June 23, 2023 | This Week in Government: Clean Energy Bills See Heated Discussion in House Panel

Three bills surrounding clean energy, including one which would move Michigan toward a 100% carbon-free energy portfolio by 2035, were the subject of testimony before the House Energy, Communications, and Technology Committee on Wednesday.

Introduced last week during a press conference led by Rep. Betsy Coffia (D-Traverse City), Rep. Laurie Pohutsky (D-Livonia), and Rep. Abraham Aiyash (D-Hamtramck), the package would aim to make clean energy policy in Michigan among the most ambitious in the nation (See Gongwer Michigan Report, June 14, 2023).

Coffia said HB 4759 would codify the MI Healthy Climate Plan crafted by the Department of Environment, Great Lakes and Energy. Aiyash’s HB 4761 would ensure that utilities are creating more robust energy-waste reduction programs while keeping low-income people in mind. Pohutsky’s HB 4760 would empower the Michigan Public Service Commission to think about climate change and environmental justice when regulating utilities, as well as require them to hold public hearings over certain topics.

Pohutsky said the plan was not to report the legislation but rather continue working with committee members and stakeholders to modify the bills in a transparent fashion.

Rep. Pat Outman (R-Six Lakes) asked about the economic feasibility of transitioning toward 100% renewable energy by 2035. Pohutsky reiterated the bill was a codification of the plan put forward by EGLE and said Outman may want to ask the EGLE officials before Outman cut her off, saying he’s read the plan and that the plan was “a lot of nonsense.”

Pohutsky started telling Outman he’d be better to ask EGLE about the plan before Outman interrupted her again.

“You want to come in here and pitch the most radical and ridiculous energy policy plan in the entire nation and not provide the committee with any comprehensive analysis and study on this?” Outman asked.

Outman, later in the committee meeting, apologized to Pohutsky for “being for a little aggressive in my line of question” and said he is “very passionate about energy policy.”

Rep. Joseph Aragona (D-Clinton Township) asked if nuclear energy was being considered a part of the renewable energy portfolio. Pohutsky said there was a pathway that was being considered with nuclear and a pathway being considered without nuclear, but emphasized that it was not off the table.

Aragona and Rep. Jaime Greene (R-Richmond) expressed concern over not including biomass in the renewable energy portfolio. Pohutsky said the bill’s goal is to move away from carbon-producing methods and said there are ongoing conversations with people in waste management around the use of biomass.

Rep. David Prestin (R-Cedar River) said in his line of questioning that “reckless energy policy” would increase costs and that the distribution grid is not responding to renewable energy like it should. He said the bills are trying to codify “fairies and pixie dust” to be used in energy generation, which he said will kill people who can’t afford a backup generator in power outages.

Pohutsky responded, saying she agreed that people would die if nothing is done to fight climate change. Prestin responded, saying that climate change is theory, not fact.

“As a scientist, I strongly disagree,” Pohutsky responded.

“As a Yooper, I strongly disagree,” Prestin said.

In discussion over whether the goal of 100% carbon-free emissions is possible by 2035, Pohutsky said she understands the perception of it being ambitious, but many utilities said have updated plans that reflect a similar idea, that the bills just ask them to “accelerate that a little bit.”

Pohutsky and Coffia both said they did not wish to move on the bill but rather use the committee as a working group, emphasizing their size and scope. Both Rep. Kathy Schmaltz (R-Jackson) and Rep. Pauline Wendzel (R-Watervliet) raised concerns over the fact that the bills were still in the early stages. Schmaltz said she thinks more things should be in place before bills are introduced.

Wendzel, the minority vice chair of the committee, defended the negative reaction of having legislation brought forward in an early stage. She said other legislation put forward has been moving very fast.

“This is the first time in, I’d say, six months, that legislation has been brought to us with the chance for people to actually talk about it, like legislation is supposed to,” Wendzel said. “When we see legislation brought before our committee, we are alarmed that it is going to pass quickly just like we did yesterday with education, and just like it has been for the past six months. So, forgive us for being a little defensive.”

