New Energy Proposal Sees Discussion

The Senate Energy and Technology Committee adopted several substitutes to the Senate’s energy policy proposals. These substitutes focus on the rules and regulations guiding utilities and their operations.

The two bills, SB 437 and SB 438, are not finalized according to chair Senator Mike Nofs (R-Battle Creek), but represent a solid foundation. Senator Nofs is focusing on four policy goals of reliability, shared responsibility of providing reliability and resources, ensuring there is not subsidization of energy prices for one group by another, and the creation of an integrated resource plan for cost-effective investments by utilities for ratepayers.

SB 437 outlines criteria on power supply cost recoveries and expands a Utility Consumer Participation Board (UCPB). Under this, the UCPB is allowed to make grants for rate cases as well as the interprocess communication (IRP) process. Further clarification on what cases the UCPB and the attorney general can intervene in will also be added. The certificate of need (CON) process is relatively the same, but the triggering mechanism dropped to $100 million from $500 million. CON will be maintained through December 31, 2018 when the IRP process will assume control.

The IRP will have a final stage approval process where any projects approved for the first three years have to be placed back out for bid to ensure the costs are reflective of the time it’s approved. This process is different than the automatic presumption that currently exists for such projects. SB 437 also includes resource adequacy, which is the ability to supply load during prime load and generation outage conditions.

The legislation maintains the 10 percent cap and grandfathering provisions for customers participating in electric choice. Customers who are 100 percent on retail open access will have an opportunity to allow for expansion to occur at an existing facility or adjacent facility for commercial customers as long as they own 50 percent of that adjacent facility. Customers can also leave and join as they wish. The commission will determine an appropriate generation capacity charge on any new customers after the legislation passes, but regulated utilities are still responsible for their capacity for 10 years.

SB 438 sets energy optimization standards and green pricing programs. It includes intricacies of cost recovery for investments and sets utility incentive standards that align with Governor Rick Snyder’s goal of energy waste reduction. It also establishes a 30 percent blended goal for utilities to meet by 2025. The 30 percent combines renewable energy and waste reduction, renewable energy including fuel that has been manufactured, in whole or part, by waste.

Utilities under this legislation will have green pricing programs, in which customers can request that their energy come specifically from renewable resources. The Public Service Commission will approve rates for the program, but the customer will be responsible for any additional costs. Energy efficiency programs will also be phased out.

Net metering is renamed distributive generation. The customer’s allowable size changes to 100 percent of the customer’s average annual consumption. The amount of distributed generation by an electric utility or alternative electric supplier is increased to 1 percent of peak state load from the preceding year or up to 10 percent of the average and peak loads for the preceding five years. Customers currently participating in net metering systems can continue to do so for the next 10 years.

posted by PAA Online , Friday, April 29, 2016 10:11 AM
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Campaign Finance Deadline Passed

Michigan campaigns reported their finance records for the latest quarter, showing Republicans having a slight edge overall.

The Senate Republican Campaign Committee (SRCC) raised over $530,000 between January 1^st and April 20^th whereas the Senate Democratic Fund saw $225,000. Specifically, the SRCC had $530,373 in contributions with $45,685 in expenses. The cash on hand totaled more than $1.5 million. Top contributors included Blue Cross Blue Shield of Michigan (BCBSM) PAC, Moving Michigan Forward Fund II, Realtors PAC, Meijer PAC, among others.

The Senate Democratic Fund’s contributions totaled $224,906 with $52,381 in expenses. Cash on hand totaled $616,227. Senate Minority Leader Jim Ananich’s (D-Flint) campaign committee contributed to the Fund along with Blue Cross Blue Shield of Michigan (BCBSM) PAC, the Michigan Association of Realtors PAC, DTE Energy Company PAC, among others.

House Democrats raised $502,644 in contributions compared to House Republicans’ $434,326 in the period between January 1^st and April 20^th. However, Republican expenses only amounted to $29,575 whereas Democrats spent $124,530. Cash on hand for the Republicans is $1.96 million and $1.37 million for the Democrats.

Major contributions to the House Democratic Fund include House Minority Leader Tim Greimel’s (D-Auburn Hills) PAC as well as the Justice PAC, Michigan Education Association, DTE Energy, House Minority Floor Leader Sam Singh (D-East Lansing), among others. Representative Andy Schor (D-Lansing) believes the momentum is in the Democrat’s favor to gain the majority in the House.

