Without federal dollars, FY21 state budget will be grim for counties

Without numbers scheduled to be derived from the next consensus revenue estimating conference slated for late August, we can only estimate the anticipated state budget deficit for fiscal year 21, which beings Oct. 1, 2020. However, all indications lean toward a General Fund shortfall of more than $3 billion.

Should the federal government not provide additional, direct and flexible funding to states and local governments, the Michigan Legislature will be forced to make drastic cuts to roads, local governments, universities, community colleges, corrections and human services, all primary recipients of unrestricted General Fund dollars each year. The State Budget Office is anticipating a $3.1 billion deficit, while sources in the Legislature are expecting something closer to $3.5 billion for FY21. 

Counties were spared drastic cuts in the FY20 budget due to the allocation of federal CARES dollars to help mitigate the impact of the eliminated August revenue sharing payment. But without additional federal dollars, it’s safe to say we can anticipate losing a large percentage of the more than $200 million in statutory revenue sharing for FY21, in addition to cuts to other areas of the state budget.  

Again, all hinges on the August Consensus Revenue Estimating Conference and the actions at the federal level regarding continued COVIS-19 mitigation funding.

For more information on this issue, contact Deena Bosworth at bosworth@micounties.org.

Legislative County Caucus expected to grow in 2021

The ranks of MAC’s County Caucus in the Legislature should grow in 2021 following the results of the Aug. 4 legislative primaries this week.

Five current county commissioners won their party’s primary in House districts that solidly favor one party or the other, setting them up to be elected to the House of Representatives in November:

• Bob Bezotte of Livingston County won the Republican nomination in House District 47.
• Ken Borton of Otsego County won the Republican nomination in HD 105.
• Felicia Brabec of Washtenaw County won the Democratic nod in HD 55.
• Julie Rogers of Kalamazoo County won the Democratic nomination in HD 60.
• Amos O’Neal of Saginaw County claimed the Democratic nomination in HD 95.

All will be favorites to win in November and take office in January 2021.

Christine Morse of Kalamazoo County was unopposed for the Democratic nomination in HD 61, which will be highly competitive in the General Election.

In the current Legislature, 26 members are former county commissioners and thereby members of the County Caucus. Three of them, though, have reached their term limits. Still, based on current trends, the caucus should grow to more than 30 members in 2021.

 

County millages gain approval in record-breaking primary election

All but two county millage proposals gained voter approval in unofficial results in Tuesday’s primary election, which set a record for voter participation.

More than 2.5 million Michigan residents cast ballots on Tuesday, shattering the previous primary record of 2.2 million set in August 2018. The effects of the constitutional changes to voting that voters adopted in 2018 could be seen in this week’s results, as more than 2/3 of the ballots cast came through the option of “no reason” absentee (mail) balloting.

Of the 105 county-based millage requests on Tuesday monitored by the MIRS News Service, only 2 were rejected – one in Allegan County for its medical care facility and one in Iosco County for general operations. The majority of the requests were to renew or restore a millage, though several millage increases did gain voter support.

“Tuesday’s results represent an ongoing trend of Michigan county governments pushing extra-voted millages to fund services,” said Eric Scorsone, director of the Center for Local Government Finance and Policy. “Senior services, animal control, EMS and many others were funded.”

Michigan has 7,748,541 registered voters, of which the state deems 6,764,903 as active.

 

Last chance to register for the 2020 Virtual Annual Conference

Legendary Michigan State University coach Tom Izzo will address attendees of the 2020 Virtual Annual Conference LIVE on Aug. 20 at 11 a.m.. After his remarks on leadership and team building, the national championship coach will take questions.

 

Today, Aug. 7, is the final chance to register for the event.

 

The live chat will be one of the highlights of the 2020 MAC Virtual Annual Conference, which will include events on days between Aug. 18 and Aug. 27.

