Detroit to Proceed With Bankruptcy

A federal judge has given Detroit the go ahead to proceed with the city’s bankruptcy this past Wednesday, meaning billions of dollars owed investors, city employees, and creditors will not be paid. A restructuring plan is supposed to be presented by March 1^st, and it’s unknown whether pension cuts will be included in the plan.

Unions and protestors have made the argument that the city should not be able to cut pension in order to reduce the debt. They argued that negotiations with creditors were not made in good faith.

U.S. Bankruptcy Judge Steven Rhodes ruled that pension cuts will be fair game to be included into the restructuring plan but made sure he stated that does not necessarily mean that he will approve the cuts.

Detroit Emergency Manager Kevyn Orr said he will continue to negotiate with as many creditors as possible.

Many retirees and workers of the city of Detroit are bracing for benefit cuts.

posted by PAA Online , Friday, December 6, 2013 11:46 AM
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New Fracking Proposal Introduced

A proposal for a new set of administrative rules with regards to fracking was presented to the House Energy and Technology Committee by Hal Fitch, an official in the oil and gas division of the Michigan Department of Environmental Quality (DEQ).

State residents have demanded that there be more transparency to the rules for fracking.

The first step to improving transparency was to provide a geographic map of on the DEQ’s website with well locations. The map allowed comments from Michigan residents that would help gain approval from the public regarding wells in those residents’ areas.

Committee Chairman Representative Aric Nesbitt (R-Lawton) voiced his concern about how much the new regulations could cost the industry. Representative Nesbitt questioned the need to update the rules when Michigan has some of the best fracking regulations in the country.

Mr. Fitch is expecting the new rules to take effect in the fall of 2014.

posted by PAA Online , 11:45 AM
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Sovereignty Questioned in Bay Mills Tribe Casino Case

Michigan has been challenged by the Supreme Court as to whether or not a Bay Mills Tribe-operated casino has endangered the tribe’s sovereignty.

The Bay Mills tribe purchased land in Vanderbilt and opened a casino without first receiving approval from the federal government. Tribal casinos may exist on tribal owned land, as long as the land is first approved by the federal government, which the Bay Mills tribe failed to do.

Numerous states have an interest in the case due to the fact that a ruling could possibly limit the opening of new casinos.

The tribe’s argument was that the opening of the casino does not threaten the state’s sovereignty and that the tribe’s basic sovereignty would not allow the state to take action against the casino’s opening.

The tribe’s attorney, Neal Katyal, argued that the tribe could be subject to penalties for operating a casino that is considered illegal if the Supreme Court did not make a ruling in favor of the tribe.

posted by PAA Online , 11:44 AM
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State Employee Wage Increase to Offset Healthcare Changes

The impasse panel released a recommendation over the weekend that would allow state employees to see a 2 percent raise for the next two years. The recommendation would require state employees switch to a less expensive healthcare plan.

Under the new proposal, employees would receive a 0.5 percent lump sum payment in October 2014 and 2015 along with a 2 percent pay increase during those two years. Employees will face additional costs under the new healthcare plan in which they enroll, which would be offset by the lump sum the employees would receive.

The proposal comes as a compromise between the Office of State Employers (OSE) proposal of a 2 percent raise in 2014 and 1 percent increase in 2015 and the union’s proposal of 3 percent for both years.

The unions argue that state employees cuts over the past few years need to be restored and that there are enough funds available to accomplish this, while the OSE argues that current wages for state employees are fair and competitive.

posted by PAA Online , 11:43 AM
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November 22nd Survey Results

In the November 22^nd edition, PAAdvisory asked, “Presumptive Democratic Gubernatorial nominee Mark Schauer has released a plan calling for a phased-in increase to the state’s minimum wage, currently at $7.40/hour. The plan would increase the wage to $8.00/hour in the first year, $8.60/hour in year two, and $9.25/hour in year three. The plan would also tie the wage to inflation thereafter. What are your thoughts on the state’s minimum wage and this plan?”

a. I think the minimum wage should stay right where it is.

b. I like this plan.

c. I think it should increase, but more quickly.

d. I think it should increase, but not as much.

45 percent of respondents answered “a. I think the minimum wage should stay right where it is.” 27 percent answered “b” and like Mr. Schauer’s plan, while another 27 percent answered “d” and believe the minimum wage should be increased – just not as much as called for in this plan.

posted by PAA Online , 11:43 AM
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PAAdvisory Briefs

2014 House Calendar

House Majority Floor Leader Jim Stamas (R-Midland) this week released the House of Representatives session calendar for 2014. The House will reconvene on January 8, 2014 and have session as usual on Tuesday and Wednesdays at 1:30PM and Thursdays at 12 Noon. Spring Break is scheduled for the first two weeks of April with summer recess for the majority of both July and August. Only 4 session days are tentatively scheduled for those two months. After reconvening the second week of September, the House is also scheduled to recess for most of October – presumably for campaign purposes. The last two weeks of November are scheduled as recess for hunting and Thanksgiving, as usual, and the last day of session is planned for December 18, 2014.

Snyder Remains Opposed to Abortion Measure

With the Board of State Canvassers approving the issue for the 2014 ballot this week, the Legislature is now in control of the proposal to require individuals to purchase separate insurance policies to cover elective abortions. The Governor has voiced his ongoing opposition. He vetoed legislation last year calling for the same reform, however, this ballot proposal is not subject to gubernatorial approval or veto.

Financial Distress Processes Move Forward for Locals

Governor Rick Snyder announced the appointment this week of full review teams for Highland Park and Royal Oak Township after the State had previously determined the probability of financial stress. In addition, the Local Emergency Financial Assistance Loan Board found probable financial stress in Lincoln Park following the Department of Treasury’s preliminary review. The review found, among other things, that 46 percent of the General Fund revenues were necessary for covering retirement pension and health care obligations and debt service.

Congressional Run Out for Benson

The decision was made by Jocelyn Benson not to run for the 11^th U.S. House District seat. Benson had been recruited very heavily by the Democratic Congressional Campaign Committee to run for the seat. It has been discussed that Benson could possibly run again for the Secretary of State seat in 2014.

posted by PAA Online , 11:41 AM
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Question of the Week 12/6/2013

posted by PAA Online , 10:55 AM
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