Detroit Ignores State Law, Turns Down Money to Avoid Selling Abandoned School

Detroit Public Schools Community District enforces deed restriction against charter

Photo courtesy of WDIV Detroit
Photo courtesy of WDIV Detroit

The conventional school district in Detroit is, by most measures, the worst performing district in the United States. Students have been fleeing for years, leaving for schools in other districts or charter schools in the city. To prevent that, the district is doing everything it can to stop parents from making this choice.

For years, the Michigan Legislature has tried to prevent conventional school districts from discriminating against other public schools by refusing to sell them older buildings. Twice, lawmakers have passed bills making these types of deed restrictions illegal.

But officials of the Detroit Public Schools Community District apparently don’t care. The district has dozens of abandoned buildings, but doesn’t want to give city students the opportunity to go somewhere else.

An abandoned elementary school, formerly owned by the district, has been up for sale since 2009. But the district refuses to allow the current owner to sell it to Detroit Prep Charter Academy, a highly rated school. Detroit Prep has been operating in the area, with support from the community, and it would like to expand and rehabilitate the building. (Here is a nice video report about the situation from Click on Detroit).

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“I can just envision our kids here,” said Kyle Smitley, the executive director of the academy. “I can envision how bright and joyful it's going to be. ... We think that with some TLC it can be a perfect, joyful place for our students. We love the neighborhood.”

So what’s the problem? A recent Wall Street Journal editorial explains:

The property includes “deed restrictions,” and one is that the buyer must pay a percentage fee to the school district. Detroit Prep has offered to pay the surcharge and more. The school district stands to reap $150,000 from the sale of a property it doesn’t even own. That’s on top of the $750,000 the school is paying for the building, “which is already 20 percent more than the developer’s purchase price,” as Ben DeGrow of the Mackinac Center for Public Policy has noted.

One more wrinkle. The deed stipulates that the Detroit school district must waive use of a property that isn’t residential, but Superintendent Nikolai Vitti has refused. This is a blatant violation of the law.

Questioned directly by lawmakers at a recent special hearing, Vitti said, "We, as a school district, find the act problematic, that it usurps the right of elected school boards to determine the future of their own assets.”

Detroit Prep is offering $750,000 for the building and another $150,000 to the conventional school district. But the recently bankrupt district would rather turn down the money and prevent better educational opportunities for children than make proceeds from a sale.

The district and the charter school are in a legal battle. Lawmakers, unsurprisingly, aren’t happy and are pursuing Senate Bill 702, to further strengthen the law and provide penalties for districts breaking it. So far the bill only has Republican support – but good for the legislators standing up for students.


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You Can Legally Warm Your Car Now

The Legislature should repeal more nonsensical administrative rules in 2018

Michiganders who usually idle their cars to warm them up before driving in the winter will be pleased to know they will no longer be breaking the law by doing so.

Last winter, we reported on the case of Nick Trupiano, who was ticketed $128 for leaving his car idling unattended in his driveway, in violation of the state vehicle code. A judge upheld the ticket and agreed with the ticketing officer that the rule was justified by the public safety threat of leaving running vehicles unattended.

But in June, the Legislature easily passed a measure repealing the rule. It amended the Michigan Vehicle Code to allow drivers with remote starters to leave their car running without a key in the ignition on public streets. It also rescinded the administrative rule that prohibited drivers from leaving unattended vehicles running in private driveways.

Cities and townships may pass similar ordinances that would apply to their jurisdiction, but it seems unlikely that many will. Local government officials, unlike administrative bureaucrats, are elected and accountable to their constituents. They’re less likely to pass ordinances that would criminalize something many people do on a regular basis.

When governments establish laws that create crimes or civil violations, it is important that they do so in a transparent legislative process. Legislators did not say Michiganders could not idle their own cars in their own driveways; bureaucrats did. The prohibition was part of an ever-changing body of administrative code that binds Michiganders, even though it was not created by their representatives.

