NITC Project Deal Met

The United States Department of Homeland Security and the Transport Canada Minister confirmed this week that an agreement has been reached, moving one step closer to allowing the New International Trade Crossing (NITC) project to move forward.

The latest deal on the $2.1 billion project for the new bridge between Detroit and Windsor, Ontario, is for the customs plaza. Reportedly, Canada will provide financing for most of the customs plaza in exchange for toll revenue. The United States has agreed to provide staffing for the plaza, an estimated $100 million in the first year and $50 million each year thereafter.

Much work still remains before all aspects of the project are finalized, including the construction of a freeway-to-freeway connection to the span. Additionally, NITC still faces court challenges from Ambassador Bridge owner Manuel “Matty” Moroun.

posted by PAA Online , Friday, February 20, 2015 11:26 AM
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Tax Credit Fiscal Impact Analysis Climbs

During a presentation to the House Tax Policy Committee this week, Michigan Economic Development Corporation (MEDC) officials more than tripled the estimated fiscal impact of committed tax credits available through 2031. The credits, granted by the former Michigan Economic Growth Authority (MEGA) have been a hot topic in Lansing since late last year. The credits have been designated as the cause of projected budget deficits for the current 2014-2015 fiscal year and the upcoming 2015-2016 fiscal year.

In December, the MEDC and the Department of Treasury estimated the total liability to be approximately $3 billion through 2031 when the credits would run out. Those projections were based on an assumed 35 to 50 percent of credits being awarded. When projecting based on 100 percent of full value, the number rises to $9.38 billion.

The state will spend between $500 and $600 million per year until 2030, according to the MEDC, ending with $129 million in 2030 and $133 million in 2031. No new credits are being awarded under the Michigan Corporate Income Tax, which took effect in 2012.

To address the issue, MEDC President Steve Arwood told the House panel that corporations utilizing the credits will be asked to provide an annual three-year credit projection and that the consensus revenue estimating processes will now include total credit liability estimates.

posted by PAA Online , 11:25 AM
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Senate Finance Committee Recap

Student Loan Tax Credit Debated

The Senate Finance Committee heard testimony from Senator Curtis Hertel, Jr. (D-East Lansing) on Tuesday regarding Student Credit Loans. The Senator’s proposal, Senate Bill 57, would allow an individual to claim a credit against the state’s individual income tax for up to 20 percent of the average yearly tuition for amounts paid on state or federal student loans. This would be applicable only to graduates for the first five years post-grad, and would require the individual be a resident of and employed in Michigan.

Employers may also be eligible for a Corporate Income Tax credit under this legislation. This tax credit would amount to 50 percent of the amount of payments made by the employer on a qualified student loan on behalf of a qualified employee (postsecondary graduate) during the tax year, or 20 percent of the average yearly tuition for Michigan’s public universities per employee, whichever is less.

In his presentation, Senator Hertel called attention to the average debt for 2013 Michigan college graduate, which is more than $29,000 – a 2 percent increase from the prior year. In addition, 37 percent of recent graduates have chosen to leave the state for opportunities elsewhere. In this current situation, half of the 63 percent of college graduates who are still living in Michigan likely have some form of student debt. Senator Hertel is hopeful SB 57 can address both financial concerns of recent graduates and keep more of them in the state.

The Department of Treasury and Senator Marty Knollenberg (R-Troy) both expressed concern over the tax credit idea. Other members of the Committee questioned whether the tax credit will truly help students remain in the state or if the fault lies with inopportunity from employers.

The Committee did not take a vote on the proposal, stating that it needed more adjustments. Senator Jack Brandenburg (R-Harrison Township), Chairman of the Committee, commented that he is open to all ideas to fix these issues and looks forward to seeing what progresses from here.

Principal Resident Exemption Measure Passed

The Senate Finance panel also heard testimony on Senate Bill 81, ultimately passing the measure to the Senate floor in unanimous fashion. The bill, sponsored by Committee Chairman Brandenburg, allows lending institutions to maintain the tax benefits of a principal residence exemption on a property for two years when the lending institution takes ownership of the home due to foreclosure.

Proponents of the measure, including the Michigan Credit Union League and the Michigan Realtors described that maintaining the exemptions will make it easier on prospective purchasers to qualify for mortgages and move the foreclosed homes away from the institution’s ownership quicker.

The Department of Treasury and organizations representing public school groups were opposed to the measure claiming the proposal will result in significant lost revenue to the State School Aid Fund.

posted by PAA Online , 11:24 AM
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PAAdvisory Briefs

DLCC Hires Schauer to Rally Democratic Seats

The Democratic Legislative Campaign Committee (DLCC) recently hired Mark Schauer, former Michigan gubernatorial candidate, to be the director for the committee’s Advantage 2020 program. Advantage 2020 is a program where Mr. Schauer and his team will work with state leaders and partners in the Democratic community to help gain back control in state legislatures across the country. As 36 states, including Michigan, have their lawmakers directly involved in the redistricting process, it’s imperative to Mr. Schauer and the DLCC to increase the number of Democrats in state legislatures before the 2021 redrawing to avoid Republican’s having an upper hand in the process.

U.S. Representative Dave Trott Announces Staff

U.S. Representative Dave Trott (R-Birmingham) has appointed Doug Tietz as his district director and Katie Campbell as staff assistant, both of whom worked on the Representative’s campaign. Carol Ann Fausome has been selected as Representative Trott’s constituent advocate. He also appointed Kristine Zrinyl, Henry Gembis, Connie Hudas, and Nick Kennedy as his district representatives.

Lindsay Vogelsberg Promoted to Director

House Speaker Kevin Cotter’s (R-Mt. Pleasant) Deputy Legislative Director Lindsay Vogelsberg will replace Jeremy Hendges as Legislative Director, effective March 2^nd. Mr. Hendges is departing the Speaker’s office to join the Michigan Economic Development Corporation (MEDC). Ms. Vogelsberg has served as Deputy Legislative Director to both Speaker Cotter and former House Speaker Jase Bolger in addition to serving as a lead staffer for former Representative Bob Genetski.

Lon Johnson Reelected Democratic Chair

At the Democratic Convention this past Saturday, Lon Johnson was reelected as the party’s Chair, granting him his second term and another shot at a gubernatorial win. As expected, no one ran against Chairman Johnson for the race, despite the party’s frustration with the 2014 election results. When accepting his position, Chairman Johnson stated that the party needed to set higher goals and hopes to begin this path by better engaging the delegates in the state party.

Middle Eastern American Commission Created

Governor Rick Snyder created the Middle Eastern American Commission this week to be housed in the Department of Civil Rights. The Commission will succeed the Council on Arab and Chaldean American Affairs, which Governor Snyder created in 2013. The Governor did not provide a timeline for making appointments to the Commission but stated that a commission will have greater visibility and authority than that of a council.

posted by PAA Online , 11:15 AM
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