Capitol News

May 2012

The Michigan Legislature took a couple weeks off in April for home-district work, but some could be found in warmer climates. Still there was plenty of political activity in Lansing.

Both and the House and Senate have finished their initial work on appropriations bills for FY 2013. Now the conference committees will start negotiations to come up with agreements to reconcile differences between the measures coming from each body and what the Governor wants. It is important to get appropriations bill done so that school districts that start their fiscal year on July 1 can know what their state funding will be.

House Democrats have brought a lawsuit against the Republican House leadership for the latter’s refusal to recognize Democratic member requests for recorded votes. Article IV, Section 18 of the Michigan Constitution says “The record of the vote and name of the members of either house voting on any question shall be entered in the journal at the request of one-fifth of the members present.”

In the Senate there is an orderly process that takes about 15 seconds for 20 percent of the Senators to indicate from their desks that they want a recorded vote.In the House, for instance, there is no recorded vote on the proposed amendment to remove the pension tax from the Income Tax reform bill last year because the House leadership only allowed a voice vote and with a swift gavel, declared the amendment defeated.

Michigan SERA Coordinating Council Endorses Protect Our Jobs Ballot Proposal

At its May 4 meeting in Lansing, the Michigan SERA Coordinating Council composed of delegates from all 21 chapters endorsed the campaign to put a constitutional amendment on the ballot guaranteeing collective bargaining rights. The Council heard from a representative of the Protect Our Jobs campaign and Larry Schneider, attorney for the Michigan State Police Troopers Association, before voting to endorse it.

The ballot proposal is a response to over 80 bills introduced in the Michigan Legislature reducing, unionization or employee rights in Michigan since January 2011. Twenty-five of those bills have passed and been signed into law.

Of interest to state employees and state retirees is that the proposal contains a provision to assure constitutionally-protected collective bargaining rights for state employee unions similar to that which the state police troopers achieved through a constitutional amendment in 1978. The proposed amendment includes the right to bargain retirement and pensions for future state retirees but will not allow bargaining over current state retiree pensions and benefits. However, should the health care benefits of current state retirees be threatened with change, the state employee unions would likely speak up to protect them.

Nearly 323,000 valid signatures will be needed by July 9, 2012, to get the amendment on the November ballot. Some Council delegates took Protect Our Jobs petitions to circulate for signatures of registered voters. If you would like to get involved in signature gathering, call 313-744-JOBS (313-744-5627) or write to Protect Our Jobs, 5859 W. Saginaw Hwy. #142, Lansing, MI 48917. SERA Chapter Presidents will have information about the regional contact people for the campaign also.

Update on Other Ballot Issues

The Stand Up For Democracy ballot proposal to repeal the Emergency Manager law was found to have sufficient signatures, but the Board of State Canvassers did not approve it for the ballot because the group Citizens for Fiscal Responsibility alleged the type size in the petition headline was too small. The Board deadlocked 2 2 along party lines. The proponents of the ballot issue have filed for a writ of mandamus in the Michigan Court of Appeals to compel the Board and Secretary of State to put the law repeal on the ballot.

The Ambassador Bridge owners have announced a petition drive to put a measure on the ballot to require a vote of the people on any new bridge.

RetakeOurGov, a Tea Party group and Political Action Committee, has announced its support of an amendment to Michigan's Constitution requiring approval of a two-thirds majority in the House and Senate to increase taxes. In a release, the group said that at least 13 other states require a super-majority in order to raise some or all state taxes.

