Capitol News

June 2013

May and early June have been full of finishing the FY2014 budget and beginning movement on larger non-budget policy items. The legislature plans to break for their summer recess after June 20 until September 10, with one meeting day scheduled in July and August.

FY 2014 Budget

Two omnibus budget bills, one for education and the $34.39 billion ($7.88 billion General Fund) budget for all the other state programs, were approved mostly along party lines in late May and early June. Senate Majority Leader Randy Richardville praised the three-year record of an on-time budget process, recalling the Granholm years when there were two temporary shutdowns and legislators brought sleeping bags to the chambers in late September. Richardville also noted the increased investment in education and $46 million more in revenue sharing to local governments. The Dems criticized the budget for lacking the Medicaid expansion that Mr. Snyder proposed in his February budget recommendation, and what they see as a raid on the School Aid Fund to finance higher education and community colleges.

There was more budget drama than usual due to increased revenue projections revealed at the May 15 Joint Revenue Estimating Conference. Eventually approved were an additional $350 million in funding for Michigan’s transportation infrastructure and the improvement of Michigan roads; an additional $140 million in direct support for K-12 schools; an additional $75 million into the state's Rainy Day Fund; an additional $65 million in FY 2014 and $65 million targeted for FY 2015 for early childhood education programs; expansion of the dental care program to 78 of Michigan’s 83 counties for 70,500 low-income children in Ingham, Ottawa and Washtenaw counties.

Policy Items

Vulnerable Adults — On May 21, Gov. Rick Snyder signed legislation that further protects Michigan's vulnerable adults by allowing judges to impose consecutive sentences for criminals who embezzle from seniors or the mentally ill. In 2012, Snyder signed a 10-bill package to protect Michigan's senior citizens and vulnerable adults. The measures encourage the reporting of elder abuse and the strengthening of penalties for those who are convicted. HB 4264 is now Public Act 34 of 2013.

At a senior event on the Capitol lawn, Governor Snyder told reporters that he may have either have a special message on the elderly or a summit on issues facing seniors in early 2014. He commented that his mother was victimized by a caregiver who stole from her but then there was little he could do. And he drew some of his biggest applause by saying the state needs to work more at helping older individuals stay engaged in their communities.

Sales tax on the difference — Talked about for decades and back again is abolishing the sales tax on the difference between the trade-in value of a car and the car purchased.

Michigan Merit Curriculum changes — The House has passed HB 4465 and 4566 that would make changes to the high school foreign language, arts, physical education, math and science requirements for students interested in career and technical education. All Dems and two Republicans voted against the measure saying it was dumbing down the curriculum.

Medicaid expansion — Expanding Medicaid to over 300,000 Michigan residents by raising the cutoff to 133 percent of the poverty level financed by federal dollars is still up in the air. The Governor has reportedly called the big guns to help — U.S. Secretary of Health and Human Services Katherine Sebelius. The House passed a proposal with a 48-month limit on Medicaid benefits and up to a 5 percent premium depending on the recipient’s participation in prevention programs. House Dems opposed the time limit and the premium.

At this writing the chair of the House Competitveness Committee, Rep. Mike Shirkey (R-Clarklake) has announced new language that will include a proposal developed by the business community, Blue Cross Blue Shield of Michigan, the state's health plans and the Michigan Health and Hospital Association on how to reduce state payments to hospitals that serve a high percentage of poor people through Medicaid reform. Currently, residents who are uninsured go to the emergency room to receive care, and that is the most expensive health care. It has been pointed out that a person receiving Medicaid benefits might be in the middle of a critical medical situation when the time limit was reached and various medical conditions last more than four years.

Rehiring retired Corrections Officers — The Michigan House has approved 58 — 51 HB 4664 sponsored by Rep. Greg MacMaster, R-Kewadin to amend the State Employees Retirement Act to remove the September 30, 2013 sunset date for DOC to rehire retired up to 250 corrections officers in custodial positions without a negative impact on their pensions.  The administration believes this will save them $10 million in overtime as they recruit and train replacements for retiring officers. Michigan Corrections Organization opposes the bill saying few are interested and there may be safety issues. It still needs approval in the Senate. About 50 officers retire every month.