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This is not a small problem – literally or metaphorically. Lawmakers have set forth over 3,100 crimes in statute, but the administrative rules and regulations that also govern our behavior number in the thousands. This means Michiganders could be in for a surprise like Trupiano’s – facing responsibility for violating a rule they did not know existed.

In the new year, lawmakers and government officials should resolve to seriously review the laws and rules that their constituents are expected to know and to follow — and remove ones that don’t directly help protect public safety.


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Facts About Michigan’s Infrastructure You Never Hear

Overall, it is serving us pretty well

In the debate about the condition of Michigan and America’s infrastructure, the doomsayers seem to have the loudest voices. Yes, more investment is needed, and there are some high profile disasters, but the news isn’t all bad — far from it.

Many who claim the sky is falling do so because they have a financial interest in more funding for infrastructure. Taxpayers will never spend enough to satisfy these folks. It’s easier to identify problems than to recognize successes. Exactly zero headlines read: “Water treatment plant working just as it should.”

High profile failures — the Flint water crisis, Macomb sinkhole and others — lead many to believe that these problems are the norm when in reality they are rare. Not infrequently, speculation is substituted for evidence-based conclusions, as in a Wall Street Journal article entitled, “Recent Hurricanes Strain U.S. Towns’ Aging Sewer Systems,” in which the article states: “Hurricanes Harvey and Irma … exposed the failings of aging sewer systems that were unable to cope with the heavy rainfall and flooding.” In fact, these sewers weren’t designed to handle such an apocalyptic storm.

The vast majority of our infrastructure, thousands and thousands of miles of roads, watermains, sewers, powerlines, wireless communications, and more is performing as intended — out of sight and out of mind. On balance, the water we drink and the treated sewage and stormwater we discharge to rivers and streams are cleaner than ever. Water quality data and robust habitats support this. Stormwater ponds and wetlands on many newer developments and business sites reduce storm flows to sewers, so they don’t have to be replaced with larger sewers, and these ponds and wetlands also purify the stormwater and enhance habitats.

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Trenchless Technologies give us the ability to fix underground pipes without digging them up. Minimally invasive infrastructure testing tells us the condition of roads, sewers, etc., with less user inconvenience. Asset management programs, smart systems, computer programs that analyze information such as age, maintenance history, materials, soils and more help communities and companies focus on the highest priorities and most vulnerable infrastructure before it breaks down.

This means our resources can be better targeted and disasters can sometimes be prevented. Better, stronger, more durable materials of construction are being developed for our infrastructure, giving us more options and reducing cost. Increasingly, intelligent transportation systems that monitor traffic maximize roadway capacities by providing drivers real-time information so they can make choices about which routes to take and autonomous vehicles and mobility systems will make transportation even more efficient and safer.

Does this mean we should be complacent? Hardly. There are infrastructure funding shortfalls in some communities, there isn’t enough “what could go wrong?” questioning, strict low-price bidding can leave us with inferior infrastructure, and we have a still-too-common “let it break then fix it” mindset. There’s plenty to do, but the debate should be grounded in evidence, not in hyperbole, scaremongering, or even the claimed “consensus.” Let’s keep things transparent, focus on what really needs to be fixed, and spend money wisely. In the meantime, our infrastructure is serving us pretty well.


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State Reforms of Occupational Licensing

New report from Cato highlights Michigan work

The newest edition of Regulation magazine from the Cato Institute features a piece on licensing co-written by Mackinac Center Director of Marketing and Strategy Jarrett Skorup.

The chapter is titled “The Latest on Occupational Licensing Reform” and notes that “at the federal level and in the state of Michigan, there have been encouraging moves toward market liberalization.” It is co-authored with Thomas Hemphill of the University of Michigan-Flint. An excerpt is below.