Also testifying before the committee was Mike Alaimo, the Michigan Chamber of Commerce’s director of environmental and energy affairs, who said the Chamber intends to be at the table, collaborating with the lawmakers and other stakeholders to further craft the legislation. He emphasized that the goals to decarbonize are good but encouraged clear regulatory pathways for businesses to reach that goal.

Also testifying in support was Justin Carpenter, the director of policy for the Michigan Energy Innovation Council. He said the bills’ expansion of renewable energy would help bring economic activity to the state.

Mike Johnston, vice president for governmental affairs with the Michigan Manufacturers Association, said his group opposes the legislation because it could hurt producers of rubber, steel, cement, and other chemical products or durable groups. He said manufacturers could be forced out of business or out of state because they would have to compete with the prices of goods coming from around the nation and world.

CPACE, ENERGY ASSISTANCE CLEAR COMMITTEE: SB 288, which would remove a sunset clause from the Energy Assistance Program, was reported by the committee. Democrats were joined by Wendzel and Rep. Brian BeGole (R-Perry) in voting yes. Outman was the single no vote, and all other Republicans abstained.

Two other bills, SB 302 and SB 303, were reported on a party-line vote. The bills would expand the use of CPACE, a pre-existing program that provides aid to those who wish to make certain types of properties more energy efficient.

Both bills heard testimony last week.

The chair of the Senate Elections and Ethics Committee said the main work in getting Proposal 2 implementation bills is completed, and the next items on his agenda will include financial disclosure as well as changes to campaign finance law and the Freedom of Information Act.

Two bills, SB 386 and SB 387, dealing with the processing of absentee ballots prior to election day, were reported by the committee Tuesday. Movement on those bills followed movement on an eight-bill Proposal 2 implementation package that passed the full Senate last week with some bipartisan support (See Gongwer Michigan Report, June 14, 2023).

“I think we’ve completed our tasks regarding that ballot proposal,” Sen. Jeremy Moss (D-Southfield) told reporters following votes to report SB 386 and SB 387. “Today was not necessarily directed from Prop 2, but we know that early counting of absentee ballots just like 38 other states do is a central piece to reducing the chaos that we’ve seen in our past elections and allowing clerks to have a more smooth process rolling forward.”

Moss told reporters one of his next priorities will be working to implement Proposal 1, which will require personal finance disclosures be made by all elected state officials. The proposal also changed term limits to a 12-year maximum.

The senator said his priorities include implementation of Proposal 1, changes to campaign finance law, and updating the Freedom of Information Act, the latter of which is something he and Sen. Ed McBroom (R-Vulcan) have been working together on since their days in the House.

He said for Proposal 1, he has been working with Sen. Sam Singh (D-East Lansing), chair of the Senate Oversight Committee, as to how to approach that legislation and which committee through which the bills might be moved.

“We’re working with our House counterparts as well, as we need to come up with a package by the end of this year,” Moss said.

Prior to reporting SB 387, an S-1 substitute was adopted 7-0 that included provisions to ban the recording of photo, audio, or video at absentee ballot counting board locations with some exceptions, including for members of the media.

As reported, the bills would allow communities with a population of at least 5,000 to set up absentee counting boards to process absentee ballots between 7 a.m. and 8 p.m. on any of the eight days before election day. All other communities would be able to begin processing absentee ballots at 7 a.m. the Monday morning before an election day.

Sheree Ritchie with Pure Integrity for Michigan Elections spoke in opposition to the bills prior to the votes, saying SB 387 has several provisions the group does not support.

“There are numerous changes to the absentee voter ballot processing, and there doesn’t seem to be a clear motivation for this other than to further harm election integrity in Michigan,” Ritchie said.

