Sept. 6, 2024 | This Week in Government: Groups Push to Preserve Tipped Wage; Singh Hopeful For Deal

Stakeholders urging the Legislature to amend laws set to take effect in February that would increase the minimum wage and require paid sick leave to employees believe there is bipartisan support growing for a solution.

A fix is needed before the end of year, officials said, to prevent wage and job losses in the hospitality sector.

“Let’s get some bills in September, so we have some vehicles for lame duck, and then let’s continue the conversation,” John McNamara, vice president of government affairs with the Michigan Restaurant and Lodging Association, said. “Let’s not let this get lost in what can be a very, could be a very, very long and messy lame duck.”

McNamara added he was confident the Legislature could come to some bipartisan agreement, acknowledging it might come “later than the industry wants” but hopefully by the end of the year.

His comments followed a roundtable with servers and hospitality workers at Nuthouse Sports Grill in Lansing. It was one of a series of recent events held across the state.

The Michigan Supreme Court in July ruled that two voter-initiated measures were unconstitutionally adopted and amended several years ago involving worker wages and mandated paid sick time (See Gongwer Michigan Report, July 31, 2024).

Under the ruling, the tip credit will be completely phased out to the full minimum wage by February 2029, while the minimum wage would be $12 per hour plus the inflationary adjustments made by the state in February 2028. Mandated paid sick time for workers is also enacted under the ruling.

Business groups have warned that the decision would devastate small businesses, particularly in the hospitality sector, unless legislative action is taken before the measures take effect in February.

So, have servers and bartenders, who, on Wednesday, told lawmakers that the law changes, if left to take effect, would trickle down to businesses through job losses and a decrease in customers.

Democratic leadership and Gov. Gretchen Whitmer have said little publicly about what, if anything, they might do.

Sen. Sam Singh (D-East Lansing) said he anticipates there being ongoing discussions over the next few months to work out a solution, with an important part of the process now being to gather input from those affected by the law.

“Hopefully, we’ll … find a landing place that makes everyone whole from a financial standpoint,” Singh said. “That’s what we really want to do, is make sure that people are getting the increase of wages that was the initial intent behind this ballot initiative from 2018.”

The groups that led the 2018 petitions to raise the minimum wage and enact paid sick time have defended them as important quality-of-life policies and warned against softening them.

John Sellek, spokesperson for Save MI Tips, said it was important for people to understand that many servers and bartenders make above the minimum wage on good nights, and the changes in the law are not a pay raise for them.

The support to find a solution exists and is bipartisan, Sellek said.

“Some legislators are more ready to say they’re on our side than others,” Sellek said. “In particular, legislators who have already worked in the industry, they were a server or a busser or a bartender at some point in their past lives, Democrats and Republicans, they are right on board with us, right away.”

He used the example of multiple Democratic lawmakers at an event in Macomb County who worked in the hospitality sector in the past and were supportive of finding a solution.

“This is not only good policy, but it’s good politics,” Sellek said. “Honestly, if you’re running for reelection and you have a huge swath of your working-class people in your district saying: ‘my income is going to be slashed by half, but you can do something about it,’ it happens to be one of those opportunities where good policy also equals good politics.”

Those who have been waiting to transport certain hazardous materials over the Ambassador Bridge are in luck.

Beginning Oct. 29, the Department of Transportation will lift restrictions on transporting some fuels and materials for batteries over the bridge. The change follows six months of research, including meetings with law enforcement and first responders and reviewing comments submitted by the public.

The owners of the Ambassador Bridge, the Detroit International Bridge Company, requested the modifications. The changes had to be approved by MDOT, as state law designates the department as the agency responsible for determining where restricted materials cannot be carried. MDOT commissioned a technical study to evaluate the risks in June 2021.

The Detroit International Bridge Company has a fire suppression system and spill mitigation protocols and materials in place. Restricted materials will only be transported during off-peak hours and under the supervision of vehicle escorts.

“This action by MDOT after a four-year public process dramatically improves safety in the State of Michigan and enhances the smooth flow of international commerce in the Detroit-Windsor corridor,” a statement from the Detroit International Bridge Company said. “Lifting the restrictions reduces the number of miles driven by commercial motor vehicles hauling fuel in Michigan by over 250,000 miles annually, providing a substantial net safety benefit… it will not create any material truck traffic increase on the Ambassador Bridge.”

