Dec. 2, 2022 | This Week in Government: Detroit Regional Chamber Lays Out Priorities to New Legislature Leadership

Using economic incentives to attract major projects and boost job numbers, improving education and job training programs, and working to prepare the state for vehicle electrification are among the key priorities the Detroit Regional Chamber is hoping to work on with the next leaders of the Legislature.

Items under the categories of promoting economic growth, equitable opportunity, and promoting civility were included in a letter provided Wednesday to the incoming leaders for the next term. The letter was sent to Sen. Winnie Brinks (D-Grand Rapids) and Sen. Aric Nesbitt (R-Porter Township), who will be the next majority and minority leaders, respectively as well as to Rep. Joe Tate (D-Detroit) and Rep. Matt Hall (R-Comstock Township), the next House speaker and minority leader, respectively.

“As you prepare to lead the state – to capitalize on our opportunities and address our challenges – I share the following perspective from the Chamber in the hope that the new Legislature will take the opportunity to govern from the broad center, rack up some early bipartisan wins, and advance Michigan’s competitive position in the global economy,” Sandy Baruah, the Chamber’s president and chief executive officer, wrote.

A key item listed under promoting economic growth was creating a stable revenue source for the Strategic Outreach and Attraction Reserve Fund. Baruah said this would help the state remain competitive in attracting a highly educated workforce to fill critical jobs.

He also wrote that the state’s manufacturing and engineering heritage should be separate from competition with efforts to build the state’s skilled workforce overall.

“The stark reality is that Michigan must capitalize on our manufacturing competitive advantage today and make major improvements in our educational attainment and skill levels. This is not an ‘or’ conversation,” Baruah wrote.

As to education, the Chamber urged lawmakers to work together to improve the state’s K-12 education system by focusing on student achievement and funding equity-based models along with increasing spending on higher education, from community colleges and skilled certificate programs on up through four-year institutions. The group also supports increasing funding by $45 million for the Going Pro Talent Fund.

Supporting the expansion of electric vehicle infrastructure was also a priority.

Under the category of equitable opportunity, the Chamber urged an expansion of the Earned Income Tax Credit and to expand the Elliott Larsen Civil Rights Act to include LGBT rights.

Civility in government was another item on which the Chamber urged action.

“Washington continues to set a poor example for civility, productivity, and efficiency,” Baruah wrote. “In Michigan, we can do better – and you can lead the way in the new Legislature.”

To that end, Baruah wrote that within the Legislature, members should create a bipartisan Problem Solvers Caucus like that of which U.S. Rep. Debbie Dingell (D-Ann Arbor) and U.S. Rep. Fred Upton (R-Saint Joseph) have been members of for multiple terms.

The sponsor of bills extending exemptions and modifying assessments for properties, including convention centers and major shopping districts in places like Detroit, said his proposals could help stimulate economic growth if enacted into law.

Sen. Wayne Schmidt (R-Traverse City) told reporters Tuesday following the session that local communities should have the tools to help boost business districts and provide ways to keep them strong during potential future economic downturns.

That was the purpose of SB 1221, SB 1222, SB 1223, and SB 1224, bills that were introduced earlier this month.

“It wasn’t any particular package, but it is just [an] accumulation of several different bills to help stimulate more growth in our economy,” Schmidt said.

Under SB 1221, the Michigan Renaissance Zone Act would be amended to allow the Michigan Strategic Fund Board to extend the duration of a specified renaissance zone status in Oakland County for up to 15 years if the board found that an extension would increase capital investment or job creation in the state.

For SB 1222, several changes would be made to the Regional Convention Facility Authority Act. Several definitions would be amended, including the definition of “qualified city,” so the population threshold would be reduced from 700,000 to 550,000.

The bill also would remove a prohibition on a convention facility authority from spending more than $279 million to develop and expand or renovate a facility and would remove the $279 million cap on contracts for the development of an expanded or renovated facility.

