A new report unveiled at MAC’s 2017 Legislative Conference could help the state take a broader view of the importance of proper funding for county services, MAC’s Deena Bosworth told MIRS News Service Thursday.

The study, Counties in Michigan: An Exercise in Regional Government, details the advantages that counties already offer in the pursuit of greater collaboration on public services and improved efficiency.

“(CRC) is not advocating a one-size-fits-all solution to  regional  government  in  Michigan,  but  rather  a  move to thinking of local government more in terms
of the region and what county government can do in a more effective and economical manner than a city, village, or township can do,” the report concludes.

Speaking at the MAC conference Tuesday, Gov. Rick Snyder said Michigan should look to invest more in local services. MAC will be urging the governor and his administration to work with the Legislature to translate that concept into tangible changes in state budgets and regulations as the legislative session continues in 2017.

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’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.

The 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.

In 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