Governor Delivers Third State of the State Address

After outlining roughly 23 new proposals or budgetary actions, Michigan Governor Rick Snyder concluded his 55-minute State of the State Address Wednesday evening by mentioning he had been criticized for attempting to accomplish too much. The Governor’s third Address was made while approximately 150 protestors could be heard chanting and banging on drums on the Capitol lawn.

Overall, the Governor explained that Michigan’s share of the U.S. economy had been steadily dropping for 44 years – from 5.25 percent in 1965 to 2.5 percent in 2009. Since then, the state’s share had again begun to increase and the Governor described his determination to ensure the increase was not an anomaly, but the beginning of a decades-long process.

Transportation Funding Predictably Highlights Speech

Governor Snyder described the need to focus on transportation and infrastructure funding as a “pay now or pay later” scenario, where the price of paying later would be exponentially higher than that of paying now. Mr. Snyder’s numbers claim that an investment of $10 billion over the next 7 to 10 years would save the state roughly $15 billion, as the same goals would cost $25 billion 10 years from now.

While lacking in specific details, such as percentages, Governor Snyder’s proposal focuses on three primary elements:

1.) Changing the current $.19 per gallon gasoline tax to a percentage tax on gasoline at the wholesale level

2.) Increase in vehicle registration fees

3.) Local option for registration taxes for local road and bridges

Governor Snyder characterized the move as costing the average driver roughly $120 per year, but also mentioned the new plan could result in as many as 12,000 new jobs and 100 saved lives each year.

Governor Proposes Campaign Finance, Election Changes

Governor Snyder praised the hard work of Secretary of State Ruth Johnson, while proposing additional transparency in elections and encouraging voter participation.

The Governor called for allowing no-reason absentee voting for people who apply for an absentee ballot in person at a Clerk’s office with existing photo identification requirements. He also supports permitting online voter registration in the same manner currently used for changes to address in the state’s verification system. Currently, voters must be of a certain age, be away from their voting precinct or have some other reason allowed by law to vote absentee.

As in 2012, the Governor renewed his call for quarterly reporting for candidates during non-election years. This would put Michigan in line with the federal model which requires quarterly reporting. The Legislature did not take action on this issue last session.

Other notable proposals included a call to revisit the Blue Cross Blue Shield reform package vetoed at the end of last session, as well as the legislation creating the Education Achievement Authority. Also, while not directly mentioning the tragedy in Connecticut earlier this winter, Governor Snyder called upon state officials to improve mental health programs and school security.

A full transcript of the Governor’s third State of the State address can be found at: http://www.legislature.mi.gov/documents/2013-2014/Journal/house/pdf/2013-HJ-01-16-002.pdf or the video version viewed at: http://www.michigan.gov/snyder/0,4668,7-277-63747---,00.html

posted by PAA Online , Friday, January 18, 2013 12:02 PM
LINK DIRECTLY TO THIS ARTICLE

Snyder to Create New Insurance Department

As anticipated, Governor Snyder indicated he will create a new department to handle insurance and financial matters. The new department, made by splitting the Office of Financial and Insurance Regulation (OFIR) from the Department of Licensing and Regulatory Affairs (LARA), will also help promote the insurance industry, which has become more prominent in Michigan.

The new Department of Financial and Insurance Services is receiving praise from both sides of the no-fault auto insurance debate. Insurance advocacy groups see potential for additional powers to the new Department Director, Kevin Clinton, not granted him when he was OFIR commissioner. They believe it will allow the Director to take a more active role in the promotion of the insurance industry in terms of trying to grow the financial and insurance sector in the state. The Coalition Protecting Auto No-Fault sees the move as a chance to reduce rates without changing the system.

The Governor also called for the creation of an Insurance and Fraud Prevention Authority. The authority will partner with state and local law enforcement and the insurance industry to provide education, training and enforcement programs to reduce incidents of insurance fraud. The authority will be funded through a $2 per vehicle assessment on insurance companies.

posted by PAA Online , 11:59 AM
LINK DIRECTLY TO THIS ARTICLE

State Revenues Holding Steady

The Revenue Estimating Conference participants agreed that revenues to the state are meeting expectations as Governor Snyder and the Legislature prepare to write the 2013-2014 fiscal year budget.