 

Other highlights include:

• Plenary sessions that will feature MAC’s Legislative Update, the semi-annual “State of MAC” report and an address by MAC Board President Veronica Klinefelt
• The Annual Business Meeting, during which members will vote on MAC’s policy platforms for the 2020-21 year
• Seven policy workshops that will focus heavily on the implications of COVID-19 for counties in the coming months
• A Virtual Exhibitor Show that will allow attendees to select up to five firms from which to hear 10-minute presentations

The unique nature of this event also brings changes to registration procedures:

• The conference registration fee is only $50 for members, which includes all county officials
• Attendees must register by a new deadline prior to the event – Aug. 7
• MAC will not accept “walk-up” registrations during the conference (this is due to credentialing and election procedures adopted for the conference)

Start your registration with our Attendee Packet.

 

Treasury sets next COVID webinar for Aug. 12; register now

In partnership with the Michigan Municipal League, Michigan Townships Association and Michigan Association of Counties, the Michigan Department of Treasury is pleased to announce the joint webinar, “COVID-19 Updates and Resources for Local Governments,” at 2 p.m. on Aug. 12.

Topics will include updates on CARES Act funding for local governments including: first responder hazard pay premiums, public safety and public health payroll expenditures, August revenue sharing payments, and water utility assistance. Additional topics include opportunities for local government to support businesses and an update on FEMA grant dollars.

Participants can register and submit questions on the webinar’s registration page.

For more information on this issue, contact Deena Bosworth at bosworth@micounties.org.

 

Governor vetoes bill on housing senior COVID patients

A bill to create regional facilities for COVID-19 patients that are separate from other nursing homes was vetoed this week by Gov. Gretchen Whitmer.

Senate Bill 956 would have created regional facilities for the housing of COVID-19 patients and required the Department of Health and Human Services (DHHS), in consultation with the Department of Licensing and Regulatory Affairs (LARA), to assess and report on the state’s response to COVID-19 in nursing homes and plan for any future response. It would also have prohibited admission or retention of coronavirus-positive individuals in nursing homes.

“Protecting the health and safety of nursing home residents and their staff continues to be a top priority for my administration,” said Whitmer. “Senate Bill 956 is nothing more than a political game that would relocate vulnerable seniors without any requirement for consent, doctor’s approval, or notification to patients and their families. It’s time for the Republican Legislature to get serious about protecting our most vulnerable and addressing the public health and economic crisis faced by our state. We look forward to continuing our work with stakeholders and legislators on the task force to develop real solutions that make sense for Michigan seniors and their families.”

“First, @GovWhitmer ignored experts who urged her not to expose nursing homes to COVID-19, with tragic consequences,” Senate Republicans wrote on Twitter in response to the governor’s actions. “Now, she has vetoed a bipartisan bill banning such a practice in the future. A slap in the face of Michigan families who have lost loved ones.”

Renee Beniak, executive director of the Michigan County Medical Care Facilities Council, serves on the Michigan Nursing Homes COVID-19 Preparedness Task Force created under Executive Order 135. The task force is tasked to adequately inform the state’s response to a potential second wave of COVID-19 and, by Aug. 31, 2020, produce a recommendation to the governor for an action plan on how to prepare nursing homes for any future wave of COVID-19 cases. Beniak said this week that the task force would be addressing the placement issue.

For more information on this issue, contact Meghann Keit at keit@micounties.org.

 

Compliance event to replace cancelled environmental conference

The Michigan Environmental Compliance Conference will not be held this year due to COVID-19 social distancing requirements. However, the Michigan Department of Environment, Great Lakes and Energy has created a Michigan Environmental Compliance Week, a week-long virtual event dedicated to helping local governments comply with environmental regulations that apply to them. This training will include webinars, livestream chats with directors, office hours with regulatory staff, case studies, best practices and more. It is free, and continuing education opportunities will be available.

 

Municipal Stability Board seeks comment on Best Practices and Strategies document

Section 8 of Public Act 202 of 2017 requires the Municipal Stability Board to review and annually update a list of best practices and strategies that will assist underfunded local governments in developing their corrective action plans on pensions and retirement benefits. At its July 15 meeting, the board approved an updated best practices and strategies document, which can be viewed at the Board’s website along with other documents at Michigan.gov/MSB.

The best practices and strategies document includes the following three best practice principles: Plan Funding, Modern Plan Design, and Effective Plan Administration. It also includes detailed corrective action plan approval criteria, including underfunded status, legality, and affordability.

