This morning the House Tax Policy Committee reported Senate Bill 396, a bill that would amend the General Property Tax Act to provide that, after December 31, 2011, if a property is destroyed due to an accident or natural disaster, the taxable value of the replacement property would be the same as the year of the incident and not subject the Proposal A annual adjustment of the lesser of the rate of inflation of 5 percent.

This would apply to reconstruction properties if the rebuild is done with substantially the same materials as the original, the square footage is not more than 5 percent larger than the original property and it is completed no later than the December 31 in the year that is 3 years after the incident.

The League is opposed to this legislation that now heads to the full chamber for review.

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

The programs impacting local units of government in the federal budget were all preserved, or saw small increases in the budget Congress recently approved. The budget overall increases discretionary spending to state and local governments by 4.5%, $24 billion, to a total of $492 billion. Some key local programs that saw flat funding or slight increases include TIGER grants and public transit “new starts” program, CDBG, Clean Water and Drinking Water State Revolving Loan Fund programs, and the COPS program.The budget funds the federal government through September 30, 2014. The President is expected to present his FY 2014-15 budget to Congress some time in March.

Summer Minnick is Director of Policy Initiatives and Federal Affairs. She can be reached at 517-908-0301 or sminnick@mml.org

This morning Rep. Earl Poleski (R-Jackson), Chair of the House General Government Appropriations Subcommittee, addressed the League board to talk about the upcoming budget.  The general government budget is the budget that contains revenue sharing and the Economic Vitality Incentive Program (EVIP).

Board members were direct with Rep. Poleski in discussing their frustration with funding cuts to revenue sharing and challenges with the EVIP program.

Utica Mayor and League President Jacqueline Noonan was concerned over Poleski’s comments about how new EVIP standards will look at legacy costs. Noonan explained many communities, hers included, have been doing all they can to address legacy costs and to now possibly get a requirement to do so is bothersome.

“At the very basic level I have some resentment that the Legislature seems to think that those of us in local government don’t know what we’re doing and that we haven’t already done all of these things,” Noonan told Poleski. “In fact, we are trying very hard – well intentioned, intelligently planning – to fund those legacy costs.”

Linden Mayor and Former League President David Lossing found it interesting that Governor Snyder in his recent State of the State address asked the federal government to distance itself from state government budget issues and yet the state of Michigan wants to be closely involved in local budget issues. He encouraged Poleski to form a work group to study and potentially reform three key areas of municipal financing – the personal property tax, Proposal A and the Headlee Amendment.

“As I listened to the governor’s State of the State address last week I find it really ironic that as he was calling for an amendment to the U.S. Constitution to get the Congress to consider to get the federal government out of state budget issue areas the state still intervenes on our local budget issue areas through EVIP,” Lossing said.

Grand Rapids Commissioner Rosalynn Bliss, MML board member, said the importance of placemaking and creating vibrant communities as a way to spur economic development throughout the state is seemingly not understood among lawmakers.

“I’m frustrated to hear over and over from state officials, ‘that we know what the problem is and we’ll fix it.’ We got to come up with a solution quickly,” Bliss said.

We appreciate Rep. Poleski’s taking time to address the board and answer tough questions. He expressed a willingness to explore changes to the municipal finance system as well as ways to deal with pension and OPEB obligations.

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

Earlier this week the House Tax Policy Committee heard testimony on two pieces of legislation that would require assessors to get written permission to enter structures in order to assess them.

House Bill 5172 requires written consent for an assessor to enter a structure, and if that consent is denied the assessor cannot increase the value of the property based on any assumptions.

House Bill 5173 states that the assessor’s procedural manual may not require a homeowner to grant an assessor access to a property nor may an assessor access a property without written permission.

There was significant concern voiced by a number of committee members on this legislation. Obviously this legislation would significantly hamstring the ability of our assessors to do their jobs.

The committee did not vote on the legislation, and they are currently not scheduled to be taken up at next week’s meeting.

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

Last night the Governor gave his State of the State address. He did mention the need to invest in roads, but there was no mention of reinvesting in communities or fixing the state’s broken municipal finance system.

The following statement is from Utica Mayor and Michigan Municipal League President Jacqueline Noonan regarding the state budget surplus announced yesterday (Thursday, January 16, 2014):

“We strongly support the Governor’s ongoing call to fix Michigan’s crumbling roads and bridges, but we grow increasingly disappointed in the total lack of concern for fixing the state’s archaic and broken municipal finance system.  Unless and until the Legislature and Governor stop raiding funds that by law were supposed to go to local communities for police and fire, roads and bridges, and other essential services, Michigan’s per capita income levels will continue to lag other states and the nation, and more of our cities will plummet into fiscal crisis. Not only is this not sustainable for the status quo, but it keeps Michigan from being competitive in attracting and retaining talent and jobs in a global market. While fiscal crises confront cities all across Michigan, the silence and lack of solutions to fix the state’s broken municipal finance system from the Governor and Legislature is deafening.”

