lawmakers on this issue and we hope others follow their lead. It is critical that you please contact your legislators and ask them to OPPOSE House Bill 5097. You can find the contact information for your Legislators here.

We’re also starting to see some traction on this issue in the media, including an article in Gongwer News Service with the headline “MML Beginning Opposition Campaign on Retroactive Py Raises Bill”. The article, which can be viewed here if you subscribe to Gongwer, includes references to this blog post.

Samantha Harkins is the Director of State Affairs for the Michigan Municipal League.  She can be reached at 517-908-0306 or email at sharkins@mml.org

 

For years the League has been working on a tax reduction loophole that was created due to the 2002 Michigan Supreme Court case of WPW Acquisition Company v. City of Troy. After Proposal A created the term taxable value, the Legislature passed legislation that allowed for an increase and decrease of certain commercial property’s taxable value based on their occupancy. This was meant to allow the taxable value of income producing property to reflect the ebb and flow of the economy.

Under that system, the City of Troy granted a reduction to WPW Acquisition Company due to a reduced occupancy. However, when the City increased their taxable value when they were more fully occupied, WPW Acquisition Company sued the City, claiming they could not increase their taxable value above 5% or the rate of inflation, whichever is less, due to Proposal A. The Supreme Court addressed the question of increases in occupancy and agreed with WPW. However, the reduction issue due to occupancy was never in question, so a legal loophole, creating tax inequity, was born.

This morning the House Tax Policy Committee passed Senate Bill 114, a bill introduced by Senator Vince Gregory (D-Southfield) that amends the General Property Tax Act. The Act’s definition of “losses” includes an adjustment in value, if any, due to a decrease in the property’s occupancy rate, to the extent provided by law. The definition of “additions” includes an increase in value attributable to the property’s occupancy rate if a loss had been previously allowed because of a decrease in occupancy rate, or if the value of new construction was reduced because of a below- market occupancy rate.

The bill would limit the use of occupancy rates in the determination of losses to the period before December 31, 2013. The use of occupancy rates in the determination of additions would be limited to the period before December 31, 2001.

This afternoon the Senate Finance Committee unanimously passed a ten bill package that represents months of negotiations on personal property tax (PPT) reform. The Michigan Municipal League’s message on PPT has consistently been 100 percent, guaranteed replacement. The bills do represent 100 percent replacement and a more stable reimbursement mechanism.

The bills, Senate Bills 821-830, will be taken up by the full Senate next week. We anticipate the bills moving quickly through the legislative process, likely before spring break in April.

League staff and League members (Dearborn Mayor Jack O’Reilly, Holland Mayor Kurt Dykstra, Flint Mayor Dayne Walling and Delta Township Manager Richard Watkins) joined Lt. Gov. Brian Calley yesterday in a news conference about the new PPT package. Go here to read about the news conference. View more photos from today’s PPT press conference. View a League press release about the announcement.

Samantha Harkins is the Director of State Affairs for the Michigan Municipal League.  She can be reached at 517-908-0306 or email at sharkins@mml.org