Members voted 7-0 to report SB 386, which would amend statute dealing with penalties related to the early disclosure of election results.

For SB 387, the vote was 5-1, with Sen. Ruth Johnson (R-Groveland Township) voting no and McBroom abstaining.

Also reported 7-0 was SB 385, which would allow county, city, and township clerks to provide the option for individuals seeking to apply to be election inspectors to do so by filing electronically.

Divided testimony marked a Wednesday hearing before a Senate panel on legislation that would undo two Gov. Snyder-era policies, one dealing with local control of wages and benefits with the other addressing organized labor agreements in bids for construction projects.

Before the Senate Labor Committee for testimony were SB 170 and SB 171.

The first bill would repeal PA 98 of 2011, which enacted restrictions on project labor agreements, which are a type of collective bargaining agreement. The latter bill would repeal the Local Government Labor Regulatory Limitation Act, or PA 105 of 2015. The existing law bans local governments from setting requirements for minimum wage higher than that of the state minimum wage or other fringe benefits.

Supporters of the bills told committee members the proposals would provide municipalities with the ability to enact policies they believe would work for them. Opponents said repealing the Snyder-era proposals would create additional hurdles for businesses.

Both bills before the Senate panel are similar to House legislation heard last Thursday before the House Labor Committee (See Gongwer Michigan Report, June 15, 2023).

Those in favor said SB 170 would provide cost savings to local governments through efficient construction work through quality contractors while drawing strong wages.

“This legislation will address existing laws that currently and significantly restrict local control when it comes to decision-making on construction projects,” said Sen. Sean McCann (D-Kalamazoo), the bill sponsor.

Those opposed to SB 170 attacked the proposal by boxing non-union contractors out of local construction projects in a discriminatory fashion while pushing work over to union companies. They also said it would lead to soaring project costs at taxpayer expense.

Sen. Thomas Albert (R-Lowell) said many studies have shown that PLAs lead to increased project costs. He pointed to examples in the state of Connecticut and the city of Los Angeles of PLAs leading to cost increases of 10-20%.

“Why should Michigan adopt policies that raise the cost to taxpayers when the work can be done by qualified construction workers at a more reasonable cost,” Albert said.

McCann replied that local communities should be able to have their own choice rather than a blanket statewide ban. He added he would expect there to also be studies that have been published that refute statistics that Albert was citing.

Kent County Commissioner Stephen Wooden called SB 170 a proposal critical to strengthening local communities.

“For years, our state … failed to give municipalities the resources they need to deliver the quality of life their constituents deserve, or worse, taking abilities away from municipalities, the resources to enact local policies to address needs,” Wooden said.

Albert pressed Wooden on what would happen if a community were to enact policies that bankrupt the municipality and put the state on the hook for a bailout.

Wooden said he was not going to speculate on “an extreme hypothetical,” to which Albert countered that it was not extreme by referencing the expensive Detroit bankruptcy.

For SB 171, its backers said such moves would provide people with livable wages.

“This law in its current form has stifled both community’s ability to attract talented workers into their area,” said McCann, who also sponsored SB 171. “My bill will restore local control to local government units and communities to increase minimum wage, living wage, prevailing wage, unpaid leave, and other laws that they determine may be beneficial to their community.”

Concerns over this bill raised by opponents included that it could create a difficult patchwork of regulations for businesses to navigate and induce employers to leave larger cities if local leaders pass minimum wage or fringe benefit requirements beyond their capabilities to cover.

National Federal of Independent Business Michigan State Director Amanda Fisher spoke in opposition to SB 171.

“This is one of those items that I think it does make sense to have it at the state level, especially for both businesses big and small with multiple locations,” Fisher said.

She then referenced a study of increasing the minimum wage in Minneapolis and St. Paul, Minnesota, where the Federal Reserve Bank of Minneapolis found a less than 1% wage increase and nearly 2% in job losses.

