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June 11| This Week in Government: Legislation Making Some PPE Purchases Tax Exempt Heads To Governor, Detroit Chamber Poll: Vax Intake On Rise, Workers Want To Stay Remote

Each week, the Detroit Regional Chamber’s Government Relations team, in partnership with Gongwer, will provide members with a collection of timely updates from both local and state governments. Stay in the know on the latest legislation, policy priorities, and more.

  1. Legislation Making Some PPE Purchases Tax Exempt Heads To Governor
  2. Detroit Chamber Poll: Vax Intake On Rise, Workers Want To Stay Remote
  3. Supplemental Would Use $1.5B Of Federal COVID Relief On Bridge Repairs
  4. Duggan: No-Fault Law Has Not Ended Higher Costs For Detroit
  5. As Budget Talks Continue, Whitmer Urges $450M For Preschool Program

Legislation Making Some PPE Purchases Tax Exempt Heads To Governor

Bills looking to make the purchase of personal protective equipment exempt from sales and use tax were sent to Governor Gretchen Whitmer on Tuesday as the House concurred in Senate changes.

Both HB 4224 and HB 4225 passed the full Senate last week in a unanimous vote, and were back before the House for a vote to concur changes made through an S-1 substitute, with both passing 102-7 (See Gongwer Michigan Report June 2, 2021).

The bills would exempt from sales and use tax certain PPE and supplies for businesses that had implemented a COVID-19 safety protocol plan. The Department of Treasury would determine an exact formula on the exemption.

Fiscal estimates put the potential revenue loss to the state if the bills were passed at up to $18 million for the life of the exemption.

The Department of Treasury did not have a position on either bill when passed by the Senate, and Governor Gretchen Whitmer’s office did not say whether or not she would sign the bills.

Whitmer spokesperson Bobby Leddy, when asked if Ms. Whitmer would sign the bills, referred questions back to Treasury.

The bills both saw broad, bipartisan support, with HB 4225 sponsored by Rep. Sarah Anthony (D-Lansing).

Speaking with Gongwer News Service after the vote, Ms. Anthony said she was optimistic the governor would sign the legislation as, “these bills do align with many of her priorities, which is about getting the economy back on track and supporting not only businesses, but also workers.”

“This bill really does both of those: it provides some support for business to actually make sure that their employees still have personal protection equipment – facemasks, gloves, hand sanitizer, disinfectant – which, again, aligns with what she’s been talking about with making sure we’re opening up and opening up safely,” Ms. Anthony said, adding that the legislation did include several safeguards including a sunset so that this would not be available in perpetuity.

Detroit Chamber Poll: Vax Intake On Rise, Workers Want To Stay Remote

While more than two-thirds of individuals have received at least their first shot of a COVID-19 vaccine, an overwhelming number of workers want to have at least some portion of their job stay remote when transitioning back to a pre-pandemic routine.

That’s according to a poll released Monday by the Detroit Regional Chamber – which surveyed 600 registered Michigan voters between May 22 and May 26 – covering a multitude of issues including businesses’ response to the COVID-19 pandemic, voting rights and people’s plans regarding a return to in-person work.

“After conducting multiple polls in 2020, the Chamber wanted to reassess how voters feel about Michigan’s health, economy, and political situation,” Sandy Baruah, president and chief executive officer of the Detroit Regional Chamber, said in a statement. “Fifteen months into the pandemic, voters are seeing clear progress in controlling COVID-19 and are broadly receptive to vaccinations but are still reserving judgment about the speed with which they want to return to ‘normal’.”

The Chamber found that while 54.1 percent have been working at their job site during the pandemic, more than two-thirds (77.4 percent) would prefer at least some portion of their job to be remote. About 50.4 percent indicated they would prefer a combination of working at the office and from home.

