March 7, 2025 | This Week in Government: Trump Delays Tariffs for Detroit Automakers

President Donald Trump on Wednesday announced a one-month delay in tariffs on imports from Mexico and Canada for U.S. automakers.

The announcement came after the tariffs took effect on Tuesday and subsequent conversations on Wednesday occurred between Trump and Ford, General Motors and Stellantis, the Associated Press reported.

It’s the latest chapter in Trump’s tariff policies, which were originally set to take effect last month before the president delayed the implementation.

While the 25% tax on autos traded through North America are paused for now, Trump’s spokesperson said the president will impose “reciprocal” tariffs to match the taxes and subsidies other countries charge on imports beginning April 2. The president urged the domestic automakers to “get on it,” referring to moving all of their manufacturing to the U.S., the A.P. reported.

On Tuesday, Trump put 25% taxes on imports from Mexico and Canada, taxing Canadian energy products such as oil and electricity at a lower 10% rate. The president also doubled the 10% tariff he placed on China to 20% (See Gongwer Michigan Report, March 4, 2025).

Glenn Stevens Jr., executive director of MichAuto, said the postponement of the tariffs on automotive related trade is “somewhat of a reprieve,” but said the damage has already been done.

“For an industry that operates in three-to-five-year product cycles, this level of day-to-day uncertainty is debilitating,” Stevens said. “MichAuto will advocate for all of the proposed tariffs, across industries, to be rolled back in the interest of the state and nation’s economic prosperity. With Michigan’s global automotive and economic competitiveness on the line, lifting these tariffs is the necessary path forward.”

U.S. Rep. John James (R-Shelby Township) posted on X, formerly Twitter, that the president is standing up for Michigan workers.

“Trump understands the complexity of the auto industry. I have been in contact with … the Trump Administration, as well as reps of the auto industry,” James wrote. “We will continue to work to get more cars built in MI, more cars sold around the world, and more jobs back in MI!”

U.S. Rep. Debbie Dingell (D-Ann Arbor) was mostly positive about the tariff pause in a statement Wednesday.

“This delay is a positive step to give our auto industry more time to talk these issues through and to have important discussions with all stakeholders involved,” Dingell said. “As I’ve said, tariffs are a tool in the toolbox, but they must be strategic and support American jobs – not create uncertainty that undercuts our domestic manufacturing. The domestic auto industry currently relies on an integrated North American supply chain and our trade policies need to reflect that. I will continue working with all stakeholders and I want to work with President Trump to onshore these supply chains and ensure these policies strengthen American manufacturing and keep our workforce competitive.”

Republicans and Democrats both made moves to advance the conversation around long-term road funding on Thursday.

Gov. Gretchen Whitmer met with Democrats from the House and the Senate Thursday morning to discuss her roads plan.

In attendance were Rep. Alabas Farhat (D-Dearborn), Rep. Jason Morgan (D-Ann Arbor), Rep. Samantha Steckloff (D- Farmington Hills), Senate Majority Leader Winnie Brinks (D-Grand Rapids), Sen. Veronica Klinefelt (D-Eastpointe), and Sen. Jeremy Moss (D-Southfield).

The lawmakers assembled by the governor will serve as the Democratic point-people for roads negotiations, and the governor plans to be very engaged in process, according to a source speaking on background.

House Republicans also introduced their bills for a road funding solution on Thursday (See Gongwer Michigan Report, March 6, 2025). The bill package includes HB 4180, HB 4181, HB 4182, HB 4183, HB 4184, HB 4185, HB 4186, and HB 4187.

House Speaker Matt Hall (R-Richland Township) emphasized that the Republican plan requires no additional revenue, even with their proposed plan to reduce the individual income tax rate and will hold the School Aid Fund harmless.

“We can absolutely find the money within the existing resources,” said Rep. Ann Bollin (R-Brighton), chair of the House Appropriations Committee. “Are there some tough decisions? I think maybe, but I would say that we have a lot of money locked up in projects.”

To ensure that the School Aid Fund is held harmless, the first $755 million in Sales Tax revenue will be set aside for the School Aid Fund, said Gideon D’Assandro, acting press secretary for Hall.

That level of funding is equivalent to the current 20 cent gas tax earmarked for the School Aid Fund. Other revenue from the sales tax that is not already earmarked will be up for debate in the budget process.