Several changes to the State Convention Facility Development Act would be made under SB 1223, including changes to the maximum amount the state treasurer can release from the Convention Facility Development Fund to qualified local government units.

Under the bill, bonds would be excluded that were issued by a metropolitan authority that became a qualified local government unit after Dec. 1, 2008, from specified requirements regarding the refunding of bonds, obligation, or other evidence of indebtedness.

The final bill, SB 1224, makes several changes to the statute governing the principal shopping district and business improvement zones.

Schmidt explained that provisions within some of the bills are targeted toward providing more funding for facilities such as Huntington Place in Detroit.

“I always remind people that the number one tourist destination in Michigan, it’s not Mackinac Island or Traverse City or Frankenmuth, and as much as those are all great. Detroit, because convention, hotels, the convention space, pro sports, all of it, it’s a great city,” Schmidt said. “This goes back to allowing more flexibilities for the locals. … I want to make sure that Michigan continues to go forward, and these tools help do that.”

There was no debate on the bills prior to Tuesday’s votes, but there was opposition among members. Of the bills, SB 1223 passed 27-10. Two others, SB 1222 and SB 1224, passed 24-12, and SB 1221 passed 21-15.

Before he leaves office, outgoing Sen. Adam Hollier of Detroit wants to tell a new story about Michigan at the U.S. Capitol.

Hollier is leading the effort to replace the Michigan statue of Lewis Cass in the National Statuary Hall Collection with one of Coleman A. Young, Detroit’s first Black mayor.

“Each and every one of these statues is representative of a state, so that a state can say with that person that they identify and highlight the values of that state. And Lewis Cass no longer represents the values of this state,” he said. “It’s about who are we elevating? Who are people going to have to learn about to understand their history. … It’d be telling a story that was meaningful to me, meaningful to the people who I represent, that’s inclusive and understand of how are state has become better.”

Since the mid-1860s, each state has been allowed to donate statues in marble or bronze of two distinguished but deceased individuals to be part of the National Statuary Hall Collection in the U.S. Capitol. Michigan gifted the marble Cass statue to the collection in 1889, and it has a prominent location in the hall, which served as the original House chamber.

Cass was a territorial governor of Michigan in the 19th century, supported slavery, and oversaw the forced removal of tens of thousands of Native Americans from their lands as secretary of war under President Andrew Jackson.

Recently, the state has been reevaluating Cass’s legacy (See Gongwer Michigan Report, July 2, 2020). In 2020, Gov. Gretchen Whitmer renamed the state Department of Health and Human Services building to the Elliott-Larson Building. It was originally called the Lewis Cass Building.

Hollier believes it’s time to do the same with the statue of Cass in Washington, D.C., and replace it with someone who better represents Michigan’s values.

Young, who died in 1997, was the first Black mayor of Detroit, fought in World War II as a Tuskegee airman, pushed back against McCarthyism, advocated for civil rights, and served as the second Black man in the state Senate.

“We talk about ourselves as the motor city, as the auto capital, as a place where we get things done, and that’s Mayor Young. We talk about the role we played in World War II as the arsenal of democracy, and the Tuskegee airmen have come to signify what we did in World War II. And that’s Coleman Young,” Hollier said. “So many people say these names don’t really matter. They don’t mean anything. They mean something to me.”

Hollier has been working on this project the entire legislative term, but whether he can get it done during his time in office will depend on the House’s lame duck agenda next week.

He’s already made his case for a statue of Coleman Young in the Senate, which adopted a resolution, SCR 23, in support of the measure in June.

Now, the resolution must make it through the House.

Rep. Mike Mueller (R-Linden) chairs the House Government Operations Committee, where the resolution sits in the House, and is in favor of moving it forward.

“Representative Mueller has been an incredible partner and champion for me in the House, and I think the House is going to honor its tradition that Republicans choose the Republican– they chose Gerald Ford– and Democrats choose the Democrats,” Hollier said.

Mueller did not respond to a message on Tuesday about the resolution, but he told the Detroit News during a recent interview that he viewed it as a non-political matter.

