MAC supports reintroduced bill to reform Tax Tribunal, resolve Dark Stores crisis

Deena Bosworth, director of governmental affairs

Deena Bosworth, director of governmental affairs

A bill that restores fairness to Michigan’s property tax appeals system was reintroduced in the House March 21 with the strong support of MAC and other local government leaders throughout the state.

House Bill 4397, sponsored by Rep. David Maturen, R-Brady Township, is already backed by a bipartisan group of 54 House members. Officials discussed the legislation and issue at a news conference Tuesday afternoon.

“Deed restrictions that prevent commercial property from being utilized by another commercial retailer not only prevent true competition, but also artificially drive down demand for the property, thereby lowering the value.” said Deena Bosworth, director of governmental affairs for MAC in a statement released Tuesday. “That’s the key problem here. Rep. Maturen drew on his experience as a county commissioner and as an appraiser to identify a solution to this and the other problems the Tax Tribunal has created with its Dark Stores rulings.”

HB 4397 would require Tax Tribunal members to apply standard appraisal procedures when reaching their findings of facts and conclusions of law in larger property tax cases. The bill is a reintroduction of legislation that was approved in the state House of Representatives in June 2016 by a 97-11 margin.

To read the complete statement, click here.

MAC details need for action on funding to House committee

deena TV 3-8-17MAC’s Deena Bosworth provided an overview of the funding crisis besetting counties across Michigan during an appearance Wednesday before the House Local Government Committee.

“The Great Recession really hurt our property tax values … you need to understand property tax values can drop as fast as the market drops, but we can’t recover when the value of your home is going up, it takes a long time for that taxable value to go back up,” Bosworth explained. “The demand on our services hasn’t gone down, but the revenue has, when you adjust for inflation.”

Funding reform is a top legislative priority for MAC in 2017.

You can see Bosworth’s complete testimony here.

Bosworth’s presentation also can be found in the members section of MAC’s website.

Comments sought on indigent defense standards

megaphone imageThe Michigan Indigent Defense Commission (MIDC) is seeking public comment on the minimum standards now under consideration. Those standards involve education and training, the initial client interview, experts and investigators and counsel during critical court appearances.

Deadline to comment is March 9.

Once the public comment period has ended, LARA will make a decision on approval. If the standards are approved, a 180-day clock for counties to submit their local operational plans will begin.

NOTE: Implementation of those plans does not have to begin until the plans are approved and any additional costs are paid for by the state.

The Michigan Supreme Court conditionally approved these standards, but had constitutional concerns regarding their oversight of the commission. Legislation passed last year addressed this concern by moving the commission from the judicial branch to the state Department of Licensing and Regulatory Affairs (LARA) to ensure MIDC is independent of the judiciary. Due to this move, MIDC was required to resubmit the proposed standards to the LARA for approval, which it did the week of Feb. 6.

Comments should be submitted by March 9, 2017, to comments@michiganidc.gov. All comments will be posted on the MIDC website.

House takes up OPEB reform package

retirementIn an effort to address the more than $11 billion in unfunded accrued OPEB (Other Post-Employment Benefits) liabilities for local governments across Michigan, the House is reviewing a package of bills aimed at changing the insurance benefits for government retirees. The 13-bill package, put forth by Speaker Kevin Cotter (R-Isabella), creates the Local Government Retirement Act and amends all the relevant statutes to require compliance with the main bill, House Bill 6074.

Of Michigan’s 83 counties, 26 do not offer OPEB, while another six are currently at least 80 percent funded in the benefits, which would make them exempt from some of the requirements in the act. The remaining 51 counties have an accumulated unfunded liability of approximately $3 billion.

Breakdown of counties by OPEB commitments
(Updated 1/3/17 with corrected figures for Livingston County)

The six counties above the 80 percent mark — Barry, Cass, Clinton, Macomb, Oakland, Ottawa — would be exempt from the changes to current employee and current retiree OPEB benefits, regardless of whether or not the employees are currently vested in the benefit. These counties, however, would still be subject to the provisions for Medicare eligible retirees, Medicare supplemental policy contributions and for all new hires as detailed below.

The main provisions of the package include:

  • Requires an “unvested” retiree to contribute a minimum of 20 percent toward the cost for post-employment insurance and caps a local government’s contribution to a maximum of 80 percent.
  • Limits local governments’ contributions toward OPEB benefits for all new hires to a maximum of 2 percent of the employee’s base pay.
  • Requires all retirees to be on Medicare when eligible.
  • Caps local government contributions to Medicare supplemental policies to 80 percent of the cost of the policy.
  • Prohibits a local government, regardless of whether or not it meets the 80 percent funded threshold, from providing insurance benefits to retirees who are eligible to participate in a medical benefit plan or retirement health benefit plan offered or provided by an employer other than the local government.
  • Directs that “vested” employees will be exempt from changes in the act. To determine whether or not an employee is vested/exempt, the package states that if a collective bargaining agreement entered into before act’s adoption clearly and expressly confers a fixed, unalterable right to a vested retirement health benefit for an unambiguous duration, then the act does not impair that vested retirement health benefit for that duration.