The Michigan Infrastructure and Transportation Association praised the progress on roads in a statement on Thursda

“As Michigan approaches the road funding cliff this year, significant progress is being made toward a long-term funding pan for Michigan’s transportation infrastructure,” Rob Coppersmith, executive vice president of the organization, said in a statement. “We’re pleased that the proposals put forward by Gov. Whitmer and House Republicans both share a commitment to ensuring that all fuel taxes go toward fixing our roads and bridges and that both propose using a least $500 million in existing state revenues. This common ground marks a strong starting point for legislative negotiations.”

The Michigan Manufacturers Association expressed concern about the proposed Michigan Business tax hike proposed in HB 4186 by Rep. Steve Carra (R-Three Rivers). The bill would increase the tax from 4.95 to 30%.

“The introduction of this bill damages Michigan’s reputation as a business-friendly state, by saying the state will not honor its agreements and does not respect the companies that chose Michigan as a location to grow and prosper for generations to come.”

House Republicans and Rep. Karen Whitsett voted to pass a close of books supplemental alongside a $20 billion spending plan for the 2025-2026 fiscal year.

The goal of passing the School Aid Fund and omnibus agency appropriations bills is to take a government shut down off the table as budget negotiations continue, House Speaker Matt Hall (R-Richland Township) said Thursday during a press conference.

“Let’s just stop the games. Democrats, stop using schools, and prisons, and veterans’ homes, and local governments and police as pawns in your political game to threaten the government shutdown,” Hall said. “We will give you your book closing, but what you need to do is you need to support our effort to keep vital functions of government open in the next fiscal year. We can link these things together.”

Democrats slammed the move. In the House, all but Whitsett (D-Detroit) voted against it, saying they saw the plan an hour before it was up for a vote. In the Senate, Democrats panned the House Republicans for sending the proposal over.

The $20 billion is about a quarter of the current budget. About $15 billion would go to schools with a per-pupil increase but many items in the current budget are missing. Other dollars would go toward the Department of Corrections, Department of State Police, veterans’ homes, revenue sharing, debt obligations, and other government functions that are most at risk for a government shutdown.

The appropriations included in the bills cover the constitutionally required areas of the budget.

HB 4161, the general omnibus, passed 59-48. Whitsett (D-Detroit) was the lone Democrat to vote in support of the bill.

The omnibus bill provides $1,596,169,700 ($1,582,066,600 General Fund) for the Department of Corrections; $123,435,600 ($120,899,700 General Fund) for the Judiciary; $170,952,400 ($59,150,600 General Fund) for Military and Veterans Affairs; $596,285,900 ($456,930,600 General Fund) for State Police; $246,170,600 (General Fund) for the Department of Technology, Management, and Budget; $340,804,200 (General Fund) for the Department of Transportation; $94,881,000 (General Fund) for debt service; and $1,648,762,700 for revenue sharing.

The School Aid Fund bill, HB 4162, includes an increase in per-pupil spending to $10,025 per student. It passed 59-48 and was also supported by Whitsett.

The book-closing portion of the spending proposal for the 2023-24 fiscal year is about $45 million.

House Democrats, who learned of the plan about an hour before voting, were enraged.

“That is not how we are supposed to govern in the 21st century. If you have an expectation of us to do things in the public light, through public scrutiny and a deliberative process, to have an appropriations bill dropped on our desks within 30 minutes of session starting is not only inappropriate, but it’s fiscally reckless,” said Rep. Alabas Farhat (D-Deaborn), minority vice chair of the House Appropriations Committee, said. “We’re all in on finding waste and abuse, but that’s not how you do it. You don’t start by stripping government down to the services people rely on, you do it by actually having a deliberative process that includes both sides of the aisle.”

House Minority Leader Ranjeev Puri (D-Canton) said House Republicans were attempting to bring political rhetoric and create political talking points around the budget process.

“This is setting the stage for a government shutdown,” Puri said. “There’s a reason some level of critical service were kept to just make it easier for him to drag this budget out to get the political winds he seems to see. We’re not interested in that game.”

Several House Democrats and school interest groups expressed concern about the lack of education funding.

“We appreciate the House leadership moving a budget forward that includes key funding increase in areas that research has continued to support needed investments in,” Robert McCann of the K-12 Alliance of Michigan said. “Of course, we have questions about some of the concluding areas missing from the bill, including at-risk and career and technical education but take the appropriations chair at her word that this bill isn’t intended to represent a complete budget for our K-12 schools and look forward to continuing the discussion on finalizing a budget that support the needs of each and every student in Michigan.”

