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Volume #50, Report #27 -- Tuesday, February 8, 2011

Snyder Set To Break Up D.E.L.E.G.

Governor Rick Snyder will soon announce the break-up of the Department of Energy, Labor and Economic Growth and movement of economic development functions to the Michigan Economic Development Corporation, Gongwer News Service has learned.

Multiple sources told Gongwer of the impending changes to one of the state's largest and most critical departments. Snyder communications director Geralyn Lasher confirmed late Tuesday night that Mr. Snyder would issue the executive order within a week. Asked about the transfer of economic development functions to MEDC, Ms. Lasher said, "I think that'd be fair to say."

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Governor Rick Snyder is expected to break up the Department of Energy, Labor and Economic Growth.

According to the sources, what remains of DELEG, which will be renamed, will focus on licensing and regulation. Mr. Snyder also will announce a new director for that department in tandem with the executive order.

Sources said that during the transition period, officials urged Mr. Snyder to split up DELEG and centralize the state's economic development focus.

"If you look at the org chart of DELEG, it is a very large agency, and that's why we wanted to take some time to look at the details," Ms. Lasher said of the process to reorganize the functions within the department.

If the MEDC does take over all economic development functions, it would mean the new MEDC President and CEO, Michael Finney, will have the same degree of oversight on economic development that Doug Rothwell had under the administration of former Governor John Engler. Mr. Rothwell, executive director of Business Leaders of Michigan, is also chair of the MEDC's executive committee.

DELEG is currently being administered by Acting Director Andy Levin, an appointee of former Governor Jennifer Granholm. It is one only two departments where the governor appoints the director that Mr. Snyder has not made major changes to or named a permanent director since his election in November.

The Department of Corrections is the only other department without a new permanent director and is now under the direction of Acting Director Dick McKeon.

Under Ms. Granholm, DELEG was initially given a major focus to deal both with concerns labor had with Mr. Engler's regulation of their issues as well as promote economic development. She had combined the department from the old departments of Career Development and Consumer and Industry Services while also placing a number of autonomous agencies under its watch.

She also eventually gave the department the primary emphasis to promote alternative energy development.

Accreditation Plan Moves Over School Objections

The Board of Education adopted a new accreditation system Tuesday, but it was unclear whether the system would actually be implemented or would be blocked by courts.

Middle Cities Education Association, which represents some of the state's larger school districts, filed a preemptive action to block the Michigan School Accreditation and Accountability System late Monday.

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Superintendent Mike Flanagan accused opponents of delay tactics.

Superintendent of Public Instruction Mike Flanagan said during Tuesday's board meeting that he was not clear why Middle Cities was seeking to block MI-SAAS, which was altered Tuesday to more closely comply with recent education reform legislation.

"There are interests at play here that say let's find another delay," Mr. Flanagan said. "If the injunction prevails, it would be another delay, we wouldn't be able to implement it."

He said the current system is in the interest of particularly some of the lower-performing schools and districts because it essentially grants all school accreditation.

Officials said in recent years the current accreditation system, Education YES! has left some three schools unaccredited, and never for more than a year at a time. Schools that remain unaccredited for more than three years under current law can face takeover by the state.

Mr. Flanagan said the department, now that it had approval of the board, was planning to take the measure to the House and Senate Education committees as the current law requires. He did acknowledge there is some question whether constitutionally the approval of the two committees is needed to implement the new system.

Kacie Kefgen, spokesperson for Middle Cities, said after the meeting that either the committees have to approve the change, as current law requires, or it must be adopted as administrative rules through the Administrative Procedures Act.

Ms. Kefgen said the group filed the legal challenge because, while Mr. Flanagan said the department would not be implementing the program until it was approved by the legislative committees, officials had already instructed districts to begin collecting the data needed under the proposal.

A memo to schools indicated they could begin providing some data as early as December 13, 2010, and school improvement plans beginning February 14, 2011. School process rubrics are due March 11 and all other data is due September 1.

As adopted, the system would preliminarily label the lowest-performing 5 percent of schools as unaccredited, those in the lowest 20 percent as interim accredited, and the remainder as accredited based on the annual ranking the department creates.

Those initial labels would then be adjusted based on the percentage of students taking statewide assessments (less than 95 percent would move a school down) and on the school's compliance with other requirements such as having a school improvement plan and using the state core content standards to develop curriculum.

The plan proposes to remove federal adequate yearly progress measures in determining where a school falls in the statewide ranking, and instead look at the achievement gap between the lowest-performing and highest-performing subgroups within the school. The greater that gap, the more the school could move down that ranking.

The plan as adopted also would use graduation rate, and change in graduation rate, to move a school up or down the list.

Board member Marianne McGuire (D-Detroit) was the only vote against the plan. She argued there were still groups that should have input on the proposal before it is enacted.

CUT SCORES: One of the reasons for axing Adequate Yearly Progress from the MI-SAAS was a proposal to change the cut scores on the Michigan Educational Assessment Program and the Michigan Merit Exam to fall more in line with college readiness.

The board did not approve the specific cut scores Tuesday, but did approve, with only Ms. McGuire in opposition, a call for the department to determine what those scores should be.

The goal is to have proficiency ratings on the test fall more in line with the college readiness rating on the ACT, which is part of the Merit Exam.