Regarding COVID-19, 77 percent of respondents said they have received a vaccine or plan to – up from the 53 percent of responders in December 2020. About 75 percent of respondents, however, noted that they still planned to use COVID mitigating items like masks while in public places, leading the Chamber to suggest that businesses consider phasing out COVID-19 precautions “as a majority of employees and customers will need time to adjust.”

It was also found that opinions on voting rights have stayed strongly polarized, though the majority of people do believe in making it easier to cast a ballot. Those who strongly leaned Democratic (96.5 percent) believed Michigan’s elections to be safe and secure while those who strongly leaned Republican (56.6 percent) did not. By a 2-1 margin, however, most voters older than 65 believed it should be easier to cast a ballot; 51.8 percent of all individuals surveyed also believed it should be easier to vote.

On the topic of voting rights, it was found 71.3 percent of respondents had not heard of the 39-bill package brought forward by Republicans and making its way through the Legislature currently, which seeks to curb access to voting through a series of reforms rooted in the belief that the 2020 presidential election was rife with improprieties.

Of the bills within the package, however, it was found that four have a majority of bipartisan support including requiring voters to present a government ID when voting in person, allowing young adults applying for their driver’s license to pre-register to vote so that they are already registered when they turn 18, that local clerks should be allowed to prepare absentee ballots for counting as they are returned – similar to what is already in effect in places like Florida – and that clerks should be required to be open for voting hours the second Saturday before Election Day.

There were also strongly polarized feelings on the current job approval of Governor Gretchen Whitmer, with more than 90 percent of individuals identifying as strongly leaning Democratic approving of her work while more than 90 percent of individuals identifying as strongly leaning Republican did not. Men were more likely to disapprove of Ms. Whitmer than women, the chamber’s polling indicated.

Supplemental Would Use $1.5B Of Federal COVID Relief On Bridge Repairs

The sponsor of a supplemental appropriations bill that would repair or replace severely damaged bridges using federal coronavirus relief funding said the investment would be able to resolve a significant infrastructure need and provide decades of benefits.

Introduced Wednesday by Sen. Wayne Schmidt (R-Traverse City) was SB 529, which would allocate $1.626 billion in federal coronavirus relief funding mostly for repairing bridges in poor condition in the state.

Of the federal funding, $1.5 billion would be directed to the bundling of local agency bridges program while the remaining funds provided to the local rail grade separation program.

The bill requires bridges included in the program to be subject to available funding according to three priority areas. The first priority is locally owned vehicle bridges currently closed to traffic. Second would be locally owned bridges currently posted or restricted from Michigan legal loads and the third would be locally owned bridges in need of repair or replacement as rated by the Regional Bridge Councils to ensure safety and unimpeded commercial traffic.

“When we look at those monies, this is what, talking to constituents throughout the state, this is what they want to see done with those COVID dollars: actual infrastructure projects,” Mr. Schmidt said in a Wednesday interview.

Mr. Schmidt said out of about 7,000 locally owned bridges, about 400 are in severe condition and in need of repair or replacement in line with the priorities laid out in the bill.

Governor Gretchen Whitmer earlier this year proposed supplemental appropriations to the tune of $300 million in one-time General Fund spending to address 120 of the state’s most deteriorated bridges, including 59 that are currently closed (See Gongwer Michigan Report, February 11, 2021).

Mr. Schmidt said the governor and the House have both discussed putting a few hundred million into unsafe bridges but said the state should go further.

“We have these COVID dollars. Let’s address these issues once and for all and put that money into infrastructure, specifically bridges,” Mr. Schmidt said. “I think it’s high time we do it. That’s a really good use of these one-time dollars, something that’s going to last 30, 40, 50, 60, 70 years down the road.”

Mr. Schmidt said he has been a member of the Senate Transportation Committee since joining the Legislature and as the Senate Appropriations Transportation Subcommittee Trackchair he saw it as the right thing to do.

As to rail grade separations, he said the funding could improve safety for school buses as well as make it more efficient for emergency responders to get to a location more quickly.