On the contrary, House Republican Campaign Committee (HRCC) Finance Co-Chair Representative Chris Afendoulis (R-Grand Rapids Township) sees the Republican cash on hand edge as an advantage. Top contributors for the Republicans include Realtors PAC, DTE Energy, David Van Andel, the BCBSM PAC and House Majority Floor Leader Aric Nesbitt’s (R-Lawton) PAC.

posted by PAA Online , 10:10 AM
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Committee Addresses Michigan Tax Tribunal

The House Tax Policy Committee began hearing testimony on HB 5578, a bill aimed at clarifying the criteria used by the Michigan Tax Tribunal during an assessment dispute, aimed primarily at the use of comparable properties.

Sponsor of the bill Representative David Maturen (R-Vicksburg) said the purpose is to ensure the “highest and best use” of the property is relayed. The tribunal would be required to make an independent determination of the market which measures the potential uses of the property, economic viability, and competition. In comparable properties, the tribunal cannot compare with a use that is different from the highest and best use of the property, or if the sale or rental happened under different economic conditions than the highest and best use. The tribunal will determine information for each comparable that has been verified and discloses all private restrictions.

Vacant comparable properties will be excluded unless the vacancy is typical for marketing properties of the same class, if the timing is within a typical marketing exposure time period, if the vacancy does not reflect a use different from the highest and best use, or if the vacancy is not related to economic and market conditions different from the property.

Comparable properties with deed restrictions will also be excluded unless they assist in economic development of the property, if it was imposed for purposes of development, and does not materially increase the likelihood of vacancy or inactivity.

Tricia Kinley with the Michigan Chamber of Commerce testified that the chamber is not in favor of the bill. More testimony will be heard next week.

posted by PAA Online , 10:10 AM
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State Agency Budget Passed

The House cleared its budget for state agencies on Wednesday. HB 5294 passed 76-32 with a total budget at $38.68 billion.

In the legislation, an additional $500,000 is allocated to address staffing concerns at the Grand Rapids Home for Veterans and includes a possible funding increase if a solution is found on auto insurance credits. $112.7 million is going towards Hepatitis C and Cystic Fibrosis treatment and $43 million for the specialty drug reserve fund. Some of these initiatives come in less than what Governor Snyder had recommended, but House Speaker Kevin Cotter (R-Mount Pleasant) commented initiatives could see an increase as credits are appealed or solutions are found.

Representative Sam Singh (D-East Lansing) attempted unsuccessfully to amend the budget to prohibit funds being used to defend the governor in criminal cases related to the Flint water crisis. Democrats also attempted to reverse the Senate’s plan to move to the Capitol View building.

$108.6 million is provided for Healthy Michigan matching funds. The State Board of Education was stripped their per diem payments and $150,000 was given for a veteran’s ombudsman. Healthy Kids Dental was given $25.6 million, and the Department of the Attorney General was provided $2.6 million for lawsuit settlements related to Flint with another $30 million for issues related to the crisis.

posted by PAA Online , 10:09 AM
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PAAdvisory Briefs

Ballot Proposal Sees No Action

Ballot proposal groups presented a plan before the Board of State Canvassers on Monday to set up a process to validate ballot proposal petition signatures older than 180 days. Due to the absence of Colleen Pero and Norm Shinkle, the proposal saw no action. Mr. Shinkle commented with SB 776, a bill that clarifies only signatures collected within the 180-day window can be valid; circulating through the Legislature, it may no longer be a Board of State Canvassers issue.

Paul Welday Passed Away

Paul Welday, a Republican activist and strategist passed away Monday of an apparent heart attack. He was 57. Mr. Welday has been involved in every level of governance and politics from being the former chair of the Oakland County Republican Party, to chief of staff to former U.S. Representative Joe Knollenberg. He also ran for both the Michigan House and Congress. Visitation and funeral services will be held in Farmington and Farmington Hills.

President Obama Coming to Flint

President Barack Obama is visiting Flint next Wednesday in order to view the water crisis personally. Details of his visit have yet to be released. Currently, Governor Rick Snyder is not scheduled to be in Flint that day, but he may rearrange his schedule. Governor Snyder’s press secretary Anna Heaton stressed the Governor is in Flint every week and the resources on the ground are ongoing.

posted by PAA Online , 10:08 AM
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