Officials have said the change would substantially reduce the number of students scoring proficient on the tests, which would leave many schools not meeting AYP until they can bring those scores back up.

Removing AYP from the accreditation system would avoid having an excessive number of schools become unaccredited due solely to the cut score change.

WRITING SCORES: The board got a bit of a taste of what the change would mean in setting cut scores for writing for the 2010 MEAP test.

The board, at the recommendation of the department, rejected a review panel's recommendation on the proficient cut score for the test to bring the results for the fourth and seventh grades more in line with the Merit Exam (11th grade) scores.

Officials said the Merit Exam scores are in line with the ACT college readiness scores, and provided 40 percent of students with proficient ranking and 4 percent with advanced.

The cut scores initially recommended by the MEAP panel would have provided 9 percent of fourth-graders and 7 percent of seventh-graders with advanced rankings, not out of line with the high school scores. But they would have set 63 percent in each grade as proficient, which is out of line.

The scores adopted by the board would result in 34 percent of fourth graders and 36 percent of seventh graders being proficient, scores that officials said were more appropriate considering the high school outcomes.

ARTS REQUIREMENTS: The board also gave initial approval to grade level expectations for arts education. The standards now go out for public comment with final approval by the board expected in April.

Among the requirements, kindergarteners would be required to identify various body parts by touching and walk with a partner for dance; high schoolers would be expected to choreograph a duet.

The standards would expect similar ranges of growth in music, theater and visual arts.

The arts standards are the final of the content expectations to be set by the department and the board.

House Emergency Manager Bill Removes Local's Power

Local officials who oversaw their government's plunge into financial ruin would have no authority unless the emergency financial manager appointed to oversee reconstruction approves such duties under legislation to be introduced in the House.

Rep. Al Pscholka (R-Stevensville) is sponsoring the legislation backed by Governor Rick Snyder, who called for reforms to the state's emergency financial manager law last month. Mr. Pscholka's district includes Benton Harbor, which is currently under emergency financial management.

Benton Harbor city officials have repeatedly clashed with the emergency manager there, Joe Harris.

Under the bill, managers be would able to renegotiate contracts, sell government assets, set staffing levels and enter into service consolidation agreements without interference from local officials.

"We are appointing people to be protectors of the public interest and they need to have the tools to fulfill that role. At present, we are sending them into these situations just to end up obstructed by local individuals or structural barriers. We need to be clear about the extent of their oversight," Mr. Pscholka said.

The bill also will set up a process for the state to help financially distressed local governments before bankruptcy.

Additional 'Pure Michigan' Funding Clears First Hurdle

The state is on its way to spending $25 million a year on the popular "Pure Michigan" advertising campaign after a bill using 21st Century Jobs Fund money passed a House committee unanimously on Tuesday.

Clean Water Action reacted to the vote by saying lawmakers should be just as dedicated financially to cleaning up the state's waterways as they are to highlighting them in the ads.

"If lawmakers can set aside the money to market our Great Lakes way of life, they should also set aside the money to protect our water and other natural treasures from pollution so our citizens and tourists can enjoy our lakes and rivers for years to come," said Cyndi Roper, Clean Water Action's Michigan director.

The group noted funding for the state's pollution monitoring and enforcement has dropped to $25 million from $100 million 10 years ago.

The legislation (HB 4160[log in to unmask]" alt="*">), reported from House Natural Resources, Tourism and Outdoor Recreation, adds tourism promotion as a permanent eligible activity for jobs fund money, and Governor Rick Snyder will make good on his call for Pure Michigan ads to receive $25 million annually in his February 17 budget presentation, Jim McBryde with the Michigan Economic Development Corporation told the panel.

Mr. Snyder is expected to present is 2011-12 fiscal year budget, as well as recommendation for spending in the 2012-13 fiscal year.

The committee amended the bill to require the MEDC provide a report to legislators on where the $25 million goes each year. The MEDC produces several reports each year, some of which already go to Appropriations Committee members, but this would extend the distribution of information.

"I think it's important to be able to go back to our constituents and show we've been prudent with their money," said Rep. Matt Huuki (R-Atlantic Mine), the amendment's sponsor.

The Legislature and governor first created the jobs fund in 2006 by securitizing some of the state's future tobacco settlement revenue.

NATIONAL FOREST: The committee also reported two measures (HCR 2[log in to unmask]" alt="*"> and HR 17[log in to unmask]" alt="*">) expressing lawmakers' opposition to a lawsuit aimed at stopping firearm hunting and snowmobiling in part of the Huron-Manistee National Forest.

The U.S. Forest Service, while reviewing its Land and Resource Management plan of the forest after a U.S. 6th Circuit Court of Appeals ruling, has been sued to halt hunting and snowmobiling in all primitive areas and semi-primitive non-motorized management areas, which is about 70,000 acres.

But supporters of the resolutions said stopping those recreational activities would have a negative effect on the economy of northern Michigan.

"They eat in our restaurants, and they enjoy the great north as they should," said Rep. Peter Pettalia (R-Presque Isle).

The resolutions were reported on nearly unanimous votes with Rep. Tim Bledsoe (D-Grosse Pointe) abstaining. Mr. Bledsoe pointed out the lawsuit relates to 7 percent of the forest's total acreage.