Under the bill the Department of Transportation would be required to provide a biannual progress report to the House Appropriations Committee Trackand Senate Appropriations Committee Track, with the first report due October 31, 2021.

In the report, data to be included would be a list of bridges under the bridge bundling program in which repairs have been completed, a list of scheduled bridge repairs through the program for the current fiscal year, the amount spent to date and the amount of funds remaining.

Funds for projects under the program would be considered work project funds and would not lapse at the end of a fiscal year but be available until a project is completed.

Overall, the state is set to receive about $10.1 billion under the federal American Rescue Act. Of this, $4.4 billion will go to local governments.

Republicans have expressed an interest in making significant infrastructure investments with the federal funding, which they have said would be a great investment to resolve major infrastructure needs.

A message left Wednesday with a Department of Transportation spokesperson was not immediately returned.

The bill was referred to the Senate Appropriations Committee Track.

Duggan: No-Fault Law Has Not Ended Higher Costs For Detroit

EAST LANSING – Detroit Mayor Mike Duggan, who championed the 2019 no-fault law changes as bringing significant relief to city residents long charged far more than others in the state, said Tuesday that the law did not eliminate the geographic differences in auto insurance rates.

It was a notable admission from Mr. Duggan, one of the law’s leading champions, that the law did not deliver on a measure legislators and the Whitmer administration insisted at the time it did: remove one of the leading non-driving factors in rate-setting. The use of ZIP codes in setting auto insurances rates was barred. However, it was well-known at the time that the legislation still allowed insurers to use “territory” as a rating factor and critics said that mechanism would be used to continue charging Detroit motorists far more than residents elsewhere in the state.

The law did provide rate relief to all motorists, including those in Detroit, but a large difference in rates remains.

“The one thing I think the governor and I would probably agree on that we did not get in the first round of legislation we’d like is to eliminate the territorial differences. Geographically, Detroiters are still being charged more,” Mr. Duggan said at a Tuesday news conference with Governor Gretchen Whitmer on an unrelated topic.

In 2019, as Ms. Whitmer signed the no-fault bill, Lt. Governor Garlin Gilchrist II wrote a column for The Detroit News extolling what it would mean for his fellow Detroit motorists.

“It’s clear this is a tremendous opportunity for all 7 million drivers in our state, but it’s drivers in southeast Michigan who really seek to benefit from this deal,” he wrote. “Under the previous law, insurance companies could use non-driving factors, such as ZIP code, gender, marital status, occupation, education, home ownership, and credit score to determine insurance rates. This led to rampant redlining that targeted neighborhoods across southeast Michigan, took money out of the pockets of hardworking families and kept drivers in poverty.”

Mr. Duggan made the remarks when he and Ms. Whitmer, together at a news conference on preschool, were asked for their thoughts on calls from providers of treatment and care for those catastrophically injured in traffic crashes for the state to amend the auto insurance law to delay or change the new fee schedule that limits them to charging 55 percent of what they previously charged insurers.

The mayor said he would support changes if the higher charges for Detroiters are first addressed.

“I have said to those folks, ‘Before you start making changes to raise the rates, let’s get everybody’s rates level,’ and I would fully support what they are proposing, if it’s coupled with a provision that everybody in Michigan pays the same geographic rate,” he said. “I think that’d be a fair solution. I told them if they can get that, I’ll support them. But I don’t think it’s right to be raising rates on Detroiters when they’re still higher than the rest of the state.”

Ms. Whitmer, who has taken some heat from allies for signing the no-fault bill, said she is open to discussions on changing the fee schedule.

“I have indicated to the legislative leadership that I am open to having a conversation around narrowly addressing some of the rate issues,” she said. “I know that some have suggested maybe they pause before these go into effect and have that conversation to determine if there’s something that makes sense here. I’ve not gotten indication yet that there’s interest in doing that but that is something I’m open to. I’m concerned about it as well.”

