Capitol News
July 15, 2018
Although the legislative schedule called for the legislative summer recess to begin June 21, the legislature decided to go home June 12 after it took final action on the two budget bills that day. Many legislators are running for re-election, for the other chamber, for Congress, or local office and campaigning for the August 7 primary was looming large on their minds. The Michigan House has cancelled its scheduled July 25 session because of the ongoing construction inside the Capitol. It is next scheduled to meet on August 15. The Michigan Senate is still scheduled to meet July 25 and August 15 though that may change.
VOTE AUGUST 7
The 2018 Michigan primary is Tuesday, August 7. Requests to have an absent voter ballot mailed to you must be received by your city or township clerk no later than 2 p.m. the Saturday before the election. If you have an absentee ballot, you have until 8 p.m. on election day to complete the ballot and return it to your clerk’s office. Many clerks offer absentee voting booths on the Saturday before election day for the convenience of voters to apply for and/or cast their absentee ballots early. On election day, polls are open across Michigan from 7 a.m. to 8 p.m. See www.michigan.gov/sos for information about voting in Michigan and to see your sample ballot.
Primary voters will need to decide whether to vote for Republican, Democratic, or Libertarian party candidates since in Michigan you cannot cross party lines on the partisan part of the ballot.
For Governor, Republicans running are Jim Hines, Bill Schuette and Brian Calley. Democrats running are Abdul El-Sayed, Shri Thanedar and Gretchen Whitmer. For the first time in Michigan history, the Libertarian Party had enough votes in the 2016 general election to become eligible to run in the primary. Libertarian candidates Bill Gelineau and John J. Tatar are on the ballot.
For the U.S. Senate, incumbent Democrat Debbie Stabenow is running for her party’s nomination. John James and Sandy Pensler are vying for Republican primary votes.
Other races unique to each district or precinct include U.S. Representative, State Senator, State Representative, County Commissioner, and Delegate to the County Convention for each party. County Conventions for the parties are held in mid-August where delegates vote on party business. In late August a state party convention is held where the parties officially nominate candidates for Attorney General, Secretary of State, Michigan Supreme Court, the Court of Appeals and the statewide education boards as well as conduct other business. Three write-in votes for precinct delegate can get you elected since most precinct delegate slots are not contested across the state.
FY 2019 BUDGET SIGNED
Continuing his tradition of on-time budgets, Governor Snyder signed the $39.9 billion appropriations bill for departments, SB 848 now Public Act 207 of 2018, on June 21 with no line-item vetoes. However he said that preventing federal money for Planned Parenthood and other abortion providers through a boilerplate provision in the appropriations bill is unenforceable by the state.
The budget includes $300 million more road funding from general revenues, increases for the Rainy Day Fund to more than $1 billion, a State Police trooper recruit school to train 75 more troopers, money for the governor’s workforce development plan, $58 million in the 2018 and 2019 fiscal years for school safety and training more than 350 new corrections officers.
The final $16.8 billion education budget, HB 5579 now Public Act 265 of 2018, funds K-12 schools, community colleges and universities. There will be a minimum $120 per pupil increase for K-12 schools, the largest in 15 years, a two percent increase for universities and one percent increase for community colleges.
BILL UPDATES
Interest Rate and Actuarial Change Bill — On July 2, the Governor signed HB 5653, now Public Act 336 of 2018, which would amend the State Employees’ Retirement Act to align two assumptions used in the calculation of survivor benefit payments with current (and future) experience. A survivor benefit option (which provides reduced pension payments to both the retiree while living and to a designated survivor after the death of the retiree) is designed to be actuarially cost-neutral to the pension fund compared to the cost of a non-reduced pension provided to a retiree who does not choose a survivor benefit option. The Office of Retirement Services requested the bill’s introduction and passage.
Under the former law, when calculating the options for survivor benefit payments, the actuary is required to assume an 8% interest rate and also use the 1983 group annuity and mortality table. The new act will replace those assumptions with an interest rate determined by the Director of the Department of Technology, Management, and Budget along with the State Retirement Board in consultation with the actuary, and using the mortality tables adopted by the Department and the State Retirement Board.
The Senate Fiscal Agency says the potential effect of these changes on the calculation of survivor benefit payments is indeterminate. A lower interest rate likely would lead to a higher reduction from the retiree’s pension and therefore a lower calculated survivor pension payment; however, longer mortality assumptions generally would lessen the reduction to the survivor benefit payments (i.e., result in a higher survivor benefit payment than a shorter mortality assumption would produce).
Annuity Bill — House Bill 5231 to amend the State Employee Retirement Act to require the state to seek contractors to provide annuity options for state employees and retirees has passed the House, the Senate Finance Committee, and awaits full Senate consideration.