The Michigan Snowmobiling Association, Michigan Lodging and Tourism Association and Michigan United Conservation Clubs support the resolutions. There was no testimony in opposition.

Scott Expecting Child With Former Legislative Aide

Rep. Paul Scott (R-Grand Blanc) confirmed Tuesday he is having a baby with his former legislative aide and campaign manager.

Mr. Scott, a 28-year-old single lawmaker serving in his second term, said he met Amanda Grove when he first took office in 2009 and was interviewing staff for his legislative office.

The two developed a romantic relationship over time and she left his staff in May of last year to manage his campaign for secretary of state. He eventually lost the Republican nomination for that office.

Mr. Scott has been one of the most socially conservative lawmakers, opposing abortion and same-sex marriage and saying during his secretary of state race that he would prohibit transgendered residents from changing the sex listed on their driver's license.

Asked about how conservatives may react to the news, Mr. Scott said there are many members of the Republican Party who are anti-abortion and his child is a "blessing."

"The Lord works in mysterious ways," he said.

Ms. Grove, who did not return to work in the Legislature, is due in a few weeks. Mr. Scott said the two have a close relationship and are focusing on the healthy birth of their son.

Road Groups Urge Senators To Fund Transportation

The state lacks sufficient money to run even a moderately serviceable road construction, repair and maintenance program, and officials must find a way to pump more money into the system as conditions continue to worsen, leaders of road organizations said Tuesday.

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Sen. Tom Casperson said a road funding solution is needed.

Officials representing the County Road Association of Michigan, the Michigan Infrastructure and Transportation Association and the Michigan Municipal League made their pitch for more road funding to the Senate Transportation Committee. None advocated a specific solution, but noted previous proposals such as exempting fuel from the sales tax - which at today's gasoline prices amounts to an 18 cents per gallon levy - and then raising the gasoline tax by an equivalent amount.

Michael Nystrom, executive vice president of MITA, sought to address the sentiment prevalent in the Legislature not to raise taxes. He said, in general, he agreed with keeping taxes low. But when it comes to roads, "The equivalent of having the lowest gas tax in the nation is the equivalent of having the worst roads in the nation."

And Ed Noyola, deputy director for the County Road Association of Michigan, voiced frustration that a wide spectrum of groups made the case for more money in previous legislative terms only to see no action.

"Here we are again, back in front of a legislative body to plead our case," he said.

Mr. Nystrom ran through a series of disturbing statistics, such as the state having 28,700 miles of state and local roads in poor condition, 38 counties having pulverized paved roads back to dirt or gravel because they could no longer maintain them and having 3,052 structurally deficient and functionally obsolete state and local bridges. Available funding for the state's roads has fallen by hundreds of millions in recent years.

Mr. Nystrom mentioned the idea of exempting gasoline from the sales tax and raising the gasoline tax as a possibility, but also characterized it as "off the wall" idea. He noted though that the 6 percent sales tax raised $718 million from gasoline sales in 2009.

"We have a collision course, a train wreck, that's waiting to happen," Mr. Nystrom said of the situation with road funding.

Sen. Tom Casperson (R-Escanaba), the committee chair, said afterward that he wants to talk with Senate leadership and the administration of Governor Rick Snyder about what to do.

"Clearly, there's a problem," he said. "I can sense frustration, and I can completely understand it."

Still, there's no appetite to raise taxes, Mr. Casperson said, and that creates a jam.

"I don't have the answer," he said. "I just know there's a problem."

Senate Skirmish On E.I.T.C. As Bill Introduced

Seldom has the introduction of a bill generated as much of a furor as Sen. Roger Kahn's submission of legislation Tuesday to repeal the Earned Income Tax Credit, but it only further confirmed the EITC as an early flashpoint in what is expected to be a difficult budget this year.

Mr. Kahn - with six Republican co-sponsors - introduced SB 103[log in to unmask]" alt="*">, which would end the ability of the working poor to claim a state income tax credit equal to 20 percent of the credit they receive on their federal taxes. The bill was referred, as expected, to the Senate Finance Committee.

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Interested in tracking legislative action and Gongwer coverage on a specific bill? Just click on the green block - [log in to unmask]">- next to the bill number and to request an email alerting you to any activity or articles on the legislation. Subscribers will need a username and password for the Gongwer website for this feature.

"The EITC will cost $340 million this year and is estimated to cost $370 million in FY 2012," Mr. Kahn said in remarks on the Senate floor. "$370 million. Let me put that in perspective. All in, the budgets of agriculture, the attorney general, civil rights, education, DELEG, the executive office, judiciary, auditor general, military affairs and the secretary of state would only total $357 million. ... We don't need it and it is certainly not worth the equivalent of the entire budgets of 10 state departments."

Co-sponsoring the bill were Sen. Mike Nofs of Battle Creek, Sen. Phil Pavlov of St. Clair, Sen. Arlan Meekhof of West Olive, Sen. Rick Jones of Grand Ledge, Sen. Jack Brandenburg of Harrison Twp. and Sen. Darwin Booher of Evart.

But Democrats and a variety of organizations denounced the bill.