The Ambassador Bridge crosses the Detroit River and connects Detroit to Windsor, Ontario, in Canada.

House Republicans are unveiling their policy plan ahead of the November election with the intent of letting voters know priorities should they win back the gavel.

“Republicans are ready to govern on day one,” House Republican Campaign Chair Rep. Bill Schuette (R-Midland) said. “We’re presenting options to make life more affordable for Michigan, to make this a better place to start your business, start your family, live your life, ways to grow our economy and grow our population.”

Affordability, education, and safety are among Republicans’ top priorities, Schuette said.

The list of Republican objectives includes making the 2023 income tax reduction to 4.05 percent permanent, cutting energy bills and housing costs by eliminating green energy mandates and lifting permitting fees, prioritizing local control and local energy production, modernizing nuclear power generation, and expanding natural gas production.

When it comes to education, members of the HRCC said it’s time for schools to “return to the basics.”

Those basics include soft skills, like showing up on time, and basic math and reading. Republicans also highlighted the near elimination of designated mental health and safety funding in this year’s School Aid Fund budget. The caucus also wants to give parents a bigger role in their children’s education.

Community safety is another area the committee focused on, with priorities including recruiting and retaining more police officers, eliminating “sanctuary counties” in Michigan, and supporting crime victims. Republicans have labeled counties that refuse to have their law enforcement cooperate with federal immigration authorities “sanctuary counties,” though it is disputed whether any such counties exist in Michigan.

The committee also highlighted infrastructure funding for both rural and urban areas as a priority. Members of the committee, who spoke on background, said infrastructure had been underfunded for too long and additional money was needed. Members didn’t suggest new sources of revenue, rather, they said that budget spending should be reprioritized.

The point in putting forward their ideas now, Republicans said, is to show Michigan voters they want to center policies, not politics.

“We’ve put together a mission for Michigan that 60 to 70 percent of our entire state can get behind, and hopefully, the Democrats can too,” Rep. Bryan Posthumus (R-Cannon Township) said.

In terms of work for this fall, Republicans were pessimistic, but Rep. Ann Bollin (R-Brighton) said she’d like to see the House get some of the economic development policies over the finish line, especially legislation that would allow the state to claw back money from development projects that have not fulfilled what they promised.

Posthumus also mentioned addressing the tipped wage and paid sick leave laws that resulted from the Michigan Supreme Court’s adopt-and-amend decision.

After the election, though, Posthumus said he hoped for a light lame duck.

“I want to see us go home,” he said. “If you look at the past, some good policy gets done in lame duck, but also some dangerous policy, too, and I’m a little concerned what policies Democrats are going to put forward.”

With the House up for election this fall and control of the chamber up for grabs, which energy policies might be taken up before the end of the year remain an open question.

“We don’t entirely know the lay of the land as to how we’ll proceed prior to the election,” Sen. Sean McCann (D-Kalamazoo), chair of the Senate Energy and Environment Committee, said last Thursday.

The tentative Senate agenda lists regular session days for most of September and October, while the House schedule only lists three full weeks of session ahead of the Nov. 5 elections.

McCann added he is not yet sure what latitude he and other Senate committee chairs will have to hold hearings before the election.

If Republicans win control of the House, Democrats will face a short window in the lame duck period to push through their remaining policy priorities before a shift to divided government in January.

“Everyone is looking at the clock,” McCann said of the legislative calendar. “It’s hard to predict on how that will play out.”

He admitted that the results of the House elections could affect how the lame duck period goes at the end of the year.

“Lame duck’s always been an interesting animal,” McCann said.

The 2018 lame duck period was very busy, given Democratic gains in statewide offices, prompting Republicans to push through several key priorities. In 2022, Democrats won control of the Legislature, and the Republican majorities at that time opted not to work through lame duck.

McCann said the big question is what energy policy items might still come up this year. He pointed to legislation dealing with accountability for polluters as an example.

“We may or may not have the chance to look further into it,” McCann said.

The senator said there is the possibility of taking up potential legislation that would enact an “extended producer responsibility” policy, an environmental policy that holds producers responsible for product management in all stages of a product’s lifecycle, including disposal.