Corrections classification correction — Eight active employees and one retiree will be included in the State Employee Retirees’ Act defined benefit pension benefits under HB 5411, which passed the House unanimously on May 1 and was referred to the Senate Appropriations Committee for further action. The omission was discovered in a 2015 audit.
Senior Auto Insurance Proposal — Senate Bill 787 that would allow those 65 and older to choose between unlimited personal injury protection (with some limitations described below) or a $50,000 capped auto no-fault insurance benefit. If the latter is chosen, the senior would have to pay for any medical costs in excess of $50,000 through their own personal health insurance (Medicare, employer insurance coverage, Medicare supplement insurance, Medicaid or personal finances) for medical bills stemming from auto crashes. The bill passed the Senate in June and awaits further consideration in the House Insurance Committee. Since my last report there has been a good deal of media coverage and public discussion of the proposal.
The bill is tie-barred to Senate Bill 1014, which would make various changes to the Insurance Code regarding automobile insurance and the Michigan Catastrophic Claims Association. Under Senate Bill 787 (S-4), payments to providers for products, services, and accommodations would be subject to limits proposed by Senate Bill 1014. SB 1014 would create an insurance fraud prevention authority, put limits on attendant care provided by a relative or person living in the same household and cap medical coverage for those injured where no insurance coverage exists at $400,000. There is no limit currently on what is known as assigned claims, those exceeding $550,000 in costs.
Pension Tax Repeal — Candidate for Governor Gretchen Whitmer has mentioned repeal of the retirement tax in a television ad. Abdul El-Sayed mentions opposition to the pension tax on his campaign Web site. However, before either of them could sign such a repeal bill, the measure would need to pass both the Michigan House and Senate. Changing the make-up of the Michigan House and Senate is required before pension tax repeal could be on any Governor’s desk. Each year the revenue from the pension tax grows, now amounting to several hundred million dollars. Revenue replacement (or program cuts) will be a big issue in any discussion of pension tax repeal. Ask the candidates for the state legislature and Governor about pension tax repeal.
Newly Introduced — HB 6192 to allow a resident or the resident’s representative to authorize electronic monitoring devices in a resident’s nursing home room has been introduced and referred to House Health Policy Committee. HB 6250 to provide a freeze of the taxable value for the primary residence of those with gross incomes lower than $40,000 and either 63 and above who have lived at the residence for at least the immediately preceding 10 years or, regardless of age, owned the property for 30 years. The bill has been referred to House Tax Policy Committee.
BALLOT PROPOSALS
Marijuana Legalization — The voter-initiated law from the Michigan Coalition to Regulate Marijuana Like Alcohol to legalize marijuana possession and consumption for adults 21 years and older will likely be Proposal 2018-1 on the November 6 ballot. The legislative deadline to approve or reject the measure, or suggest an alternative, expired without action in early June. If approved by voters, Michigan would become the 10th state to legalize, regulate and tax marijuana for recreational use.
If adopted by voters, retail marijuana sales will be subject to a 10 percent excise tax and Michigan’s regular six percent sales tax. In addition to covering the costs of regulation, marijuana excise tax revenues will include:
- 35 percent to the State School Aid Fund for K-12 public education
- 35 percent to the Michigan Transportation Fund for the repair and maintenance of roads and bridges
- 15 percent to municipalities where a marijuana business is located
- 15 percent to counties where a marijuana business is located
In addition, the taxes will provide $20 million per year for two years to fund FDA-approved research analyzing the benefits of medical marijuana for treating post-traumatic stress disorder and other medical conditions of military veterans.
Local communities would have the authority to regulate marijuana businesses within their jurisdictions or ban them altogether. See www.regulatemi.org for more information about the proposal.
Redistricting — The Voters Not Politicians ballot proposal, endorsed by Michigan SERA, hopes to amend the state constitution to take the political district boundary drawing from legislative and gubernatorial control and place it in the hands of an independent citizen redistricting commission. In mid-June, former California Republican Governor Arnold Schwarzenegger endorsed the proposal, saying California’s legislature’s rating went from 14 percent to 44 percent after an independent citizen redistricting commission was instituted in his state.
A legal challenge by Citizens Protecting Michigan’s Constitution, closely allied and apparently financed by the Michigan Chamber of Commerce, claims the proposal does not mention every place the Constitution is affected and a constitutional convention is required to make so many changes. On June 7 a unanimous Court of Appeals panel rejected claims of the challengers, later refused to grant a stay to block certification of the proposal to the ballot and ordered the Board of State Canvassers to put the proposal on the ballot. On June 20 the Board of State Canvassers approved the measure for the November ballot (likely as Proposal 2018-2) to the cheering of about 200 Voters Not Politician supporters.
The Michigan Supreme Court has granted oral argument in the challenge and scheduled it for July 18. In applying to submit an amicus brief opposing the Voters Not Politicians redistricting proposal and in support of the Chamber of Commerce challenge, Attorney General Bill Schuette argued the proposal, if passed by the voters, would create a fourth branch of government.