The Board approved this document for public comment for a period of 30 days. Following the public comment period, the board will reconsider the document at their next scheduled meeting. Please send your comments to Treas-MunicipalStabilityBoard@michigan.gov by Aug. 19, 2020, with the subject line “Best Practices Comment: 2020”.

 

Staff picks

• Health professionals are the most trusted sources of information on COVID-19 (Center for Health and Research Transformation)
  
  
• Animated map: The history of U.S. counties (visualcapitalist.com)
  
  
• How debt collectors are transforming the business of state courts (Pew Trusts)
  
  
• Michigan Regulated Dams Map (Michigan Department of Environment, Great Lakes and Energy)

Whitmer tightens social, entertainment restrictions as caseloads climb

Gov. Gretchen Whitmer tightened restrictions on social and entertainment activity in Northern Michigan today in response to rising caseloads of COVID-19 in Michigan.

Beginning July 31, Executive Orders 160 and 161 direct that:

Bars that rely on alcohol sales for 70 percent or more of revenue are closed to indoor service.

Indoor gatherings are limited to no more than 10 people (in Regions 6 & 8, the limits are 25% of max capacity or 250 people, whichever is smaller).

These changes apply statewide, including to Regions 6 and 8 (the Upper Peninsula and 17 counties in the Northern Lower Peninsula), which have been operating with fewer restrictions for several weeks. The changes bring those regions into alignment with rules imposed on other regions in the southern parts of Michigan.

The executive orders consolidate and update a variety of existing executive orders, and it does expand activities in one area: the three casinos in the city of Detroit can reopen, but only to 15 percent of capacity.

Below is a summary of current executive orders on key county functions

Open Meeting Act

• Virtual sessions allowed (EO 154)
• Indoor gatherings limited to 10 people (EO 160, except for Regions 6 & 8)
• In Regions 6 & 8, 25% of max capacity or 250 people, whichever is smaller

Freedom of Information Act

• Normal operations resumed in June (EO 112)

Courts

• Normal filing deadlines resumed in June

Nonessential workers

• Any work capable of being performed remotely must be performed remotely; however, office work may be performed provided work done in conformance with COVID-19 protections provided in EO 161 

DHHS: Opioid overdoses surge during COVID-19 pandemic

“Emergency Medical Services (EMS) and emergency departments (EDs) in Michigan have both seen substantial increases in opioid overdoses since the beginning of the COVID-19 epidemic,” the Michigan Department of Health and Human Services said in a release this week.

According to statistics gathered by MDHHS, EMS responses for opioid overdose increased by 33 percent from April to May of this year. Additionally, EMS responses for opioid overdoses from April through June 2020 were 26 percent higher than the same period in 2019. EMS responses for opioid overdoses increased for all regions and nearly all demographic groups.

The data provides other insights on how the pandemic has impacted the opioid crisis, DHHS noted. Patients were more likely to refuse transport to EDs in April to June compared to the same period in 2019. The percentage of opioid overdose EMS responses that resulted in the patient declining transport to EDs nearly doubled from 7.7 percent April to June 2019 to 14.3 percent April to June 2020.

After an initial drop in April, ED visits for opioid overdoses increased in May and June to pre-pandemic levels despite EDs seeing fewer visits overall in Michigan during the pandemic. The total number of ED visits April to June 2020 declined 38 percent compared with April to June 2019, while the number of opioid overdose ED visits increased by 2 percent. It is too early to determine if opioid overdose deaths have increased following the onset of the pandemic due to the length of time required to finalize death certificates.

Also this week, Judge Patricia Perez Fresard of the Wayne County Circuit Court heard arguments from the defendants’ motion to dismiss the state’s claims against drug distributors, including Cardinal Health Inc., McKesson Corp., AmerisourceBergen Drug Corp. and Walgreens. 

“Among other defenses raised, defendants denied having a duty to prevent illegal diversion of opioids, and further claims d they are insulated from liability under Michigan’s Product Liability Act.  Contrary to defendants claims, the State argued that defendants do have the duty and responsibility to ensure that these highly addictive medications are not diverted into illegal distribution and further that the Product Liability Act, which provides a defense to a defective product claim when a drug is FDA approved, does not protect defendants from responsibility for their illegal distribution and exacerbation of the opioids epidemic.”