"My colleague has said that there are over $300 million in savings, but let's be straight with the voters. It represents a tax increase on those who can least afford it if you get rid of the earned income tax policy," said Senate Minority Leader Gretchen Whitmer (D-East Lansing). "Now there are many people in state government who, frankly, I don't think understand what this earned income tax credit is. I have heard comments from people in the Executive Office to people who hold gavels in this body saying that it is a handout for people who are not working. Let's really talk about the facts. This is about helping people who are working and doing the best they can."

The Michigan Catholic Conference called the bill alarming and unfortunate.

"The legislative majority has stated since it took control this legislative session there would not be a tax increase to resolve the budget deficit - yet the first piece of legislation designed to address that shortfall represents nothing but a tax increase on the working poor," said Paul Long, president and CEO of the Catholic Conference. "Michigan's low-income workers should not bear the burden of setting straight the state's fiscal house."

Senate OKs 'I'm Sorry' Bill For Med-Mal Cases

Health care professionals who express sympathy to the family of someone who died or experienced pain and suffering while receiving care could not have those statements used against them in a medical malpractice lawsuit under a bill that unanimously passed the Senate on Tuesday.

Known as the "I'm sorry" law, SB 53[log in to unmask]" alt="*"> is designed to allow health care workers to offer condolences or sympathy to an individual's family without putting them at risk of having such statements used as evidence of admitting liability should they be sued.

Sen. James Marleau (R-Lake Orion), the bill sponsor, recalled in his family he was taught the magic words of "please," "thank you" and "I'm sorry." Allowing health care professionals to offer expressions of sympathy without fear of putting themselves at risk of liability is common sense, he said.

"It's the right thing to do," he said.

Snyder Pops In On House

Governor Rick Snyder made an impromptu appearance on the House floor Tuesday as members were gathered for session.

Mr. Snyder was already in the Capitol for several meetings, according to spokesperson Sara Wurfel, and the timing worked out where he could pop in and briefly chat with legislators.

Ms. Wurfel said the conversations were casual and not specifically related to any one issue. She said the opportunity allowed the governor to continue building his relationships with legislators.

Mr. Snyder made it up and down both the Republican and Democratic sides of the chamber. He also abided by the dress code of the House by wearing a bright green tie.

U-M Study: Local Officials React To Workers Pay, Benefits

Most local officials do not think their workers are overpaid in terms of salary and wages, a study by the Center of Local, State and Urban Policy at the University of Michigan said. But many do think their workers get benefits that are more generous than the general public.

The survey is the latest salvo fired in the current fight over public employee pay and benefits. The study was done of local government officials, and came out about a week after Governor Rick Snyder issued his plain language balance sheet that triggered controversy in saying that public workers are compensated nearly twice as much as the average worker in the private sector.

The survey was completed by officials in more than 1,000 localities in the state. However, the data is almost a year old, since the survey was completed in the spring of 2010.

The officials were asked about pay to their workers and 65 percent of those responding said they thought the pay rates were about right. Some 25 percent said they thought the pay rates were too low. Just 6 percent thought the pay was too high.

Nearly one-third of the localities do not offer fringe benefits to their workers, according to the survey.

Of those that do offer fringe benefits, such as health insurance, 62 percent said they thought the benefits are at the right levels.

But the response was different from officials in the state's largest communities, where 53 percent of the respondents said they thought the benefits paid their workers were too generous. In the smaller communities, just 18 percent of the respondents thought the benefits were too generous.

Report: Obama Will Not Call For Interest On U.I. Debt

President Barack Obama may be preparing to give Michigan businesses a break by not calling on them to pay on interest owed for unemployment payments.

A report in a New York Times blog says that Mr. Obama's budget proposal for the 2011-12 fiscal year will defer collecting taxes for the debt Michigan and many states have on unemployment insurance repayments to the federal government.

That could affect an estimated 54,000 companies in Michigan that have to pay $67.50 per worker this year to help the state pay the interest on the more than $3 billion it has borrowed to make benefit payments to unemployed workers.

Michigan is the first state to have to begin paying on the interest owed on the funds, but eventually 31 states will be required to make payments on that interest. In total the states have borrowed more than $42 billion from the federal government to help make unemployment benefits payments.

Michigan officials have been working with U.S. Sen. Debbie Stabenow (D-Lansing) to win a reprieve on the payment of the interest, which they said will take as much as $50 million out of the state's economic development efforts at a time when more money is needed to help boost the economy.

Officials had hoped an agreement to delay the payments could be reached in December when Congress and Mr. Obama reached an agreement on the personal income tax and on unemployment benefits. It was not to be, however.

The only companies required to pay the interest are those with negative balances, those that have actually laid off workers. That still amounts to some 54,000 businesses. While the interest payment of $67.50 per worker only has to be made once a year, how many have made the payments has not been released.

Mr. Obama's proposal would have to be approved by Congress. While the now Republican-controlled U.S. House may put up some resistance to the idea, a number of Republican governors, including Governor Rick Snyder, have called for the federal government to give the states a break on the unemployment tax interest payments.

Along with Michigan, companies in Indiana and South Carolina also have to pay interest on their unemployment debt.

According to the report, the administration is looking at having payments begin again in 2014, but would also increase the base pay rate from $7,000 a year to $15,000, which theoretically would help the state's pay the debt as well as rebuild their trust funds.

Republicans Press M.E.D.C. For Improvements

More responsiveness to the needs of struggling Michigan businesses and greater transparency were calls Republican lawmakers made to Michigan Economic Development Corporation officials on Tuesday.