Michigan Radio recently pointed out that the Michigan Chamber of Commerce hosted fundraisers for two of the Michigan Supreme Court Justices up for election this fall, Kurtis Wilder and Elizabeth Clement. Whether they will voluntarily recuse themselves or be asked to recuse themselves from involvement in the case is an open question.
The non-partisan Citizens Research Council issued a report on June 25 saying tests now being used to evaluate whether congressional and legislative districts have been gerrymandered do show that Michigan fails several of those tests. These tests suggest some gerrymandering to favor Republicans over the last two ten-year cycles in Michigan. See the report at www.crcmich.org.
Minimum wage — The proposed voter-initiated law from Michigan One Fair Wage would increase the minimum wage to $12 per hour from its current $9.25 by 2022 and bring tipped employees, who now have a minimum wage of $3.52 per hour, up to the same minimum wage as everyone else by 2024 is being challenged in court by Michigan Opportunity, an organization led by the Michigan Restaurant Association. Although Michigan One Fair Wage had gotten approval of the form of its petition from the Board of State Canvassers before it began collecting signatures, Michigan Opportunity asserts technical legal problems with the form of the petition. The challengers also allege insufficient valid signatures. A minimum of 252,523 valid signatures from registered voters is needed before a voter- initiated law can be certified and sent to the Legislature for consideration.
Earned Paid Sick Leave — The proposed voter-initiated law from MI Time to Care would require employers in Michigan to provide one hour of sick time for every 30 hours worked up to a maximum of 72 hours of paid sick time in a year. The organization Small Business for a Better Michigan, which includes the Michigan Manufacturers Association, is challenging the validity of voter signatures on petitions submitted by MI Time to Care. It says it sees signs of fraud, duplicate signatures, signatures from non-registered voters, and other defects. Mi Time to Care claims nearly 2 million Michiganders are without access to earned paid sick time.
Promote The Vote — Proposed constitutional amendments to add a no-reason absentee voting option, straight-party ticket voting option, same-day voter registration, and generally modernize our voting laws similar to many other progressive states submitted 430,000 signatures to the Board of State Canvassers on July 9. To get on the ballot the proposal has to have at least 315,654 signatures from registered voters. Current Secretary of State Ruth Johnson has supported no-reason absentee voting if the voter provided identification at a clerk’s office. Previous two Secretaries of State, Candice Miller and Terri Land, also supported no-reason absentee voting. The House has passed legislation allowing for no-reason absentee voting, but it has stalled in the Senate. Straight-ticket voting option is still in a court challenge. Michigan SERA Coordinating Council has endorsed the proposal. See www.promotethevotemi.org.
The Board of State Canvassers will likely meet soon to hear staff reports concerning the validity of voter signatures in these last three measures.
MSU CRISIS UPDATE
With Governor Snyder out of town on June 12, two of the 27 bills related to the Michigan State University crisis created by Dr. Larry Nassar’s sexual assault of hundreds of girls under the guise of medical treatment were signed into law by Lt. Governor Brian Calley with some of the sexual assault survivors in attendance. Recently an ad for Calley’s gubernatorial campaign featured the women complimenting Calley for his support.
SB 871 now Public Act 182 of 2018 would extend the statute of limitations for charges of second or third degree criminal sexual conduct to be brought to 15 years after the offense is committed or by the victim’s 28th birthday, whichever is later. SB 872 now Public Act 183 of 2018 provides a 90-day retroactive window for abuse victims to bring lawsuits which will likely limit the bill’s effect to the victims abused by Nassar.
Meanwhile, the MSU Board of Trustees approved the proposed $500 million settlement with the survivors, approved the appointment of former Supreme Court Justice Robert Young, Jr. as its Chief Legal Counsel, but rejected a motion to remove interim MSU President, former Governor John Engler, over his insensitive remarks to and about survivors. William Strampel, Nassar’s boss and the former dean of the College of Osteopathic Medicine at MSU, retired in the face of tenure revocation proceedings on July 6. On July 12 Standard and Poor’s reduced MSU’s bond rating, saying “the anticipated debt issuance will considerably compress the university’s available resource ratios” and there is uncertainty about whether the university’s insurers will agree to help pay the settlement. S & P also stated “The negative outlook also reflects our view of senior leadership’s current risk management and balancing of stakeholders’ interests as current engagement of the senior leadership team has demonstrated limited capacity to quell current campus unrest.”
SERA Recent News — If you are a SERA member, you are eligible to receive SERA Recent News, a periodic e-mail about breaking news and links to media stories of interest to state employees and retirees. Write to michigansera@comcast.net, giving your name, email address, and chapter name.
Editor’s note: Mary Pollock is the 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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