“One of the reasons they said the wage hikes really didn’t make a difference was because the market was already forcing employers to pay as much as they could,” Fisher said.

David Worthams with the Michigan Manufacturers Association was also opposed to SB 171.

“We believe, especially for a small manufacturer located in multiple locations throughout the state, that it is critical for the Legislature to preempt action so there is consistency in managing facilities and ensure that our members can stay competitive here, nationally and internationally,” Worthams said.

Albert, in response to testimony supporting SB 171, took exception with what he considered to be an attempt at central planning, something he said historically has not worked by pointing to authoritarian countries over the last century.

“Central planning does not work,” Albert said. “Central planning leads to a loss of freedom, it leads to a loss of opportunity.”

Albert said that if larger cities in the state begin putting higher requirements in place for minimum wage and fringe benefits beyond what employers can absorb, it will drive businesses away along with the corresponding jobs.

Committee Chair Sen. John Cherry (D-Flint) told Gongwer News Service that following the hearing, he was unsure if the bill would be reported before the Legislature’s summer recess.

Three petitioners whose companies were contracted by several candidates dinged for fraudulent signatures on 2022 nominating petitions now face nearly 80 felony counts for various crimes, including defrauding disqualified gubernatorial candidates.

Attorney General Dana Nessel on Thursday announced charges against Shawn Wilmoth, Jaime Wilmoth-Goodin, and Willie Reed, each charged with everything from false pretenses, using a computer to commit a crime, election law fraud, and conducting a criminal enterprise.

Wilmoth and Reed will also each face one count of larceny by conversion and another count of using a computer to commit a crime. Wilmoth will also be charged as a habitual offender.

Companies owned by these individuals involved in defrauding Michigan candidates were First Choice LLC, Mack Douglas LLC, and Petitions Reed LLC.

The attorney general went on to say that both Wilmoth and Wilmoth-Goodin have been taken into custody, but Reed was still a wanted man and was being sought by the U.S. Marshals Service. Reed is not currently in the state, Nessel said but said he knows he’s a wanted man now with all of the publicity on the case.

James Craig, Perry Johnson, Donna Brandenburg, Michael Brown, Ryan Kelley, and Michael Markey were among gubernatorial candidates affected by the fraud that Nessel in a news conference called “sophomoric and transparent.”

“The signatures delivered to these campaigns were obvious forgeries. The methods these defendants used to disguise their fraud were sophomoric and transparent and easily detected,” said Nessel. “But the crimes committed were serious criminal offenses that destroyed their clients campaign prospects and aimed to defraud the Bureau of Elections, all in service of a scheme to con these campaigns out of hundreds of thousands of dollars.”

To be more specific, the department said in a follow up news release that the three defendants allegedly charged the nine affected campaigns over $700,000 for valid signature collection, then knowingly delivered fraudulent signatures to eight of the nine campaigns.

Nessel said during the news conference announcing charges Thursday that just seven of them were disqualified, while Brown withdrew around the same time the fraudulent signatures were discovered.

In the case of Kelley, the attorney general said that he got nothing for his money paid to the three individuals – zero signatures, Nessel added. Both Wilmoth and Reed are being charged with theft from Kelley’s failed gubernatorial campaign.

The investigation began in June 2022, Nessel added.

Nessel said the alleged forgeries were quickly detected by the Bureau of Elections, housed within the Department of State, which then determined seven candidates – Johnson, Craig, Brandenburg, Brown, Markey, and judicial candidates Tricia Dare and John Michael Malone – had not met the qualifications to appear on the 2022 primary ballot.

The Department of State then referred the matter to the Department of Attorney General for investigation.

“This expansive fraud also stole something from the voters of Michigan,” said. “When seven of these candidates were disqualified from the ballot, fully half the Republican field for governor was deemed ineligible for voters to consider. Our democracy suffers when the voters are denied the opportunity to evaluate candidates they may have wished to support on election day.”