With the state struggling economically over the past 10 years, Rep. Jeff Farrington (R-Utica) put it straight to the new CEO Michael Finney by asking what the MEDC is going to do differently than it has in the past four to eight years (when Democrat Governor Jennifer Granholm was in charge).

Testifying before the House Commerce Committee, Mr. Finney said the MEDC does intend to operate at a higher level of transparency and allow stakeholders to engage in what's going on at the MEDC more.

Engaging local economic development partners, as Governor Rick Snyder discussed last month, will also be new. Mr. Finney, the former head of Ann Arbor SPARK, said in his prior role he often felt the MEDC didn't get input from local partners in developing its strategies.

"I really didn't feel connected. Not that they were bad strategies, it (just) would have been nice to understand them upfront)," Mr. Finney said.

Rep. Sharon Tyler (R-Niles) said improving the retention call system is desperately needed. Often a local company participates in the MEDC's retention call as a favor to local economic development groups, but the state doesn't really use that time as an opportunity to learn what a company needs or ask how it could help bring some of its subcontractors to Michigan, she said.

Mr. Finney said he often found multiple state agencies, as well as the locals, are making retention calls to businesses and that's a duplication of efforts. He said the MEDC wants to use the retention calls as an economic gardening tool to understand what assistance companies may need to grow, so those efforts are being refined.

Rep. Mike Shirkey (R-Clark Lake) and Mr. Farrington both called on the MEDC to be more transparent with its economic development figures and use a more effective system of measuring results since it often seems like the focus is simply on retained or new jobs and how much investment the company is making in Michigan.

Mr. Farrington said he encountered a situation where a business seeking assistance from the Michigan Economic Growth Authority was told it could only have state aid if company officials told their employees they were going out of business. That way, the state could swoop in and help and count that as "retained jobs," Mr. Farrington said.

Those kinds of interactions with businesses have discredited the MEDC's reputation, he said.

Board Recommends Teacher Prep, School Funding Changes

The Board of Education on Tuesday recommended that the governor and Legislature adopt policies that would gear the state's education system toward life-long learning, including career-long improvements for teachers, and would change how schools receive aid as well as how much.

Among its recommendations approved unanimously, the board echoed Governor Rick Snyder's call for an education system that ranges from preschool through college, including providing universal preschool for all children and mandating kindergarten.

The board also called for incentives to ensure that schools are helping students progress through the system. Part of that effort is improving teachers through a tiered licensure system to encourage teachers to move up as well as changes to allow easier removal of ineffective teachers.

To ensure the reforms move forward, the board called for equitable funding for all schools. The board recommended ways the state could reduce the cost of education, including combining the more than 80 early childhood initiatives around the state, was well as potentially increasing state funding for districts.

One of the end goals of the proposal would be having 90 percent of students graduate high school ready to enter college or work training without having to take remedial courses.

In addition to it being the start of a new term on the board, members said now was the time to propose the reforms because of the push for change by Mr. Snyder.

"This is a kind of opportunity on a wave of political momentum to make education reform happen," Board President John Austin (D-Ann Arbor) said. "It's a chance for us to accelerate pieces of reform and policy that we've been working on and bring those forward in real time."

While the board did talk about the need for additional, and better use of, funding for schools, it avoided calling for any particular types of new revenue as it did in prior recommendations. Instead, it called for "re-allocating budget priorities within state government" to provide additional funds for schools.

Republican members of the board particularly warned against recommendations that fall outside the board's area of influence.

"I would encourage the board to recommend something that we have purview over," said board Secretary Nancy Danhof (R-East Lansing). "We don't have the authority to determine what kind of revenue we have."

But she and others said the board did have a constitutional responsibility to indicate how much revenue schools need to operate.

"When we start talking about raising taxes, we don't have that right," said board member Eileen Weiser (R-Ann Arbor). "We can talk about funding needed."

The board also called for tying some of that funding to student achievement. In addition to the base foundation grant, the recommendations would have a portion of the grant based on student performance and progress.

And the board called for schools to have even more flexibility in how they spend that foundation grant, as long as that spending is improving student achievement.

For schools that are struggling financially, the board called for review of the financial manager law to clarify the roles of the emergency financial manager and the elected board.

The recommendations focus on improving achievement with particular emphasis on programs for the lowest-performing schools, including highlighting programs that are proven to work. It also calls for ensuring choices for students in those struggling schools.

But it also calls for ensuring access to accelerated programs for those students who qualify, including eliminating financial disincentives to allowing students to participate in dual enrollment programs.

Part of the school improvement effort was also calling for universal preschool programs.

"All of the evidence is that investments in children at that age pay huge dividends down the road," said board member Dan Varner (D-Detroit).

But the board ensured that the recommendation was to have the programs available, not that children be required to attend them.

"There are some families where preschool would be a benefit, and for some families it will not," said board member Richard Zeile (R-Detroit). "We don't want to be institutional enablers of parental neglect." He said some homeschooled children will receive more adult attention than they would in preschool programs.

For teachers, the board recommended a three-tiered licensing system, with concurrent compensation changes, for new teachers, proficient teachers and master teachers.

Board member Marianne McGuire (D-Detroit) raised concerns that the proposal would remove the current incentive most districts provide for teachers earning master's degrees.