DIA Art Collection — A bill to protect the Detroit Institute of Arts’ holdings from the clutches of the Detroit emergency manager and a bankruptcy court was reported from the Senate Government Operations Committee. It would require an art institute to adhere to the code of ethics for museums published by the American Alliance of Museums or a successor organization, and specifically say that it could not sell items from the museum unless doing so would mean the institute is the direct beneficiary. John Pirich, an attorney for the DIA, said he believes the law would be upheld because of a public act of 1885 that placed art and the facilities they are located in into a sort of public trust.

Financing road improvements — The House Transportation and Infrastructure Committee has been discussing increasing vehicle registration fees by an average of 20 percent during hearings on HB 4630, 4632 and 4633. The first bill would increase an operator's license from $18 to $25, and would also increase the late fee for renewing a driver's license from $7 to $10.

HB 4632 would increase vehicle registration fees: For motor vehicles, motor homes or commercial vehicles that weigh 8,000 pounds or less of the 1983 or previous model year, and motorcycles of 2014 or a previous model year, the registration fee would be $50 (for vehicles up to 4,000 pounds), and $75 for vehicles between 4,001 and 8,000 pounds. The bill would increase registration fees for motor vehicles from the year 1984 and after and hold motorcycles from the year 2015 and after to the same standard of basing registration fees on the value of the vehicle. Vehicles valued up to $6,000 would hold a $35 fee, vehicles valued between $12,000 and $13,000 would hold an $80 registration fee and vehicles valued between $29,000 and $30,000 would hold a $160 registration fee. For vehicles valued at more than $30,000, the tax of $160 is increased by $5 for each $1,000 increment. For the first three years the driver pays registration fees, 95 percent of the tax assessed the previous year would be charged, and then the fourth year and after the tax would remain the same. For an electric or hybrid vehicle, there would be another $75 fee on top of the regular registration fee.

HB 4633 concerns a new digital printing process for license plates and would provide a 10-year expiration date for the plates.

Rep. Marilyn Lane (D-Fraser), minority vice chair of the committee, said many people are angry about the registration increases. But she said the increases have to happen to keep the funding of roads fair and equitable.

Mental health treatment court — Mental health treatment courts may become a reality in Michigan if HB 4694 — 4697 pass. A joint meeting of the House Judiciary and the Health Policy committees heard testimony from the Department of Corrections and a mental health court in Kalamazoo about mentally ill offenders’ treatment designed to keep them out of the criminal justice system. Officials from the Department of Corrections said mentally ill inmates are the most expensive inmates within the state's corrections system. A typical inmate costs $26,836 annually, while those who are the most severely mentally ill cost $162,000 annually. The officials said those symptoms of mentally ill prisoners make it difficult them for live in a correctional environment where it is loud, and there is a lack of privacy and isolation. They testified that 18 to 20 percent of prisoners are treated for mental health issues. Rep. Kevin Cotter (R-Mount Pleasant), chair of the House Judiciary Committee, said there isn't a timetable to get the bills reported from committee.

Hamtramck — Hamtramck is the latest governmental unit with a financial emergency warranting an emergency manager, joining Detroit, Flint, Allen Park, Pontiac and Benton Harbor. Ecorse recently was released from the program. Hamtramck has been under emergency management before, operating with an emergency financial manager from 2000 to 2007.

Political season approaches — Former U.S. Congressman Democrat Mark Schauer has entered the 2014 gubernatorial race and is already running a few points ahead of Snyder in polling. U.S. Representative Gary Peters (D-West Bloomfield) has declared he is running for the U.S. Senate seat being vacated by Carl Levin; Former Secretary of State Terri Land is the first Republican into the field for the U.S. Senate race. Early polling indicates Peters leads Land by a few points.

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

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

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