Legislative Report

October 2005

Michigan, we have a budget! That might have been the pronouncement of the Governor and the legislature as they reached basic agreement on the 2005-06 budget literally days before the new fiscal year began on October 1. It was not easy, however. In the end, each side got some of what it wanted. The structural deficit remains to be resolved in yet another year. One-time measures used to balance the budget in the last several years are quickly disappearing so something will have to give eventually. It is questionable whether the current budget is solidly balanced or whether significant adjustments will have to be made during the course of the fiscal year. New revenue sources will have to be found or further cuts will have to be made. The decision makers (governor and legislators) have vastly differing opinions on these two options. So, as I always say, stay tuned!

There was quite a bit of legislative activity during the month of September. The following is a report of some of that activity which might be of interest to senior/retirees:

HBs 4469, 4082, 4470 & SB 301 are three bills which have been signed into law by Governor Granholm. They are Public Acts 140, 141, 142, and 143, respectively. These acts deal with various aspects of organ donation. A certain portion of the amount paid for driver licenses will go into a fund to support the administration of the program by the Secretary of State’s Office as well as an awareness program for organ donation. Driver license applicants must be asked if they wish to become an organ donor. The acts mandate that certain records be maintained by the Secretary of State regarding those who are donors and that a heart insignia on a driver license indicates that the person is a donor and specify that an anatomical gift made via a will or document of gift would be irrevocable regardless of the desires of the deceased’s next of kin. The provisions of the acts become effective January 1, 2007.

HB 4811 is a bill which reverses the current ban on lawsuits against drug manufacturers if the drug has been approved by the Food and Drug Administration and the labeling of the drug was in compliance with the FDA’s approval at the time it left the manufacturer’s premises. The ban on such lawsuits was approved in 1995 and is controversial and considered very unfair to citizens who may suffer injury from a prescription drug. The Democrats have long sought to have the ban overturned which this bill would do. They forced the bill to be discharged from the Committee where it has been since May, 2005 and it is now on the House floor.

HB 4204 is a bill which would permit the Governor to exempt the sale of gasoline and diesel fuel from the sales tax by executive order. The idea is to lessen the financial blow to the consumer at times when gasoline prices are extraordinarily high. The Governor could exempt the sales tax by executive order. Such authority puts the governor in a “no-win” situation inasmuch as citizens would pressure her to suspend the tax while she knows the state can ill-afford to lose the revenue from such exemption. Later, when she restored the tax, the citizenry would be unhappy. Both the School Aid Fund and Constitutional revenue sharing depend on gasoline and diesel fuel tax as a revenue source. For that reason, many feel it is unlikely that the Governor would sign such a bill if it were to pass. The bill has passed the House and has gone to the Senate Committee on Government Operations.

HB 4577 is a unique bill which would allow a private citizen to bring a civil action on behalf of the state to recover losses due to Medicaid Fraud. The Attorney General would eventually decide whether to assume primary responsibility for the action brought by the original plaintiff. The bill further grants the plaintiff “whistleblower” protection in order to permit successful plaintiffs a share in the proceeds resulting from the lawsuit. The percentage of the proceeds a plaintiff may receive depends on a number of factors including the degree of involvement. Provisions of the bill allow for damage awards to defendants who may be victim of frivolous lawsuits. The bill was reported out of the Committee on Judiciary and has passed the House and now goes to the Senate for consideration.

HB 4834 is commonly referred to as the payday lending bill. This bill is intended to regulate firms which make short-term loans to individuals in anticipation of their getting the individual’s paycheck in order to repay the loan. The bill would require such firms to be licensed by the Office of Financial and Insurance Services, limit a firm to having only one open transaction at a time with a borrower or prohibit a firm from lending money if the borrower had a open transaction at more than one other firm, place a maximum $600/31 day limit on a loan transaction, require that a formal agreement be entered into with the borrower, allow a service fee of between 11% and 15% to be charged depending on the amount of the transaction, requires firms to enter all transactions into a statewide database to be used as a reference source in determining eligibility for a loan. The bill further provides administrative procedures which must be followed by payday lending firms. All of the above conditions would have to be in place by December 31, 2006. The Senate passed a bill with many similar provisions, but yet some different ones. One major difference is the starting date of the bills. The Senate bills call for an April 1, 2006 start date. The two versions of the bills are now in Conference Committee where the differences will be resolved.


Public Service Commission telephone deregulation order — Attorney General Mike Cox has announced that he will appeal the PSC order deregulating telephone service in several areas of the state. Mr. Cox is fearful that the rates will become higher as a result of the order. He does not feel that currently marketplace competition is such that citizens will benefit from the deregulation.