The recommendation also would call for a review system that includes student achievement as a measure of teacher quality and that allows easier removal of ineffective teachers.

Districts would also have use of a variety of partners, including private organizations, to implement programs to help teachers improve under the proposals.

"Why not work with our local districts, with our ISDs, with local groups and private investment to do the job we know needs to be done?" Ms. Danhof said in requesting to add the provision.

Vote On Item Pricing Bill Postponed

A vote to repeal the state requirement that nearly every item in a store come with an individual price sticker will wait at least another week as the House Commerce Committee postponed action on HB 4158[log in to unmask]" alt="*"> during its meeting Tuesday.

Chair Rep. Wayne Schmidt (R-Traverse City) said the Department of Attorney General was still working on some consumer protection amendments for the bill and "hopefully" the committee can vote on the legislation next week.

Gongwer News Service previously reported how the legislation removes any authority the Department of Agriculture has with the remaining item-pricing law and gives sole responsibility to the attorney general.

Meanwhile, Marketing Resource Group released a poll showing Michigan residents are split on their opinion of the legislation: 45 percent support repeal of the individual sticker mandate and another 45 percent oppose the repeal.

Of the group who supports repeal, 28 percent strongly support it and 17 percent somewhat support it. Of the group who opposes repeal, 31 percent strongly oppose it and 14 percent somewhat oppose it. Another 10 percent of respondents were undecided.

The legislation still keeps penalties in place for retailers who overcharge customers.

The MRG poll of 600 likely voters was taken January 24-27 and has a margin of error of plus or minus 4 percentage points. The arguments for and against the bill were rotated between calls. MRG noted a poll it conducted on the topic in 1992 showed 50 percent opposing item pricing repeal and 43 percent supporting repeal.

Steudle: M.D.O.T. Reorganizing Itself

With a total vacancy of nearly 20 percent of its workforce, the Department of Transportation is in the process of developing a reorganization plan, the department director told the House Appropriations Transportation Subcommittee on Tuesday.

Kirk Steudle also warned the subcommittee that rule changes enacted by the U.S. House could mean the state would lose as much as $190 million in federal transportation funding.

The presentation before the subcommittee was designed to help the legislators get familiar with an administrative overview of the department. The chair, Rep. David Agema (R-Grandville), said there would be no questions on the controversial Detroit River International Crossing proposal.

While going through the various elements of funding, organizational structure and required planning processes (as well as the department's increasing use of social media to help inform motorists of construction updates), Mr. Steudle said that with the recent state worker retirements, the department was about 20 percent down from its authorized level of personnel.

While the department is authorized to have 3,000 workers, it has not had that many in years, Mr. Steudle said. The department was holding 244 vacancies before the latest early retirement plan went into effect.

Another 328 workers, representing more than 12,000 years of experience, left the state by January 1, Mr. Steudle said.

That means the department has roughly 20 percent fewer workers than it is authorized, he said.

The department is now in the process of developing a reorganization plan that Mr. Steudle said should be completed before the start of the 2011-12 fiscal year.

But he said any changes the department implements will not affect the department's customer service mission.

Because the largest share of the department's budget comes from federal funds, Mr. Steudle said the new rules adopted by the U.S. House could cut the state's funds significantly. The rules are aimed largely at granting less authority on funding to trust funds. Other transportation related organizations warned the rules could hurt state funding by making it less likely all the states could get funds for planning and future work.

Mr. Steudle said he was also concerned about talk in Congress on doing away with the federal highway trust fund altogether which means Michigan and all the states would have to fight for federal funding out of the U.S. general fund.

Binding Arbitration Repeal Introduced In House

Local governments have long sought for a repeal, or at least changes, to the state's binding arbitration law commonly referred to as PA 312 and on Tuesday a House Republican introduced such a measure.

Rep. Joseph Haveman (R-Holland) is sponsoring HB 4205[log in to unmask]" alt="*"> and HB 4206[log in to unmask]" alt="*">, which repeal binding arbitration.

"At a time of fiscal crisis in our state with many communities close to receivership, we must find ways to free the hands of local elected officials from outdated and costly statutes and regulation such as this," Mr. Haveman said. "Binding arbitration results in incremental increases to benefits and pay that are leading many of our municipalities toward bankruptcy. It is just not appropriate to continue using a system that damages a city's finances and compounds the tax burden on residents."

The bills were referred to the Government Operations Committee, which is chaired by House Majority Floor Leader Jim Stamas (R-Midland).

Homebuilders Expect Business Bump

Homebuilders in the state began to see business come back at the end of last year, and are expecting double-digit growth for 2011, the Michigan Association of Home Builders said in a report Tuesday.

The group is predicting 16.5 percent growth in building permits for 2011, and saw a 17.8 percent increase in the Michigan Housing Index, the association's measure of housing activity in the state.

The remodeling index, however, was down in December to 34 from 38 in November.

The December housing index returned to about the May 2010 level, which had been boosted by federal tax credits for new construction that expired mid-year.

The group also noted that, while 2011 is projected to see increases, that is still from a 2010 year that was 72 percent below the 30-year average for single-family home permits. And the first half of 2011 is still expected to be below the first half of 2010.