After consulting with the Executive Committee of MAC’s Board of Directors and several county administrators, MAC took the position of “support in concept” and testified before the House Local Government Committee on that theme on Dec. 1. MAC noted in its testimony our appreciation for providing local governments with some assistance in tackling this looming obligation by taking this issue off of the bargaining table and for the state diverting legal challenges to the proposed law from the local governments that seek to amend the benefits for unvested employees and retirees.

MAC also conveyed concerns with the approach, including:

  • Many Michigan counties already have acted to change these benefits for current employees and for new hires. This should be recognized by the state.
  • Local control has been, and continues to be, a vital component of good governance, but the state needs to “untie the hands of the county so they have the tools necessary to address the issues.”
  • This approach focuses only on fixing local government budgetary issues by going after the costs associated with the employees that provide the public services we all rely upon. MAC would like to see the Legislature actually address the revenue side of the equation.

In addition to the concerns outlined above, MAC will be working with the Legislature on language changes and certain provisions that need to be addressed for specific counties. We anticipate additional hearings next week. For more information, contact Deena Bosworth at Bosworth@micounties.org

Republicans build on big majority in county commissioner seats

mac-michigan-map-partisan-board-stats-11-10-2016Michigan Republicans expanded their already large margin in county commissioner seats in the Nov. 8 General Election, a MAC review of unofficial results shows.

The GOP now holds 432 seats, with one vacancy in Ontonagon County still to be filled. That’s up from 396 seats after the 2014 elections, for a net gain of at least 36 seats.

Democrats fell to 182 seats, while independents and third-party members hold 7 seats.

Republican majorities will sit on boards governing 63 of Michigan’s 83 counties; Democratic majorities will control 19 boards, while the Keweenaw board does not have a partisan majority.

Partisan control shifted in five counties due to election results:

  • Arenac (D to R)
  • Clare (R to D)
  • Isabella (D to R)
  • Keweenaw (D to no partisan majority)
  • Lake (D to R)

Of the 622 commissioners in 2017, 160 will be new to the office, not counting the vacancy in Ontonagon. The turnover rate of 26 percent is consistent with historical results.

Republican-majority counties: Alcona, Allegan, Alpena, Antrim, Arenac, Barry, Benzie, Berrien, Branch, Calhoun, Cass, Charlevoix, Cheboygan, Chippewa, Clinton, Crawford, Dickinson, Eaton, Emmet, Grand Traverse, Gratiot, Hillsdale, Houghton, Huron, Ionia, Iosco, Isabella, Jackson, Kalkaska, Kent, Lake, Lapeer, Leelanau, Lenawee, Livingston, Luce, Mackinac, Manistee, Mason, Mecosta, Menominee, Midland, Missaukee, Monroe, Montcalm, Montmorency, Newaygo, Oakland, Oceana, Osceola, Oscoda, Otsego, Ottawa, Presque Isle, Roscommon, St. Clair, St. Joseph, Sanilac, Schoolcraft, Shiawassee, Tuscola, Van Buren, Wexford

Democratic-majority counties:  Gogebic, Ontonagon, Iron, Baraga, Marquette, Alger, Delta, Muskegon, Kalamazoo, Ingham, Washtenaw, Wayne, Macomb, Genesee, Saginaw, Bay, Gladwin, Clare, Ogemaw

Click here to see a larger version of the partisan-control map.

MAC’s McGuire makes case for new revenue for roads on ‘The Big Show’

McGuireMAC Executive Director Tim McGuire used an appearance on “The Big Show” with Michael Patrick Shiels to make the case that only new revenue will propel the state out of its roads crisis.

“”Do we want dirt roads? … The point is, if you are going to fix the roads, you have to raise revenue. … We have to raise some revenues to pay for the roads. It’s just gotta be done,” McGuire said.

MAC’s Board of Directors, made up of county commissioners from across the state, has long supported a tax increase to generate the new dollars necessary to jump-start maintenance on our crumbling roads.

Treasury releases county-by-county liquor tax estimates

Liquor-StoreThe Michigan Department of Treasury reports that liquor tax distributions to counties will decline to $49.88 million in fiscal 2016, from $73.75 million in fiscal 2015.