The partial spending plan for the 2025-26 fiscal year passed well ahead of the July 1 statutory deadline to finish the budget and the Oct. 1 start of the new fiscal year.

During the press conference, Hall said the bill would ensure Democrats can’t use schools and other government services as “pawns,” during budget negotiations.

The plan would, for the most part, continue the current level of government spending on government essentials, with added money for an increase in per-pupil spending and debt payments, Hall said.

“These are not the controversial parts of this budget, so let’s get them out of the way now,” Hall said. “Then, let’s focus on something that we really should all agree on: finding efficiency in state government.”

House Appropriations Committee Chair Rep. Ann Bollin (R-Brighton) emphasized that the proposed plan did not represent the House budget, but rather a starting point.

“We’re not working toward a shutdown,” Bollin said. “It is a government shutdown prevention plan to open up and start the conversation in earnest to show that we are serious about having an open and transparent process through the budget process.”

Bollin said it was fair for Democrats to question the transparency of the process, but that House Republicans have been met with resistance whenever they have tried to work together.

“That has been made very clear,” she said. “You’ve seen that with everything. We have it with ESTA. We had it during lame duck. We saw it with pushing bills last December. Now we see this resistance.”

Senate Majority Leader Winnie Brinks (D-Grand Rapids) questioned House Republican’s motivations.

“Is Speaker Hall anticipating his own failure to get a budget done? We haven’t seen a government shutdown in a long time, and there’s no good reason why he should be predicting one now unless he wants it to happen,” she said in a statement. “He can keep trying to legislate via press release. However, in the upper chamber, we’ll keep doing the actual work of the people.”

Sen. Sarah Anthony (D-Lansing), chair of the Senate Appropriations Committee, called Hall and House Republicans reckless and their appropriations bills unworkable.

“Ignoring the essential funding needed to keep critical service that Michiganders rely on daily from DHHS, EGLE, LEO and other state departments running. The best way to avoid a government shutdown is to not manufacture one in the first place,” she said in a statement. “Instead of demonstrating leadership and coming to the table ready to work for the people of Michigan, he’s prioritizing political games.”

With these bills, Republicans have demonstrated their budget priorities, Farhat said.

“This is the Republicans opening position in a negotiation,” Farhat said. “When you start a budget, you’re saying where we ought to be investing. … The Republican’s opening position is cutting $5 billion in school aid, not funding DHHS, not funding EGLE, not funding DNR. … This budget started in such a drastic position that, honestly, it’s not worth entertaining at this time until they show that they’re willing to be serious.”

Legislation that would codify a federal drug pricing program cleared the Senate on Thursday with broad bipartisan support, although one opponent said more needs to be done to ensure the program is doing what it is intended to do.

Members voted 33-3 on SB 94, which would codify the federal 340B program.

The program requires pharmaceutical manufacturers that participate in Medicaid to sell outpatient drugs at discounted prices to health care organizations that care for uninsured and low-income patients. A second bill, SB 95, outlines transparency rules for th c ld incentivize providers to fully comply with the federal law as well as protect consumers from being subject to collections by providers that are out of compliance with federal requirements.

Those opposed to the bills have said the program has grown dramatically since its inception and questioned whether there are savings being passed on to patients.

Similar legislation cleared the Senate last December but did not get taken up in the House (See Gongwer Michigan Report, Dec. 13, 2024).

Sen. Sylvia Santana (D-Detroit), who voted no on both bills, said SB 94 “fails to address the real concerns about transparency, accountability, and most critically, ensuring that this program serves the patients that need it most.”

“Let’s be clear when we talk about transparency and accountability in 340B, we are talking about ensuring that the program actually benefits the patients it was designed to help,” Santana said. “Unfortunately, Senate Bill 94 does not achieve that.”

Santana said the program does not ensure that third parties do not profit without reinvesting into patient care.

“I hope that this bill moves forward and my colleagues in the House will take a serious look at these concerns and work to strengthen this legislation,” Santana said, “If we are serious about addressing systemic inequities, then we will need to ensure that programs like 340B are working as they are intended to work, not as a revenue stream, but as a lifeline to patients who need the help the most.”