The introduction of legislation dealing with carbon capture and sequestration could be possible in the fall, McCann said.

Action on PFAS legislation is also a possibility, he added.

Outside of legislation, he would like to learn more about federal monies awarded to the state and how those funds are being used.

This includes a $129 million federal grant from the U.S. Environmental Protection Agency to the state for the implementation of multiple renewable energy initiatives (See Gongwer Michigan Report, July 26, 2024). Another $110 million in federal monies was also provided to the state in 2022 for electric vehicle charging infrastructure expansion.

Despite the recent slow period, McCann said the committee has made significant strides in energy policy this session.

“Being a part of getting the clean energy package to come to full realization was a huge accomplishment,” McCann said. “That took up a lot of oxygen last year.”

This year, the policy agenda was lighter due to work on the most recent budget. There was also the 54-54 tie in the House with two vacancies that were filled by Democrats later in the spring.

National dollars are being spilled in the fight for the House majority, with both the Democratic Legislative Campaign Committee and the Republican State Leadership Committee pouring money into the state.

The Democratic Legislative Campaign Committee announced its slate of target races across Michigan and an additional $500,000 to defend the Democratic majority.

Most of the races highlighted by the committee are expected to be close, and many of them are being specifically targeted as seats to flip by Republicans.

The DLCC is particularly interested in 13 spotlight candidates, including Rep. Matt Koleszar (D-Plymouth) in the 22nd House District; Rep. Jaime Churches (D-Wyandotte) in the 27th House District: Democrat Janise Robinson, who is running to unseat Rep. Jamie Thompson (R-Brownstown Township) in the 28th House District; Rep. Reggie Miller (D-Van Buren Township) in the 31st House District; Rep. Mai Xiong (D-Warren) in the 13th House District; Rep. Joey Andrews (D-St. Joseph) in the 38th House District; Rep. Jim Haadsma (D-Battle Creek) in the 44th House District; Democrat Daniel Mahoney, who is running against Rep. Kathy Schmaltz (R-Jackson) in the 46th House District; Democrat Shadia Martini, who is hoping to unseat Rep. Donni Steele (R-Orion Township) in the 54th House District; Rep. Nate Shannon in the 58th House District; Rep. Denise Mentzer (D-Mt. Clemens) in the 61st House District; Rep. Betsy Coffia (D-Traverse City) in the 103rd House District; and Rep. Jenn Hill (D-Marquette) in the 109th House District.

All of these seats, except for Xiong’s, which leans well to the Democratic side, are expected to be competitive.

“Michigan Democrats in the statehouse passed common sense gun safety legislation, improved access to Medicaid, and protected fundamental reproductive freedoms, demonstrating the transformative impact of Democratic power in the states,” DLCC President Heather Williams said in a statement. “Preserving this trifecta could hinge on just a single seat in the state House, which will determine the future of fundamental freedoms for Michiganders.”

House Speaker Joe Tate (D-Detroit) said in a statement that the 13 candidates identified by the DLCC embody the vision Democrats have for the future of the state.

“As speaker, I know firsthand that our incredible candidates are already on the doors with voters talking about the work of the Democratic trifecta that has protected reproductive freedom, expanded health care access and shielded Michiganders from gun violence,” he said. “I’m confident that these are leaders who are ready to serve with integrity and will be strong voices for opportunity in Lansing. The stakes are high, but we have the best candidates possible to ensure Democrats maintain our trifecta in Michigan.”

Across the aisle, the Republican State Leadership Committee announced investments in key states, including Michigan, for the 2024 elections.

Already, the committee has spent $3.9 million in Michigan. The money is going toward “supporting critical campaigns, expanding voter outreach, and building data infrastructure that will be key to Republican success,” a press release from the RSLC said.

“We know that the Democrats intend to flood the battleground states with millions of dollars down the final stretch of the election, which is why the RSLC’s early investments are so critical to winning in key battleground states,” RSLC President Dee Duncan said in a statement. “By investing early and supporting strong Republican candidates, we are able to maximize our funds over the course of the cycle so we can secure decisive victories in November.”

National money, historically not a factor in state legislative races, poured into Michigan in 2022 and proved a key factor in helping Democrats win control of the House and Senate.