The 4 percent liquor tax that gets distributed to counties across the state is set to expire at the end of 2015. Back in 2008, the Legislature refinanced the Cobo Hall facility in Detroit and extended the liquor tax. As part of that package of bills, counties would still receive the liquor tax, but would be limited to receiving only that amount that was collected in their county. Currently the liquor taxes collected in Oakland, Macomb and Wayne counties are distributed to the rest of the counties. In essence, the liquor taxes collected in those three counties have subsidized the amounts to the rest of the state. In FY 2015, those 80 counties are receiving approximately 200 percent of the liquor taxes actually paid in their jurisdictions.

For FY16, Treasury says, “The 80 ‘out-state’ counties will receive 101 percent of the FY 15 liquor tax collections in their county. Macomb, Oakland, and Wayne share 101 percent of the FY 15 liquor tax collections in the three counties, which is estimated to be a slight increase compared to their estimated FY 15 distribution. Macomb and Oakland counties get a portion of the liquor taxes collected in Detroit.”

To see the county-by-county figures, click here.

MAC still sees simple, direct election on 1-cent sales tax boost as best way to address roads crisis

transport funds 10-17-14The Michigan Association of Counties (MAC) reiterated today its longstanding support for a statewide vote to increase the sales tax by 1 penny, with all new funds generated dedicated to road work.

Jon Campbell, president of the MAC Board of Directors and an Allegan County commissioner, said in the wake of Tuesday’s defeat of Proposal 1:

“Voters in Michigan are telling public servants three things: They want more money for our crumbling roads. They want a direct, simple plan. They want to ensure new revenue is dedicated to roads.

“More than a year ago, the MAC Board of Directors decided the best plan for our state was a 1-penny increase in the sales tax dedicated to roads. We still see it as a simple, direct approach that raises the funds to address the crisis. And, based on the EPIC-MRA poll results released May 5, nearly two-thirds of voters would support it.

“Our membership, 622 county commissioners across the state, is eager to work with the Legislature and Gov. Rick Snyder to quickly and decisively handle this challenge.”

MAC committees to review hotel taxes, fracking fees

MAC committees on the environment and economic development are tackling some intriguing issues in their sessions on April 17.

The Economic Committee will be looking at the value of altering state law on hotel/motel taxes. The Citizens Research Council of Michigan has produced a handy one-page summary of what current law allows.

The Environmental Committee will hear from Krystle Sacavage of the Pennsylvania Public Utility Commission about that state’s regulations and “impact fees” on hydraulic fracturing, or “fracking.”

If you are a commissioner interested in serving on one of MAC’s committees (Environmental and Regulatory Affairs; Economic Development and Taxation; Judiciary and Public Safety; Health and Human Services; and Transportation) contact Casey Steffee at steffee@micounties.org for an application and more information.

House GOP plan offers opportunity to bolster county services

MAC logo blueytLANSING, Mich. – County officials across Michigan are ready to work with majority Republicans in the Michigan House on key elements of their 2015 “Action Plan,” which was released today in Lansing.

The Michigan Association of Counties, which represents the 622 county commissioners across the state, sees fertile ground to nurture reform on several issues that counties deal with on a daily basis:

  • Tax-capture reform: MAC is pleased that the House GOP noted that tax increment financing by municipalities “is leaving other levels of government collecting a fraction of what they otherwise would.” MAC has long worked at the State Capitol to bring fairness and collaboration to the tax-capture process.
  • Road commission merger authority: MAC agrees with House Republicans that, “The provisions in law that allow county boards of commissioners to consolidate their road commissions under the umbrella of general county government must be reinstated.” That authority expired at the end of 2014 and it should be a top priority for the Legislature to act on restoration in 2015.
  • Community mental health: “There is a continued need to further explore and evaluate policy and budgetary solutions to ensure that those with mental-health needs, and their loved ones, have access to quality and consistent care,” the plan states. Michigan counties know this all too well and will continue to educate policy-makers and the public on the nuances and demands of proper mental health services.
  • Sentencing reform: MAC understands and supports the need to reduce the prison budget’s huge bite on state resources, but changes in sentencing must be made in such a way that county jails and county taxpayers are not left holding the bill.
  • Veteran services: It’s vital to reverse the trends that have left Michigan near the bottom of national rankings on services to our veterans.
  • Public notices: Laws to ensure transparency written with 19th century techniques in mind should and can be updated to protect the public interest while reducing the financial burden on county coffers.

“We are generally pleased with the course being charted by the House leadership,” said Deena Bosworth, MAC’s director of governmental affairs. “And we stand ready to hammer out the details to make these goals into policy. But that requires a balancing act by lawmakers. For example, it’s great for them to urge a focus on the long-term liabilities of local governments, but they can’t, at the same time, be looking to enact more property tax exemptions that drain the very funds that local governments need to cover their liabilities.”

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For more information on MAC, go to www.micounties.org. Deena Bosworth is available to speak to the media on this topic. She can be reached at (800) 258-1152 or Bosworth@micounties.org.