Michigan SERA Testifies on Public Pension Fund Transparency Bill

On Thursday, May 3, I testified on behalf of Michigan SERA before the Senate Appropriations Committee, Subcommittee on Retirement concerning SB 797, a bill which would assure more transparency and standards for investing public pension funds, including investments for the state employees’ retirement system. Our testimony was that

  • We applauded the recent efforts of the Michigan Department of Treasury’s Bureau of Investments to provide more information on its Web site about pension fund investments;
  • We appreciated that the Investment Advisory Committee now has a Code of Ethics and Standards of Conduct that all 3 Committee members have signed;
  • We complimented the bill sponsors for the provision in the bill that prevents using the pension system’s assets as collateral to guarantee repayment of obligations made by a third party to a borrower such as Raleigh Studios which recently was reported to be near default on its bond obligations;
  • We think that the three pages of exceptions to the general rule in the bill that financial services organizations under contract to pension funds cannot give political contributions to officeholders ought to be eliminated. No political contributions ought to be allowed;
  • We think the ban on contributions should be expanded to a ban on gifts to officeholders such as travel costs and sporting event tickets and basically adopt the Civil Service Commission policy of “nothing of value;”
  • Though we are loyal Michiganders, we think it is imprudent investing to give preference or discriminate on the basis of geographical boundaries such as allowing up to 5 percent of pension fund to be invested in Michigan-based businesses as stated in the bill. We don’t want our pension funds to be used as an economic development program or as a political reward;
  • We want to see more transparency and similar regulation of the 401K/457 programs so there is public oversight of these programs.

Our testimony received a great response from Sub-Committee members. Chair Mark Jansen was very interested in more oversight of 401k/457 pensions and promised that legislation will be introduced soon about it. Senator Colbeck commented positively about the fear that Michigan-based business preference presented greater potential risk to the pension funds. Senator Caswell agreed with us that there should be no exceptions to the general rule of a ban on political contributions from financial services companies to officeholders. The Sub-committee approved the bill as presented. It will now go to the entire Appropriations Committee for review. That process may present opportunities for amendments that we have suggested. SERA’s testimony is available on our Web site mi-sera.org. (See the SERA Testimony page for this and other testimonies submitted on SERA’s behalf.)

School Employee Retirement Reform Update

After the first hearing where hundreds of school employees were in attendance with picketing and chanting, the second hearing on SB 1040 in April was calmer and more technical. ORS testified factually about the school employee retirement system and then promptly left so they weren’t there for follow-up questions. SERA is especially concerned that the current bill says all school employee retirees must pay 20% of the cost of their health care benefits. Testimony suggested a phase-in or reduction to 10% for some older retirees.

The bill as introduced would require school employees to reach age 60 rather than 55 before becoming eligible for retiree health care or their pensions. It also retroactively applied a graded premium approach to school employees hired after July 1, 2008. The proposed scheme is similar to that which is in effect for those state employees hired after March 31, 1997 and before April 1, 2012. Under reports from ORS of higher than usual retirement applications effective this summer that could increase school employee retirement system costs substantially and leave schools in a staffing crisis, the Governor and Republican leadership in the House and Senate have agreed to eliminate or modifiy some aspects of the reform legislation.

Seniors May Be Affected by Picture Identification Requirement

HB 5061 would require that picture identification be provided in order for a voter to pick up an absentee ballot in person. If the voter doesn’t have a photo ID, the voter could obtain a ballot through an affidavit process, but that ballot will be automatically treated as a challenged ballot.

It is estimated that about 10 percent of seniors do not have a driver’s license or a state-issued identification card. Many seniors have no birth certificate to use as a basis for a state-issued ID card because they were born at home, for instance. Contrary to popular conception, photo ID is costly and difficult to obtain. Michigan residents must produce no fewer than five documents to prove their identity, legal presence in the U.S., Social Security status, and residency in Michigan. No one document can be used for two things such as a passport to prove U.S. citizenship and identity. The bill has passed the House and is in the Senate Committee on Local Government and Elections.

News of the Day

If you are a SERA member, you are eligible to receive News of the Day, a periodic e-mail about breaking news and media stories of interest to state employees and retirees. Write to michigansera@comcast.net giving your name and chapter.

Editor’s note: Mary Pollock is the newly appointed Lansing SERA Chapter and SERA Council’s Legislative Representative. She may be contacted at 1200 Prescott Drive, East Lansing, MI 48823-2446; Phone 517-351-7292; E-mail michigansera@comcast.net.

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