What you need to know about Legislature's 'lame-duck' session

A post-election headline in Bridge summarized expectations for an "active" “lame duck” session of the Legislature.

We didn’t know the half of it.

Ending at 4:30 a.m. last Friday, the Michigan Legislature passed almost 300 bills in the holiday season, including fundamental changes in how Michigan handles unions, business taxes, abortion regulation, welfare limits and even the rules by which voters can remove legislators from office.

Don Gilmer served more than two decades in the Michigan House in the 1970s, '80s and '90s:

"I don't remember anything like we saw in 2012."

He draws a line between today's circumstances and the enactment of term limits in the early '90s.

"When I was there, we always had a Legislature that had seasoned members. ... Issues that had a strong partisan philosophical flavor to them generaly got debated much more extensively -- not the type of things you threw in at the last second with sine die (final adjournment) looking you square in the face.

Dave Hollister, who served for almost two decades in the House before becoming mayor of Lansing in the 1990s, thinks 2012 will be an "outlier."

"I don't think it will carry forward in the future," Hollister said, "The (House) majority is going to be cut next year and Michigan has had a divided government generally in recent decades."

Hollister was, however, highly critical of the ideological cast of recent events: "This whole session has not been one of collaboration or attempts to build consensus. The majorities in both houses and the governor ran roughshod all over legitimate concerns and just imposed an ideological agenda, with a couple of paybacks in the process."

Gilmer says that legislators now face a "learning ladder" rather than a learning curve and that citizens can expect to see more tumultuous lame-duck sessions in the future if term limits aren't lengthened so lawmakers can build up their experience.

"It makes me glad I'm not a legislator anymore," Gilmer said.

Among the most significant actions taken – or not – in recent weeks were:

Right to Work

What: Adoption of rules that allow employees to skip contributions to unions, either via union dues or so-called agency fees (for negotiated benefits) for private and public-sector unions.

Legislative action: After the most acrimonious debate in recent memory, the Legislature approved Right to Work bills bitterly opposed by labor unions and the Democratic Party.

Snyder says: Gov. Rick Snyder signed RTW legislation shortly after it cleared the Legislature last week.

Public impact: It depends. Advocates say Right to Work status will increase interest in Michigan from manufacturers around the globe. The economic prospects of RTW states vs. non-RTW states are mixed, with advocates and critics wielding statistics on growth vs. those on income rates, for example. Academics say unions will lose money as workers, who gain benefits from contracts negotiated by unions under provisions of federal law, will choose not to pay dues or fees.

“Unions will have less revenue. They’ll be weaker, with less money to organize, to service the employees they have. Arbitration, grievances, etc. They’ll struggle,” said Robert McCormick, a professor at the Michigan State University College of Law.

“I answered in excess of 80 requests for information this year,” said Birgit Klohs of the Grand Rapids economic development group The Right Place, “and with the exception of one or two, everybody asks (the Right to Work) question. Those are companies that are looking to expand in Michigan.”

Welfare limits

What: A state law imposing a 60-month lifetime limit on cash assistance to needy families.

Legislative action: The bill prohibits the DHS from providing assistance to “any group that includes an adult who has received TANF-funded FIP assistance for more than 60 months, whether consecutive or not, after October 1, 1996.” The bill codifies a policy adopted by the Department of Human Services more than a year ago. That DHS policy has been contested in state courts.

Snyder says: The governor is expected to sign the legislation.

Public impact: The first year of Michigan’s tighter welfare rules saved state taxpayers money. Michigan is spending about $18 million per month less on such aid than in the past, though an improving economy is one factor in those savings. Social service advocates say the result has been more stress on needy families. DHS, however, is not tracking how former recipients are faring in the job market.

Personal Property Tax cut

What: Multi-year phase-out of personal property tax.

Legislative action: The Snyder administration won in its year-long effort to repeal the PPT on industrial property – maybe.

The Legislature, after wild day last Thursday in which an immediate cut, without replacement funds to local governments was bruited, reverted back to the administration’s idea this fall to divert part of the state’s use tax to cover the loss of funds from personal property tax repeal on industrial property.

In a victory for local governments, the phase-out of the PPT on industrial property is linked to the results of a statewide vote, planned for 2014, to divert part of the state’s 6 percent use tax to the compensation fund. If voters reject the diversion, the PPT phase-out halts. http://legislature.mi.gov/doc.aspx?2012-HB-6026

Snyder says: The governor is expected to sign the bills.

Public impact: Manufacturers have been keen to do away with the PPT as the levy, which is actually a tax on business equipment, hits them the hardest. Interest in PPT repeal grew after the 2011 legislative session in which the conversion of the state’s Michigan Business Tax to a Corporate Income Tax actually left large corporations that had received plenty of MBT credits in a more difficult tax situation.

Local governments, which rely on PPT revenue, had argued that any repeal should come with replacement revenue. The legislation approved last week would replace some of the revenue, but not all of it.

School districts are supposed to be held harmless from losses of PPT revenue – again from use tax diversions.