Mailing of absentee ballots — Representative Ed Gaffney will soon propose legislation allowing absentee ballots to legally be mailed to senior citizens without their having to request such service. This announcement comes after a Wayne County judge banned the clerk for the City of Detroit from mailing ballots to senior citizens unless they request them, a practice that has long been done statewide as a courtesy to seniors. Representative Gaffney hopes his proposed legislation will become law very soon.

OFIS: Complaints against insurance companies down — The Office of Financial and Insurance Services has announced that complaints against insurance companies are down from previous years. OFIS determines the complaint ratio by dividing the dollar volume of premiums written by the number of complaints filed. This information can be obtained online at www.michigan.gov — Consumer Services Section.

Michigan Chamber’s sponsored term limit proposal — The Michigan Chamber of Commerce’s Board of Directors has given its approval for the Chamber to spearhead a Constitutional amendment regarding revisions in term limits. The Chamber is considering which one of two proposals to seek to get on the ballot. One proposal calls for a lifetime 14 year limit on the number of years a person can serve in the Michigan legislature. This time could be served between the two chambers. The other calls for a 12 year limit with all twelve years being served in one chamber. Additionally, the ballot proposal would include (1) a waiting period before a legislator could engage in lobbying activity after leaving the legislature, (2) financial disclosure of assets as a requirement for candidacy, (3) loss of pay for legislators when absent from sessions without a valid excuse, and (4) a 10 day waiting period and at least one public hearing before voting on legislation increasing or decreasing taxes. This promises to be a very contentious issue once it is formalized with groups lining up on both sides of the issue.

DNR camping fee increases — The Department of Natural Resources has announced that approximately half of its campsites will increase fees by $4 per night. Reservation fees will increase from $2 to $8, cancellation fees from $5 to $10, and a $5 fee for those without reservations. These increases will partially be used to establish an Emergency Repairs Fund for park upkeep.

Open Meetings Act violations — The Open Meetings Act has come into conflict with security measures employed in state buildings since 9-11. It appears that the OMA prohibits the asking of an individual for identification or to sign a log in order to gain entry to a public meeting. Since many meetings falling within the scope of the OMA are held in state buildings requiring identification and sign-in in order to gain entry, security comes in conflict with personal freedom. As an interim solution, agencies and organizations housed in buildings with security measures in place are moving their meetings to other locations. Case in point: The State Administrative Board now meets in the Michigan Library and Historical Museum, a building which does not require sign-in.

Comments sought on voting rights revisions — The Secretary of State has announced that revisions in voting procedures to comply with the federal Help Americans Vote Act have been made. These revisions cover such issues as replacing outdated voting equipment, ensuring access to voting sites for voters with disabilities, and initiating voter educations programs. The Secretary of State is seeking voter comments on the revisions. They can be viewed at the county clerk’s office or on the website: www.michigan.gov/sos. Comments to the changes may be e-mailed to elections@michigan.gov or mailed to the Michigan Department of State, Attention: HAVA Plan, P.O. 20123, Lansing, Michigan 48901-0726.

People in the News

Alexander Lipsey, a Democrat state representative from Kalamazoo, has announced his candidacy for Attorney General. A bankruptcy attorney, he will be term limited after completing his current Legislative term.

Nancy Cassis, a Republican state senator from Novi, has withdrawn as a candidate for Governor. This leaves Dick De Vos, a Grand Rapids area businessman, as the only Republican candidate.

Rick Weiner, Governor Granholm’s Chief of Staff has announced he is leaving that position as of the end of October. Weiner indicated that he was not up to another political campaign next year.

John Burchett, currently the head of the Governor’s Washington office, will succeed Weiner as Chief of Staff.

John Garfield, a Republican state representative from Rochester Hills, was arrested for drunk driving after hitting a car in Troy. Mr. Garfield apologized to his constituents and fellow legislators and entered a drug treatment center.

Clarence Phillips, a Democrat state representative from Pontiac, finished first in the mayoral primary in that City. Should he be elected mayor in November, a special election will have to be held to fill the last year of his term-limited legislative tenure.

Editor’s note: Alvin Whitfield is former President of the Lansing SERA Chapter and former Chairperson of the Michigan SERA Council and current Legislative Representative for both the Council and the Lansing Chapter. He may be contacted at 1241 Runaway Bay Drive, C-3, Lansing, Michigan 48917; phone 517/703-9666; e-mail: alwhit@worldnet.att.net.

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