Nessel said this situation should be cautionary tale for would-be candidates in future elections to take the necessary time and effort for diligent vetting of any firm used for signature collection.

“I very much believe had the victims in these cases or their campaigns properly vetted these vendors, they likely never would have hired these defendants or their firms in the first place,” she said. “So, know who you were trusting with your money, your reputation, and with your political future. I further believe that Michigan should view this as a cautionary tale as to why we need better and stronger laws on the books as it pertains to signature collection for candidates and for ballot proposals.”

The attorney general said that other states require signature gatherers to be registered voters in that state, while others preclude people with previous convictions from acting as a canvasser and most certainly if they’ve been convicted of fraud, forgery, or election law violations.

“We might also want to consider requiring canvassers to be registered with the state or for that signature collection firm to be licensed and bonded. There are things that we can do,” Nessel said.

Asked if the fraud was deliberate, as in seeking to take these candidates for a ride, or if the fraud was the result of just generally shoddy work or time constraints, Nessel said that her office believes the defendants “absolutely knew” that they were submitting forgeries.

“We believe that they should have known when they took these clients on in the first place that what they were vowing to do, what they had contracted for, was a virtual impossibility. In the 2022 election, you might have a person who’s gathering signatures for ballot proposals carry five different proposals, and they can do that, and they can have one person sign all 3,4,5, or 6 of those, and there’s nothing illegal about that,” Nessel said. “However, when you’re talking about a candidate for governor or any other office, that one person can only pick one, they can only sign one of them. These firms had to know that when they were taking these clients on and … what we believe happened is that this was just irresistible to people who wanted to commit fraud.”

The attorney general noted that she has had conversations about proposals like registering canvassers with Secretary of State Jocelyn Benson, Sen. Jeremy Moss (D-Southfield), who chairs the Senate Elections and Ethics Committee, as well as Rep. Penelope Tsernoglou (D-East Lansing) and Rep. Erin Byrnes (D-Dearborn), who chair the House Elections Committee and the House Ethics and Oversight Committee, respectively.

Tsernoglou attended Thursday’s news conference. Moss on Twitter wrote that he joins Nessel’s call to “clamp down on petition fraud.”

“A person should be able to grow support for their campaign based on its own merit. But too many bad actors use lies as the only method to collect the signatures to start the campaign,” Moss wrote. or years, I’ve led on legislation to ensure integrity of petitions, including: Holding campaigns accountable for petitioners who knowingly lie; forbidding those convicted of election crimes from collecting petitions; (and) requiring registration of petition circulating orgs.”

Johnson on Twitter also commented on the situation, saying that it was “highly likely that either (Craig) or myself would be governor today if it weren’t for the crimes these (firms) allegedly committed.”

Johnson, who is now running a long-shot campaign for the 2024 Republican presidential nomination, added that he was “thrilled to see they are being held accountable, and I thank the professionalism of the AG’s office.”

Craig told Crain’s Detroit Business and The Detroit News on Thursday that he was appreciative of Nessel’s crackdown on the three petitioners that all but sank his gubernatorial campaign.

While he was the frontrunner for much of the race, Craig did face steep competition due to the sheer number of candidates in the primary, which amounted to half of the original 10 who were running.

It’s also unclear if Craig or Johnson would have been the ones to break through, as a nod from former President Donald Trump all but sealed the deal for gubernatorial candidate Tudor Dixon to win the nomination. Dixon’s camp had been courting Trump’s endorsement at the highest levels of his inner circle in the weeks and days leading up to the primary contest, and it’s unclear if he would have swung for the likes of Craig or Johnson.

Johnson did appear at Trump’s Mar-a-Lago Club post-presidency stronghold in Florida, where he joined the former president on stage.