“We’ll see if we can move it forward,” he told The Detroit News. “It’s courteous, and it’s the right thing to do.”

Hollier said that this measure was process-oriented and was focused on bipartisan cooperation.

“I think it’s important to be able to show that Republicans and Democrats can do something that honors tradition,” he said. “It says not ‘What statues should we be taking down?’ but ‘Who are we lifting up? And who do we want people to recognize with us.’”

That was something Republicans did when they chose to send a statue of former President Gerald R. Ford to the collection in 2011 to replace a statue of Zachariah Chandler, one of the founders of the Republican Party.

Hollier acknowledges that Young isn’t an uncontroversial figure, but that’s not what matters.

“The way that we govern causes us to have enemies, oftentimes on the other side, people who would prefer to see someone else in that space, but by honoring a tradition like this, it allows us all to pick the person who truly represents us,” he said. “I’m really grateful that we live in a space where people understand the tradition of our Legislature and are willing to honor it and get this thing done.”

The House is scheduled to be in session next Tuesday and Wednesday, with a tentative day scheduled for Thursday.

If the measure passes, the next step would fall to Whitmer, who would send a letter to the Architect of the Capitol requesting to provide a new statue and explaining where the old statue of Cass would be displayed in the state after it’s removed. She also would have to supply a copy of the Legislature’s resolution authorizing the replacement.

A group advocating for the expansion of the Earned Income Tax Credit said Wednesday the Legislature should pass it in the current term rather than waiting until next year when the Democrats will have control of all three branches of state government.

Lou Glazer, president of Michigan Future Inc. and Kent County Treasurer Peter MacGregor, a former lawmaker, told reporters if Gov. Gretchen Whitmer and Democratic majorities of the House and Senate pass the EITC expansion next term, it would take effect in the 2023 tax year.

This means, they said, that individuals claiming the credit would get the money in 2024. If Whitmer and the GOP-led Legislature come together this month, those claiming the credit could do so early next year.

While the coalition is pushing for action this year, the Whitmer Administration also said it is hopeful the Legislature moves the expansion during lame duck. Republican leaders, however, have said the governor’s office isn’t negotiating in good faith.

Currently, 730,000 households get the EITC raising a million kids, which is 6 percent of the federal credit. It was reduced under former Governor Rick Snyder during a tax overhaul in 2011. The current average is $150 per household. By increasing it to 30 percent, as currently proposed under a bill from Sen. Wayne Schmidt (R-Traverse City), the average credit would increase to $750.

MacGregor was a member of the House when the Legislature and Snyder reduced the EITC in 2011. He said they had to do it then, but now the state has the money to expand the credit.

“We have the revenue to do this. This is such a simple, easy, effective, huge impact on working families,” he said. “To me, now is the time. We really didn’t have the ability over the last 10 years to do this because general fund dollars were at a premium. Boy, right now, I think the Legislature is tripping over the money that they have available.”

MacGregor said Republicans and Democrats are still playing games even though the election is over.

“Before the election, the Republicans didn’t want to give the governor the win. Now it’s after the elections and the Democrats want to wait until 2023 so they can get the win. But they’re all being selfish because if they wait until 2023, there are going to be no winners because working families are going to have to wait another year and a half before they can get this money,” he said. “They do it now, they’re doing it for those working families, whether you’re Democrat or Republican. And that money is going to help out our economy, it’s going to help out our businesses. To me, it’s so simple. But, of course, that’s easy for me to say, I’m out of the Legislature now.”

Glazer said the coalition had been told, at least at the staff level, the governor’s office and legislative leadership are discussing the EITC expansion coming up during lame duck.

And MacGregor said Sen. Jim Stamas (R-Midland) and Schmidt are going to “work their tails off” to get it done.

Still, in terms of session days that are scheduled, lame duck could be quite short. The Senate held a lengthy session day on Tuesday, and the EITC bill did not come up. The House is only scheduled for Tuesday and Wednesday next week, with Thursday as a tentative session day. The Senate is currently scheduled to come back on Tuesday.