P.S.C. Rejects Renewable Credit Double Counting Charge

Harvest Wind Farm sold only one renewable power credit for each unit of power it generated, the Public Service Commission reported Tuesday.

The Ecology Center had alleged the wind energy facility had sold the same renewable power to Wolverine Power Cooperative and to Detroit Edison.

But PSC officials said the Ecology Center had mixed renewable power from others sources in reviewing Wolverine's available credits, leading it to incorrectly calculate the credits available from Harvest.

P.S.C. Investigating Mackinac Island Ferry Service

The battles between the companies providing ferry service to Mackinac Island and the city have now moved to the state level, with the Public Service Commission opening an investigation into the situation.

The city of Mackinac Island has been trying to develop a solution that would cut ferry rates to the island and increase service during off-season months, but so far that attempt has resulted in allegations of the city attempting to create a monopoly and various legal and public relations wrangling.

The commission entered the discussions last week with a filing February 4 by Shepler's Incorporated (case No. T-1862). The commission has set a hearing for February 22 for the ferry companies to begin scheduling hearings on the issue. In addition to the usual contested case hearings, the commission will be scheduling hearings in the area, potentially one each in St. Ignace, Mackinaw City and Mackinac Island, to gather public input on the issue.

L.I.H.E.A.P. HEARING: The commission has also scheduled a hearing for March 10 at 10 a.m. at the commission offices, Suite 7, 6545 Mercantile Way, Lansing, on the reduction in federal funds to the Low-Income Home Energy Assistance Program.

State law requires the hearing whenever the funds are reduced, and the commission will compile the comments at the hearing for a report to the governor and the Legislature.

Comments can also be sent to [log in to unmask] or on the commission's edockets website (case No. U-16541)

DTE Companies Allowed Optimization Charges

DTE's two utilities were able to achieve the savings they projected under their energy optimization plans, so customers of the two utilities will see additional charges to recover the costs of those savings, the Public Service Commission ordered Tuesday.

Michigan Consolidated Gas Company was able to reduce energy use by 0.14 percent in 2007 through its plan, so the commission approved increasing its energy optimization surcharge to cover the $913,374 cost of the program (case No. U-16289). The increase will cost the average residential customer about 8 cents per month beginning in March.

Detroit Edison customers will pay about 5 cents more per month because the utility saw 0.42 percent savings under its plan (case No. U-16358). The power use reduction cost the utility about $3 million.

P.S.C. Delays Consumers Increase

The Public Service Commission for the first time used its power to delay utility increases to head off a proposed $29.5 million increase by Consumers Energy.

The commission, on a 2-1 vote Tuesday, found it had good cause to prevent Consumers from implementing the proposed natural gas rate increase on Thursday.

Commissioner Monica Martinez dissented from the commission vote (case No. U-16418).

Consumers had initially requested a $55.3 million annual increase and had filed testimony to support a $48 million increase.

Committee Roundup

DETROIT PENSION BOARD: The method of selecting a member to the Detroit Police and Firefighters Retirement System Board would be prohibited from the collective bargaining process under HB 4135[log in to unmask]" alt="*"> reported Tuesday by the House Oversight, Ethics and Reform Committee.

The issue is currently in arbitration and lawmakers were asked to hold off on voting by those opposed to the legislation, but it was reported on a 5-1 vote with Rep. Lisa Brown (D-West Bloomfield) the sole dissenting vote. Governor Jennifer Granholm vetoed similar legislation late last year.

SYNTHETIC DRUGS BILL: A bill to again criminalize synthetic marijuana (SB 99[log in to unmask]" alt="*">) cleared the Senate Judiciary Committee on Tuesday. Those substances were inadvertently legalized through the adoption of a new act late last year.

Capital Notebook

TOWNSHIPS ASSOCITION EXECUTIVE COMMITTEE: The Michigan Townships Association announced its executive committee for 2011. Serving on the committee are Jack Randolph, supervisor of East China Charter Township (St. Clair Co.) who will be president of the association's board of directors; Bill Renn, Chandler Township (Huron Co.) supervisor; Denny Olson, Breitung Charter Township (Dickinson Co.) supervisor; Eugene Jorissen, Pere Marquette Charter Township (Mason Co.) supervisor; Linda Preston, Pokagon Township (Cass Co.) supervisor; Doug Merchant, Arcada Township (Gratiot Co.) supervisor; and Linda Towsley, Windsor Charter Township (Eaton Co.) clerk.

POLL SUGGESTS VOTERS WANT MEDICAID PROTECTED: A new survey shows state voters favor keeping Medicaid funding at current levels as opposed to cutting it. The survey, conducted by EPIC/MRA and commissioned by the Michigan Health and Hospital Association, showed 61 percent of voters want Medicaid funding kept intact while just 18 percent agreed "that the level the state pays for Medicaid reimbursement to health care providers should not be any different from any other state program or service that is being cut."

Appointment By The Speaker

Bruce Rasher of Marshall is appointed to the Great Lakes Commission by House Speaker Jase Bolger (R-Marshall).

Supplemental Notice Of Legislative Committees

Wednesday, February 9

Senate Reforms, Restructuring and Reinventing, (Chr. Jansen, 373-5314), Rooms 402/403, Capitol Building, 8:30 a.m.