For more information about overdoses and resources for prevention and treatment, visit Michigan.gov/Opioids.

 

One week left to register for the 2020 Virtual Annual Conference

Legendary Michigan State University coach Tom Izzo will address attendees of the 2020 Virtual Annual Conference LIVE on Aug. 20 at 11 a.m.. After his remarks on leadership and team building, the national championship coach will take questions.

 

The live chat will be one of the highlights of the 2020 MAC Virtual Annual Conference, which will include events on days between Aug. 18 and Aug. 27.

 

Other highlights include:

• Plenary sessions that will feature MAC’s Legislative Update, the semi-annual “State of MAC” report and an address by MAC Board President Veronica Klinefelt
• The Annual Business Meeting, during which members will vote on MAC’s policy platforms for the 2020-21 year
• Seven policy workshops that will focus heavily on the implications of COVID-19 for counties in the coming months
• A Virtual Exhibitor Show that will allow attendees to select up to five firms from which to hear 10-minute presentations

The unique nature of this event also brings changes to registration procedures:

• The conference registration fee is only $50 for members, which includes all county officials
• Attendees must register by a new deadline prior to the event – Aug. 7
• MAC will not accept “walk-up” registrations during the conference (this is due to credentialing and election procedures adopted for the conference)

Start your registration with our Attendee Packet.

 

Treasury sets Aug. 18 webinar on pension, OPEB planning

On Aug. 18, the Michigan Department of Treasury will host a webinar event to assist local governments in the management and sustainability of their pension and retiree health care (OPEB) systems. This webinar, which will run from 2 p.m. to 3:15 p.m., provides additional resources in response to ever-changing economic conditions.

Topics will include updates from the Municipal Employees Retirement System (MERS) and the Michigan Association of Public Employees Retirement Systems (MAPERS) on local pension and health care systems, problem solving and management of legacy debt from MSU Extension, University of Michigan, and the Citizens Research Council, and an update regarding reporting data, waiver applications, and the corrective action process for Public Act 202 of 2017 from the Department of Treasury.

Participants can register on the webinar’s registration page. Questions may be submitted during registration or sent to LocalRetirementReporting@michigan.gov by Friday, Aug. 14.

The event will be hosted using Microsoft Teams Live. A link to the webinar will be provided upon registration. Upon registration, instructions on how to use Microsoft Teams will also be provided. A recorded copy of this webinar and the PowerPoint will be made available after the webinar is completed on www.Michigan.gov/CEFD.

Additionally, the Michigan Department of Treasury has developed a webpage with numbered letters, memorandums, webinars, and resources regarding COVID-19 updates for local governments and school districts. This webpage was created to ensure that Michigan communities have access to the most up-to-date guidance and is updated frequently with information and resources as they become available. 

 

Staff picks

• Opioid abuse surges in Michigan amid misery of coronavirus (Bridge Magazine)
• In Michigan, closing the digital divide can unite the red and the blue (Brookings Institution)
  
  
• Legislative Watch: Homelessness in the COVID era (Governing Magazine)

• Lockdowns could be the ‘biggest conservation action’ in a century (The Atlantic Magazine)

FY20 budget deal uses federal COVID aid to compensate counties for revenue sharing cuts

Legislative leaders and the Governor’s Office reached final agreement this week on a plan to balance the current FY20 state budget by making large cuts to state spending and backfilling them with federal COVID aid dollars.

Of note for counties is a $97 million cut in revenue sharing from the state, backfilled with $150 million in federal aid that has some restrictions.

So, the August revenue sharing payment will not go out as a revenue sharing payment. Instead, the state will be sending out payments to local governments out of a new $150 million pot of CARES funding. The amount that will be sent to each unit eligible for the August revenue sharing payment will be based on their proportion of the total pot of the $97 million that was cut.

If your county, for example, was getting 2 percent of the $97 million, you will get 2 percent of the $150 million.