Senate Majority Leader Mike Shirkey (R-Clarklake) has said he opposes changing the law before it takes effect.

As Budget Talks Continue, Whitmer Urges $450M For Preschool Program

EAST LANSING – The latest funding proposal from Governor Gretchen Whitmer as she and the Legislature negotiate a budget for the upcoming fiscal year, as well as how to spend the billions in federal aid the state has received, is to use $450 million to assure all children eligible for Great Start Readiness Preschool have access to the program.

In recent weeks, Ms. Whitmer has announced her funding priorities in a series of public events as she and her administration work behind closed doors to work out a budget framework. Those have covered the economy and education.

Currently, one-third of the children eligible for the Great Start Readiness Program, a state-funded preschool program, are unable to attend based on available funding, but Ms. Whitmer on Tuesday proposed using federal funds and surplus state monies to assure sufficient capacity so all eligible children can attend.

Ms. Whitmer, at a news conference with Detroit Mayor Mike Duggan and the Democratic leadership in the Legislature, proposed using $255 million federal money and $150 million in state funds for the next three years to enable the estimated 65,400 eligible 4-year-olds to attend the program.

The Great Start Readiness Program provides full- or part-day preschool to families at or below 250 percent of the federal poverty level.

Ms. Whitmer and the Legislature, both majority Republicans and minority Democrats, are in discussions about finalizing the 2021-22 fiscal year budget, and the expansion Ms. Whitmer proposed would require legislative approval.

“We have a unique opportunity right now to make the type of investments in early education and preschool that will pay massive dividends by improving health, educational, and social outcomes for our children decades down the line,” Ms. Whitmer said in a statement. “Parents across our state are aware of the importance of early education and now we have to seize this chance to eliminate waitlists for eligible children. The investments announced today provide access to all eligible children and will help narrow the achievement gap between high-income and low-income students. As we put Michigan back to work, parents can go about their workday knowing that their children are learning in a safe and productive environment.”

Ms. Whitmer’s proposal would use another $50 million in federal funds for grants to providers to ensure sufficient capacity, access to transportation, scholarships to early educators and expanding outreach efforts to inform parents of program availability in their area.

Mr. Duggan, on hand at Tuesday’s news conference, said it looked like this proposal would come to fruition last year for the current fiscal year, but the budget turbulence caused by the COVID-19 pandemic scuttled those plans.

“There is nothing we could do more to give our children a better start to their education than as a 4-year-old to have full-day pre-K,” he said. “The amount of nurturing and education that goes on in a quality pre-K is life-changing.”

There are 4,000 Detroit children in preschool in Detroit, but more than 1,500 do not have a spot, he said.

Ms. Whitmer said she is confident that while these funds would cover the expansion of the program for the next three fiscal years, revenues will keep growing to sustain it beyond then.

The proposal was welcomed by a cross-section of business groups and child advocates.

“Manufacturers support the use of American Rescue Plan funds for long-range investments that spur growth for residents and businesses – and Governor Gretchen Whitmer’s proposal to expand the Great Start Readiness Program will do just that,” said John Walsh, president and CEO of the Michigan Manufacturers Association, in a statement. “Our state’s largest and most impactful sector needs the best and brightest talent to compete globally. This investment in high-quality preschool programming will help improve learning outcomes, increase student achievement and enrich Michigan’s talent pool for years to come.”

Matt Gillard, president and CEO of Michigan’s Children, said the group is “over the moon” about the governor’s proposal.

“This is not only the right thing to do for Michigan families and the state’s most at-risk children who have been shut out of preschool education though legally eligible, but it marks a momentous and historic point in the evolution of needed expanded public education to ensure a highly literate population and productive future workforce,” Mr. Gillard said in a statement. “Unless all at-risk Michigan children receive the targeted support they need to enter school ready to learn, develop reading skills and thrive, they and our state’s future will continue to be compromised compared to other states.”