  • Presentation by Ken Braun, budget policy analyst for the Mackinac Center, to give an overview of recommendations for reforms and structural changes needed to grow Michigan's economy

House Banking and Financial Services, (Chr. Knollenberg, 373-7256), Room 326, House Office Building, 9 a.m., Webcast

  • Presentations by Jeff Weisserman from Trott and Trott and John Llewellyn from the Michigan Bankers Association

HR 21[log in to unmask]" alt="*">

WALL STREET REFORM (Knollenberg) Memorializes Congress to take steps to insure that the Wall Street Reform and Consumer Protection Act does not result in increased fees on consumers at exempted institutions. Full Text

House Commerce, House Tax Policy, (Chr. Schmidt, W., 373-7256, Chr. Gilbert, 373-2013), Room 352, House Appropriations Room, Capitol, 10:30 a.m., Webcast

  • Overview of MBT and MBT surcharge and MBT credits Presentation by Treasury and Presentation by Anderson Economic Group on effectiveness of credits
  • Presentation by the Department of Treasury and Anderson Economic Group on the Michigan Business Tax and MBT credits.

House Transportation, (Chr. Opsommer, 373-1260), Room 307, House Office Building, 12 p.m., Webcast

  • Presentation by Kirk Steudle, Director of the Michigan Department of Transportation

HB 4004[log in to unmask]" alt="*">

RAILROADS (Kurtz) Exempts certain segment of property formerly used for railway from divestiture provision. Full Text

 

HB 4129[log in to unmask]" alt="*">

HIGHWAY RENAME (Knollenberg) Designates a portion of M-24 as the William Davidson memorial highway. (Testimony only) Full Text

Senate Finance, (Chr. Brandenburg, 373-5307), Room 210, Farnum Building, 12:30 p.m., Webcast

SB 1[log in to unmask]" alt="*">

M.B.T. REPEAL (Hildenbrand) Repeals Michigan Business Tax. Full Text

 

SB 34[log in to unmask]" alt="*">

PERSONAL PROPERTY (Nofs) Repeals personal property tax. Full Text

House Appropriations (Human Services Subcommittee), House Families and Children's Services, (Chr. Agema, 373-8080, Chr. Kurtz, 373-5795), Room 352, House Appropriations Room, Capitol, 3 p.m. or after session, Webcast

  • Presentation by Department of Human Services Children's Services Administration

Senate Education, Senate Local Government and Elections, (Chr. Pavlov, 373-5344, Chr. Robertson, 373-5323), Senate Hearing Room, Boji Tower, 3 p.m.

  • Discussion of 1990 Public Act 72

Thursday, February 10

Senate Agriculture, (Chr. Hune, 373-5344), Room 110, Farnum Building, 8:30 a.m.

  • Pending introduction and referral, bills on the Michigan Agriculture Environmental Assurance Program

Senate Natural Resources, Environment and Great Lakes, (Chr. Casperson, 373-5323), Room 210, Farnum Building, 8:30 a.m.

  • Department of Environmental Quality overview by Director Dan Wyant
  • Testimony from Peter Glaser, an attorney specializing in energy and environmental law in Washington

SR 10[log in to unmask]" alt="*">

FEDERAL REGULATIONS (Casperson) Urges the Congress to place a moratorium on any greenhouse gas regulations issued by the Environmental Protection Agency Full Text

 

SCR 6[log in to unmask]" alt="*">

FEDERAL REGULATIONS (Green) Urges the Congress to place a moratorium on any new greenhouse gas regulations issued by the Environmental Protection Agency. Full Text

House Health Policy, (Chr. Haines, 373-7256), Room 519, House Office Building, 9 a.m., Webcast

  • Presentations by: David Finkbeiner, Michigan Health & Hospital Association and Meghan Swain, Michigan Association of Local Public Health

House Judiciary, (Chr. Walsh, 373-5795), Room 521, House Office Building, 10:30 a.m., Webcast

  • Presentations by The State Court Administrative Office on the Michigan Court System and Keith Barber, Legislative Corrections Ombudsman

Senate Appropriations (Human Services Subcommittee), (Chr. Caswell, 373-2768), Senate Hearing Room, Ground Floor, Boji Tower, 12 p.m.

  • Presentation by the Department of Human Services and discussion of the juvenile justice system

Senate Outdoor Recreation and Tourism, (Chr. Hansen, 373-5323), Room 210, Farnum Building, 12:30 p.m.

  • Organizational meeting
  • Presentation by the Department of Natural Resources on the Park Pass Program.

The following was added to the agenda:

SB 110[log in to unmask]" alt="*">

PURE MICHIGAN FUNDING (Hansen) Provides for distribution of 21st Century Jobs Fund money into funding the "Pure Michigan" tourism campaign. Full Text

Remaining previous agenda:

SR 6[log in to unmask]" alt="*">

FIREARM HUNTING (Hansen) Expresses opposition to the ban on firearm hunting and snowmobiling in certain areas of the Huron-Manistee National Forest. Full Text

Senate Banking and Financial Institutions, (Chr. Booher, 373-5314), Room 100, Farnum Building, 1:30 p.m., Webcast

  • Presentations by Michigan Bankers Association and the Michigan Credit Union League on the current conditions of banking in Michigan, as well as the effects of federal regulations on financial institutions around the state

[log in to unmask]">

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