Brian Peters, Chief Executive Officer of the Michigan Health and Hospital Association, in a statement thanked the Senate for its votes and urged the House to do the same.

“This bill prevents drug manufacturers from continuing to issue arbitrary restrictions on 340B eligible Federally Qualified Health Centers and hospitals,” Peters said. “We continue to be grateful for the Senate’s leadership and collaboration in recognizing the need for strong, quality healthcare providers over out-of-state prescription drug interest groups.”

Sen. Jonathan Lindsey (R-Coldwater), sponsor of SB 95, in a statement said the bill is a step in the right direction for enhancing price transparency in health care.

“Price transparency is a necessary tool to help reverse negative health trends,” Lindsey said. “While Senate Bill 95 is not the complete solution, it is an essential building block to making Michigan healthy again.”

Sponsors and experts testified in support of a package of bills aimed at growing the nuclear energy industry in Michigan before the House Energy Committee on Tuesday.

HB 4124, HB 4125, HB 4126, HB 4127, HB 4128, and HB 4129 would create a research and development tax credit for nuclear reactor technology, establish a nuclear and hydrogen education grant program, incentivize post-secondary graduates to work at Michigan nuclear facilities, and provide a tax credit for sellers of kilowatt hours of electricity produced using nuclear energy.

Rep. Pauline Wendzel (R-Watervliet), who chairs the committee and sponsored HB 4124, said the bills would make Michigan a leader in bringing small modular reactors, or SMRs, online for commercial use. SMRs are smaller-scale versions of advanced nuclear reactors that can be used to power data centers and artificial intelligence technology, as well as everyday energy needs in areas not well-connected to the existing electrical grid.

“We have three large nuclear reactors, two of which are currently online, that have been providing clean, reliable baseload energy to our state for the better part of 60 years. At their peak when all three were operating, about a quarter of Michigan’s energy was generated by these three nuclear power plants. Nuclear energy is experiencing a renaissance,” Wendzel said. “But the nuclear industry of today is not the nuclear industry of years past: small modular reactors represent the next generation of nuclear technology, and there is a race to bring this technology online for commercial use. This is an exciting opportunity and a huge win for our state.”

The bills have a two-pronged approach to growing the SMR industry in Michigan: one set pertaining to financial incentives for nuclear energy producers, and one dedicated to shoring up the state’s nuclear workforce. Sponsors of the latter group of bills hope to facilitate partnerships between the state, nuclear energy producers and Michigan universities and community colleges to keep graduates of pertinent degree programs in the state upon entering the workforce.

“In Michigan, we are blessed to have universities that train some of the most talented nuclear engineers and operators in the country,” said Rep. Joey Andrews IV (D-St. Joseph), who sponsored HB 4129. “The unfortunate problem is that they tend to leave the state and go to the rest of the country. So, we worked on this side of the package to encourage people to stay in the state, but also to encourage our universities and our community colleges to make investments in both the nuclear and the hydrogen workforce spaces.”

Supporters of the bill noted the safety and environmental benefits of modern nuclear energy generation, particularly as an alternative to fossil fuels that can create higher volumes of energy supply at a time than other green options like wind or solar.

Todd Allen, who chairs the Department of Nuclear Engineering and Radiological Sciences at the University of Michigan, detailed efforts in other states, like Ohio, Tennessee, Texas, and Indiana, to advance their nuclear power capabilities, and said the bills would give Michigan the opportunity to do the same.

“This legislative package does three important things – it incentivizes Michigan businesses to become part of the supply chain associated with the gross growth of nuclear energy, encourages growth in the workforce training and retention programs to support nuclear energy in the state and clarifies the citing requirements for advanced nuclear systems. These are all key steps for the state to take leadership in this technology,” Allen said. “Michigan has the capabilities to become a leader in the advancement of nuclear technologies, both as a host and as a key contribute contributor to supply chain. (UM) has long led the nation in graduating leaders in the advancement and use of nuclear technology. This legislation provides incentives to grow the use of nuclear energy and develop and keep this talent in the state.”

The bills are supported by Holtec Industries, Michigan Association of State Universities, Michigan Community College Association, Michigan Electric Co-Op Association, Consumers Energy, Utility Workers Union of America, Michigan Regional Council of Carpenters and Millwrights, and the Detroit Regional Chamber. The package is opposed by the Sierra Club.

The committee did not take action on the bills.