“To move Michigan forward, the League, along with numerous partners, has developed a policy vision and plan for Michigan’s cities called the Partnership for Place: An Agenda for a Competitive 21st Century Michigan. You can view this policy agenda here:www.mml.org/advocacy/partnership-for-place.html.”

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

Next Wednesday the House Tax Policy Committee is considering two pieces of legislation that would require assessors to get written permission to enter structures in order to assess them.

House Bill 5172 requires written consent for an assessor to enter a structure, and if that consent is denied the assessor cannot increase the value of the property based on any assumptions.

House Bill 5173 states that the assessor’s procedural manual may not require a homeowner to grant an assessor access to a property nor may an assessor access a property without written permission.

Obviously this legislation would significantly hamstring the ability of our assessors to do their jobs. The legislation will receive a hearing on Wednesday, January 22 at 9 a.m. Please contact your legislators and ask them to vote no on this legislation.

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

Earlier this week the House Oversight Committee heard testimony on House Bills 5193 and 5194, bills that amend the Open Meetings Act.

House Bill 5193 prohibits a local unit from going into closed session in connection with anticipated litigation. House Bill 5194 indicates that if a public body reenacts a disputed decision in cases where an action has been initiated to invalidate a decision of a public body then that reenactment is not a defense to a criminal action.

The League testified in opposition to this legislation. In particular the changes to HB 5193 are confusing and unnecessary. We further indicated a desire to amend the statute to allow reasonable (as opposed to actual) attorney fees and to allow the discussion of the sale of property (in addition to purchase and lease of property) in closed session.

The committee did not vote on the legislation.

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

Over the next few days we’re going to hear a lot about Michigan, the comeback state.  About how, after over a decade of economic decline, our state is on the rebound, retaining and attracting small and large companies, and creating jobs.  We’ll hear about how we have a $500 million rainy day fund and a projected surplus of nearly $1 billion. And we’ll hear a lot about how this was achieved by an administration that has received accolades across the country for their financial wizardry at getting it done.  Yes, there will be lots of hand shaking, back slapping and a general declaration of victory.

Of course there are always two sides to any story and the other side of this one provides a stark contrast in reality. For instance, ask economists of any particular stripe and they’ll tell you that Michigan’s economic recovery has largely been accomplished on the foundation of the auto bailout.  And the dirty little secret is that it’s also been accomplished by the shift and shaft budget prowess of those who make such decisions, moving money away from various areas like funding local government services, education, and other services to fill budget gaps and fulfill other priorities. And that all comes at a price.

The reality at the local level is the one I’d like to focus on for a moment. I’ve heard it said time and again that all local government officials and administrators need to do is share services more, get a handle on pension costs, and forecast and plan better.  That’s tough to do when the partnership between state and local governments to provide local services has been broken. Over the past 12 years, payments to local governments have been slashed by a cumulative amount of $6 billion. That’s right $6 billion. Couple that with the loss in property tax revenue that communities are still recovering from due to the financial crash of a few years ago, along with the fact that our state limits the ability of locals to raise their own money, and the picture becomes more complicated.

The reality is that our municipal finance system, or that system which funds local services, has been broken for some time.  And while there will be those declaring victory, the fact is that there are more local units on the state Department of Treasury fiscal distress watch list than at any other time in this state’s history. People can blame local officials for that all they want, but it’s only because of the work by local officials that there aren’t more communities in bankruptcy.

So before we go about declaring victory, let’s remember there is still a lot of work to do to ensure Michigan’s economic recovery is long-term and sustainable and not just made into a platform for term-limited politicians seeking to declare their legacy as having fixed the place.

Have you ever wanted to engage more in federal policy? Now is your chance! The National League of Cities is accepting applications for their full Policy and Advocacy Committees. There are several committees to choose form, including Community and Economic Development; Energy, Environment and Natural Resources; Finance, Administration and Intergovernmental Relations; Human Development; Information Technology and Communications; Public Safety and Crime Prevention; Transportation Infrastructure and Services. You do not need to be a  member city of NLC to participate in the full committees (you do need to be a member to serve on each Steering Committee). The full committees meet at NLC’s two major events each year – the Congressional Cities Conference and the Congress of Cities and Exposition. If you are interested, the deadline to submit your application is Friday, January 24th. To apply, click here.

Summer Minnick is Director of Policy Initiatives and Federal Affairs. She can be reached at 517-908-0301 or sminnick@mml.org.

Recently, several articles have appeared that reference a “glitch” in the Affordable Care Act (ACA), in which communities with more than 50 employees will be forced to provide coverage for volunteer firefighters. Since this came about, Treasury and the IRS have reviewed the information and just released a statement, saying they will be providing rules soon that addresses this unintended consequence. The release from Treasury can be found by clicking here.

Summer Minnick is Director of Policy Initiatives and Federal Affairs. She can be reached at 517-908-0301 or sminnick@mml.org.