MAC has confirmed that this will be a disbursement, but it is assumed at this point that counties will have to issue a report back to the State certifying that the funds were allocated to COVID-19-related expenses. Eligible allocations would include non-reimbursed public health and public safety payroll expenditures, personal protection equipment and facility modifications.

In addition to the revenue sharing changes, the budget bill has also extended the July 17 deadline to apply for the payroll reimbursement program. The deadline to apply for that now will be one week from the time this supplemental budget is enacted. This was done to accommodate those entities that were not originally eligible to apply for the funds, included public safety authorities and district health departments. 

For more information on this issue, contact Deena Bosworth at bosworth@micounties.org.

Izzo added to 2020 Virtual Annual Conference line-up

A special address from legendary Michigan State University coach Tom Izzo will be one of the highlights of the 2020 MAC Virtual Annual Conference, which will include events on days between Aug. 18 and Aug. 27.

Izzo will address the President’s Gathering scheduled for Aug. 20 during the virtual event, which replaces MAC’s traditional summer conference shelved due to the public health circumstances imposed by the coronavirus.

Highlights of the event include:

• Izzo’s remarks on Aug. 20, starting at 11 a.m.
• Plenary sessions that will feature MAC’s Legislative Update, the semi-annual “State of MAC” report and an address by MAC Board President Veronica Klinefelt
• The Annual Business Meeting, during which members will vote on MAC’s policy platforms for the 2020-21 year
• Seven policy workshops that will focus heavily on the implications of COVID-19 for counties in the coming months
• A Virtual Exhibitor Show that will allow attendees to select up to five firms from which to hear 10-minute presentations

The unique nature of this event also brings changes to registration procedures:

• The conference registration fee is only $50 for members, which includes all county officials
• Attendees must register by a new deadline prior to the event – Aug. 7
• MAC will not accept “walk-up” registrations during the conference (this is due to credentialing and election procedures adopted for the conference)

Start your registration with our Attendee Packet.

For questions, send an email to conference@micounties.org.

Treasury webinar details deadlines, guidance on COVID funds      

Counties confront a July 17 deadline to apply for reimbursements for public safety and public health payroll and benefit expenses for the employees substantially dedicated to responding or mitigating COVID-19 for the months of April and May 2020, Treasury officials told attendees of a webinar on Thursday.

The Michigan Department of Treasury presented information on the application process for counties and other local governments to receive funds appropriated through Senate Bill 690 from the $3 billion Michigan received in federal CARES Act funds. For those that were unable to watch the hour-long webinar, you can view the recording here.

The department also covered the water utility assistance program, the first responder hazard pay program and the $200 million for reimbursement of public safety and public health payroll and benefit costs for April 2020 through July 31, 2020. 

In response to a MAC question, Treasury said facility staff that have been deployed for cleaning, sanitizing or modifying work spaces to protect against the spread of the virus would be considered eligible as part of protecting public health and safety. If not all of the $200 million dedicated for this reimbursement is utilized in the first round of applications due on July 31, then a second round will be announced in August.  Round 2 will cover the April and May expenses not already reimbursed and any of the same expenses incurred during the months of June and July. These funds will be prorated based on the percentage of the total filed claims, so it may not reimburse 100 percent of the expenses submitted. Distribution of the funds for the first round is anticipated to go out by Sept. 18, 2020, and the second round by Nov. 7, 2020. 

As for the $100 million allocated for a $1,000 per first responder hazard pay program, Treasury said the application period is now through Sept. 30, 2020, but is on a first come, first served basis.

Although MAC read the boilerplate language in Senate Bill 690 to indicate that the funds were either payments ahead of expenditure or reimbursement for those that had the funds to give, the department has not made that clear at this point. It was indicted during the webinar that the payments must be made to the first responders by Sept. 30, 2020. However, the checks from the State to the county would go out no later than Nov. 14, 2020. This would not indicate a pre-payment program. A commitment was made by the presenters to look more into this process. Please remember, these funds are first come, first served, so get your applications moving.

MAC will be hosting a webinar its own webinar at 11 a.m. on Monday, July 13 to discuss these issues in more detail. Click here to register.

For more information on this issue, contact Deena Bosworth at bosworth@micounties.org.