While several tax policy changes implemented last year reduced the amount of expected revenues available for the current 2012-2013 fiscal year, that would be made up with better than expected revenues for the 2011-2012 fiscal year that ended September 30.

The Conference agreed on a net revenue estimate of $8.79 billion for the General Fund for the 2012-2013 fiscal year, a drop of 5.1 percent from the previous year. Net School Aid Fund revenues will be $11.8 billion, a 2.3 percent increase.

For the upcoming 2013-2014 fiscal year, General Fund revenues will rise 5.4 percent to $9.26 billion. For the same year the State School Aid Fund will rise 2.7 percent to $11.43 billion. This is down $38.9 million from the May estimating conference.

Between the state closing the books with $200 million more than expected in revenue as well as $90 million in lapses from unspent money by departments, the Governor and Legislature will have $290 million in extra money for the 2013-2014 budget.

Governor Snyder will unveil his budget recommendation for the 2013-2014 fiscal year to a joint session of the House and Senate Appropriations committees on February 7.

posted by PAA Online , 11:58 AM
LINK DIRECTLY TO THIS ARTICLE

Grant to Set-up State Health Insurance Exchange

Legislative Republicans’ ongoing opposition to the State developing its own health insurance exchange as required under the Federal Patient Protection and Affordable Care Act resulted in Governor Snyder’s working on a state-federal partnership to do the same, and this week that partnership has led to a sizable grant to aid in the efforts.

U.S. Health & Human Services Secretary Kathleen Sebelius announced the $30.7 million grant as part of an overall $1.5 billion effort to aid 11 states.

The grant is intended to assist the Michigan Department of Licensing and Regulatory Affairs (LARA) in conducting an analysis on the impact of the exchange in Michigan, as well as securing contractual services for legal, technology planning, education and outreach, and financial and policy matters.

House Republicans had opposed accepting a $9.8 million grant last session for setting up the state exchange. The Legislature will have to approve spending the new grant before the funds may be utilized.

posted by PAA Online , 11:58 AM
LINK DIRECTLY TO THIS ARTICLE

Last Week's Survey Results

The question in the January 11^th PAAdvisory asked readers which topic they believed would be the most talked about when the legislature returns.

“Healthcare reform” received 17% of the votes, as did “education reform,” while 66% of the votes went to “transportation funding reform.”

posted by PAA Online , 11:57 AM
LINK DIRECTLY TO THIS ARTICLE

PAAdvisory Briefs

December Unemployment Remains Steady

Seasonally adjusted unemployment rates held steady at 8.9 percent in December according to a report released this week. The state’s workforce realized a decline of 11,000 workers in December; however, remains up 28,000 overall from December 2011. The report also highlights the third consecutive year of declining unemployment since a high of 13.4 percent in 2009.

Re-election Looks Promising for Schostak

Current Michigan Republican Party Chair Bobby Schostak appears to have no major challengers getting in between him and his bid for a second term as Party Chair. Governor Rick Snyder and Lieutenant Governor Brian Calley have publicly expressed their support for Mr. Schostak to be re-elected. Republican strategist John Yob has also openly shown support for Mr. Schostak, which comes as a surprise given the two sides clashed last year.

New Executive Director to Lead Cable Telecommunications Association

The Michigan Cable Telecommunications Association (MCTA) has formally selected Matt Groen as new Executive Director to succeed recent retiree Colleen McNamara. MCTA’s Board of Directors approved Mr. Groen, who previously worked as the association’s Government Affairs Director.

posted by PAA Online , 11:56 AM
LINK DIRECTLY TO THIS ARTICLE

Question of the Week January 18, 2013

posted by PAA Online , 11:16 AM
LINK DIRECTLY TO THIS ARTICLE

This Week's Newsletter

Past Newsletters