That leaves two options: a vehicle bill could be used if the House and Senate are only in next week, or they could come back the third week of December.

House Speaker Jason Wentworth (R-Farwell) on Tuesday said the governor was not negotiating in good faith on lame duck items. He expressed a willingness to hold session the third week of December but said if Whitmer wasn’t willing to sign any of the bills they pass, it isn’t worth it.

“We have an opportunity here to work together,” he said Tuesday.

On Tuesday, Whitmer’s office touted its accomplishments working with the Legislature during the current term but did not address the specifics allegations.

On Wednesday, Communications Director Bobby Leddy noted Whitmer proposed an EITC expansion as part of her budget proposal almost a year ago.

“Nearly a year ago, Gov. Whitmer put forward a plan to put more money back into people’s pockets by expanding the tax credit for working families, averaging out to $3,000 in savings for 730,000 families,” Leddy said. “There is bipartisan support for her proposal, and we are hopeful this current Legislature will get this done to deliver targeted relief for hard-working families across the state. If the Legislature isn’t able to do it this year, it will be the first thing on our list for next year with the newly-elected Legislature.”

On Tuesday, grant monies from a major state economic development incentive program received approval from the Senate Appropriations Committee, providing funding toward a proposed significant western Michigan wastewater project.

By a 15-3 vote, the Senate panel approved Legislative Transfer Request 2023-1, which would provide a $60 million performance-based grant through the Strategic Outreach and Attraction Reserve Fund to the Southeast Regional Force Main project.

Money from the SOAR Fund Strategic Site Readiness Program would allow Coopersville to redirect wastewater north to the Muskegon County Resource Recovery Center.

The additional wastewater capacity would allow for additional growth by several companies in the region, with expected capital spending of $187 million by industry and leading to 145 new jobs.

Funding for the project was part one of several items that the Michigan Strategic Fund Board gave approval for in October, including two large electric vehicle battery production sites (See Gongwer Michigan Report, Oct. 5, 2022).

Under the rules for SOAR Fund projects, legislative approval by both appropriations committees is needed for final approval.

Voting no on the request was Sen. Rosemary Bayer (D-Keego Harbor), Sen. Jeff Irwin (D-Ann Arbor), and Sen. Jim Runestad (R-White Lake).

Senate Appropriations Committee Chair Jim Stamas (R-Midland) told reporters he would see whether the two chambers can come together next week in agreement on the $60 million grant and the remaining SOAR Fund projects that are still being weighed.”I think that they’re all good projects,” Stamas said.

Two of the other projects awaiting legislative approval are electric vehicle battery facilities.

The first project is a $2.36 billion EV battery plant to be built near Big Rapids by Gotion, a subsidiary of an EV battery company based in China that has locations in the United States.

A second project, a $1.6 billion battery manufacturing campus to be built by Novi-based Our Next Energy, would be located in Van Buren Township.

The Gotion incentive package includes two SOAR Fund performance-based grants. The first is a $125 million Critical Industry Program grant, and the other is a $50 million Strategic Site Readiness Program grant. The latter grant will be administered through The Right Place, a western Michigan economic development organization that helped secure the project. The state also approved a Designated Renaissance Zone Wednesday for the project totaling $540 million. Local governments in the project area also have approved a project-related, 30-year renaissance zone.

For the Van Buren Township project, the ONE Circle facility will also receive an incentive package, including SOAR Fund grant dollars. A $200 million Critical Industry Program grant was awarded. Included in the package is a State Essential Services Assessment Exemption of $21.6 million and a $15 million Jobs for Michigan Investment Fund loan.

“The Gotion has had certainly some controversy, especially over the election period, which has caused some of our members to have serious concerns,” Stamas said, referencing former gubernatorial candidate Tudor Dixon’s attacks related to the project due to the company being a U.S. subsidiary based in China. “The other ones I think … also have great merits. I have not heard as many concerns.”