Wilmoth, owner/operator of First Choice LLC and co-owner of Mack Douglas LLC, and Reed, owner/operator of Petitions Reed LLC and co-owner of Mack Douglas LLC, each face:

• one count of conducting a criminal enterprise, a 20-year felony;
• eight counts of election law forgery, a five-year felony;
• three counts of false pretenses, $100,000 or more, a 20-year felony;
• two counts of false pretenses, $50,000 or more, a 15-year felony;
• three counts of false pretenses, $20,000 or more, a 15-year felony;
• eight counts of using a computer to commit a crime, $20,000 or more, a 10-year felony;
• one count of using a computer to commit a crime, $1,000 or more, a 5-year felony; and
• one count of larceny by conversion, $1,000 or more, a 5-year felony.

Wilmoth-Goodin faces the same charges except the additional single count of using a computer to commit a crime and the count of larceny, which stems from theft mentioned by Nessel against Kelley’s campaign.

Public school retirees could return to work at a school without endangering their pensions and retirement health care benefits if certain conditions are met under new legislation.

The House Education Committee heard testimony on HB 4752 on Thursday. The bill would allow a retiree to be employed at a school and continue to receive their retirement allowance and subsidy for health care benefits as long as they retired after a bona fide termination of employment and earn less than $10,000 in a calendar year.

“You can come back if you’re a substitute teacher or a coach. Maybe you’re a special ed consultant that wants to help write IEPs. Maybe you are a club advisor. Maybe you want to be a part-time bus driver. There’s a lot of things you can do,” said Rep. Matt Koleszar (D-Plymouth), who sponsors the bill.

Currently, people who retire from the public school system are required to sit out of the system for nine months before they can go back to working in public schools if they are to remain eligible for their retirement benefits.

In 2010, the law preventing educators from returning to work at schools without a cooling-off period was enacted to prevent “double-dipping,” Koleszar said. The nine-month period was established to prevent people from retiring from mid-school year and returning at the start of the next year.

“Maybe a high-level administrator, who is making a good, six-figure income would, quote, unquote, retire, one day, and then come back the very next day and collect a pension and still make that six-figure income,” he said.

Koleszar said that he didn’t know how often that scenario might come up, but recently retired teachers often made the best substitutes.

Rep. Jaime Greene (R-Richmond) said she supported the bill but asked if the $10,000 cap was necessary.

Koleszar said that the $10,000 threshold was set by the IRS to not risk the retirees’ pension but that if he could get assurances that the dollar amount could be higher, he’d be open to changing it.

Allowing retirees to return to work at schools could help cut down on shortages across the school system, supporters said.

“The challenge that we face to fill positions is, unfortunately, getting worse, and it’s through a variety of positions in our school systems,” said Eric Edoff, superintendent of L’Anse Creuse Public Schools.

Still, Edoff said the bill was a temporary solution to the problem.

“But I believe it’s necessary in the times now so that we can staff our classrooms with the best professionals, the most highly professionals,” he said. “Our kids deserve that.”

Mike DeVault of the Macomb Intermediate School District said having retirees in classrooms was the best way to guarantee quality substitutes and support both staff and students.

Anthony Estell, Director of the Office of Retirement Services within the Department of Technology Management Budget, raised concerns about the qualifications of bonafide termination, which could interfere with the tax preferred status of the retirement plan. He also raised concerns about funding where people may negotiate different salaries or benefit packages.

Estell said the actuary always expects a percentage of people to retire as soon as they’re eligible.

“That’s built into the modeling. If we start to see a shift because we have more permissive rules so that people are starting to retire early, that will impact on the liabilities to the system,” he said. “And then that just becomes a cost that is carried by all the employers going forward if that were to happen. Is that deterring us from doing what’s best for skills in schools right now? I would need to defer to the legislature on that.”

The balance of benefits and unfunded liabilities would have to be assessed by the legislature.

“The only obstacle that I’m hearing…is just financial,” Rep. Jaime Churches (D-Wyandotte) said. “This money and lack of investment is the only think keeping us from bringing seasoned teachers back into classrooms.”