Educational choice

What: A proposal to expand choice in public schools, particularly via online courses and specialized charter schools.

Legislative action: Two pieces of legislation that gained the moniker “super choice” received legislative hearings and plenty of pushback from education groups after State Board of Education President John Austin referred to them as a “nuclear bomb.”

Snyder says: The governor is expected to push educational choice in the 2013 legislative session.

Public impact: For now, it’s status quo. And with the Republican majority reduced in the next House of Representatives, the chances for a major revamp on school choice may be lessened in 2013.

Recalls

What: Fundamental changes in how Michigan’s recall law works.

Legislative action: Recalling state officials, such as legislators, will be far more difficult under new rules. Among the major changes:

* Recall elections, when held, will now be candidate contests between the incumbent targeted and a nominee of another party. Michigan’s past practice has been to use a recall as a referendum on whether to keep the incumbent.

* Citizens will now have 60 days to collect signatures, rather than 90.

* Recall petitions now have to be “factual,” as opposed to “clear” as under the old standards.

* Recall petitions aimed at state officials now go before the Board of State Canvassers, a four-person panel whose membership is split, by law, between the two major parties.

State officials with terms beyond two years (such as senators and governors) cannot face recalls in the first and last years of their terms.

Snyder says: The governor had not given an indication of his plans on the legislation.

Public impact: Only three state lawmakers have been recalled in the last 30 years, nevertheless the Legislature adopted a law that makes recalls significantly more difficult and more expensive.

Blue Cross Blue Shield conversion

What: Blue Cross will be allowed to become a nonprofit mutual insurance company by paying a fee to create a new charitable state health account.

Legislative action: Blue Cross, which has operated as Michigan’s charitable insurer of last resort, can reorganize itself. In so doing, it can increase rates it charges for so-called Medigap coverage for seniors. Added to the legislation late was a provision that makes abortion coverage under health insurance plans an “opt in” rather than “opt-out” program, which critics say will make such coverage more difficult for women to obtain.

Snyder says: The governor is expected to sign the bills.

Public impact: Seniors can expect to pay more for Medigap coverage in the future. The impact of the new Blue Cross-funded state health account is unclear. Other health insurers were pleased by a provision that blocks Blue Cross from using its large market presence to require health providers (such as hospitals) to give it highly favorable payment rates.

Emergency managers

What: New emergency manager law to replace 2011 version

Legislative action: In the wake of the repeal of PA 4 of 2011, the Legislature drafted a new version of rules for how emergency managers operate in distressed communities. Though EMs will consult more with local officials on major actions, they retain broad powers to address spending.

Snyder says: The governor backed the 2011 EM rewrite and asked voters not to repeal it via referendum. They rejected his advice. This tweaked version includes more input from local officials on EM actions – and an appropriation to make it referendum-proof. Snyder will sign.

Public impact: Most of the heat surrounding the 2011 EM law focused on the broadened powers for EMs over elected local officials and, potentially, over union contracts. Somewhat lost in that debate was the question of: What to do with local governments whose finances have gone from bad to disastrous?

There are eight local agencies with managers now. The initial impact will be concentrated there.

School bond program

What: Limitations on state subsidy program for school district capital bonds.

Legislative action: The Legislature approved limits to a state program that subsidizes borrowing by schools for construction and other capital needs. The Snyder administration had argued the subsidies were diverting state school aid money away from other needs.

Snyder says: The governor is expected to sign the legislation.

Public impact: While the state impacts to save millions in reduced subsidies for school loans, school districts expect to encounter higher loan costs.

Abortion restrictions

What: Requirements for the administration of abortion procedures.

Legislative action: House Bill 5711 includes sections on the disposal of “fetal remains,” sanctions for those found to have “coerced” a woman into an abortion and a requirement that a doctor physically assess a patient before prescribing an abortion – thereby barring “telemedicine” techniques.

Snyder says: The governor is expected to sign the bill.

Public impact: Both advocates and opponents of HB 5711 expect it will restrict access to abortion services in Michigan.

Teacher pension payments

What: Extending the deadline for teachers to make pension choices.

Legislative action: A bill was approved to extend deadlines for members of the Michigan Public School Employees Retirement System to choose pension options previously adopted under Senate Bill 1040. This gap legislation was prompted by ongoing litigation involving the pension changes, which were designed to reduce the unfunded liabilities of the MPSERS.

Snyder says: The governor is expected to sign the bill.

Public impact: With major pension changes held in abeyance by litigation, local school districts and the state are picking up an additional $200 million in contributions to MPSERS this fiscal year. Under this bill, and assuming SB 1040 survives legal challenges, those additional costs to the state and schools would fall to $30 million to $40 million.

Senior Editor Derek Melot joined Bridge Magazine in 2011 after serving as an assistant editorial page editor, columnist and reporter at the Lansing State Journal, where he covered state and local issues extensively, earning awards from the Associated Press and Michigan Press Association. The Oklahoma native moved to Michigan in 1999.

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