STATE LICENSING REFORM

The federal antitrust efforts and proposed legislation are promising, but the vast majority of licensing exists at the state level. The 2015 Obama administration report notes that the typical state licenses some 60 different occupations. Yet there is little evidence of positive effects resulting from such licensing on consumer health and safety.

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Most economic and policy experts from across the ideological spectrum agree that too many occupations are licensed, with results being negative economic effects. Researchers blame state-level licensing for fewer jobs, higher consumer costs, less competition, increased income inequality, and less social and economic mobility, among other negative externalities. Still, little has been done to lessen the licensing burden across the states. The percentage of workers requiring a license has risen from 5% in 1950 to nearly 30% today.

Michigan, however, is becoming an encouraging exception to that trend. Shortly after he took office in 2011, Gov. Rick Snyder established the Office of Regulatory Reinvention (ORR), which in turn created an occupational licensing advisory rules committee to review the nearly 200 occupations in Michigan that require some form of state licensing. In February 2012 the agency released a report calling for reforms to state licensing laws. It suggests changes based among other things on whether a license protects consumers from harm, requires specialized skills or training, and is aligned with state and national standards. The report offers several policy recommendations, including matching the total revenue from fees charged to licensees to the costs the state incurs in overseeing a licensed occupation (as opposed to using the fees as a general revenue source), reviewing the continuing education requirements, and reviewing licensing boards on “necessity, authority, and proper functions.”

Since the release of the ORR report, Michigan has repealed seven license requirements outright. (As a point of comparison, nationwide only about 15 state license requirements have been repealed in recent decades.) These include requirements on dieticians and nutritionists, auctioneers, community planners, oculists, school solicitors, immigration clerical assistants, and interior designers. The state also eliminated a few licensing boards and reduced regulatory requirements in other areas, such as the number of mandated apprenticeship hours required for a barber’s license.

In its current legislative session, the state seems poised to go further with occupational licensing reform. The Michigan House passed a package of bills that would severely reduce licensing requirements for many contractors, including painters, concrete workers, and window and gutter installers. In addition, about a half-dozen other de-licensing bills have been introduced.

Gov. Snyder has made it clear that he does not favor licensing as a regulatory tool. After taking office, he commissioned the ORR report, which led to real policy change, and also sent a letter to Michigan’s House Speaker and Senate majority leader saying he would not approve of new licenses that were not directly related to consumer health and safety. He wrote, “Going forward, we need to continue to exercise diligence and caution in determining whether to impose new regulations or requirements on any occupations—whether previously unregulated or not—and we should enact new restrictions only when they are absolutely necessary to protect the public welfare.”


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Supporters of free markets had little to cheer for based on what Michigan’s 99th Legislature did in 2017. There were certainly positives – such as public school pension reform – but lawmakers also indulged in a corporate-welfare potlatch party. Here’s a round-up.

House Bill 4001, (Don’t) cut the state income tax rate by 0.2 percentage points

Twelve Republican members of the Michigan House set the tone by defeating a modest income tax cut that would have reduced the current rate of 4.25 percent to 4.05 percent. The damage was compounded when Republican Gov. Rick Snyder chose to publically thank these 12 members for their votes to prevent a tax cut. With this action, the prospect of achieving any significant pro-growth reforms in this 99th Michigan Legislature largely evaporated, to be replaced by an explosion of cronyism and corporate welfare.

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Senate Bill 111, Redistribute $1.0 billion from state taxpayers to Dan Gilbert and other big developers

With income tax cuts off the table, lawmakers reverted to giving handouts to a privileged few. Detroit developer Dan Gilbert lobbied hard for his share and scored big. As introduced, the bill would have let Gilbert and possibly a few other developers simply pocket the income tax they withhold from their own employees (plus some other revenues). This was bit too transparent, so the final bill shuffles the money through Lansing first before handing it back to the developers. A few weeks after the vote, Forbes Magazine declared Gilbert the richest man in Michigan.

Senate Bill 242, Redistribute $200 million from state taxpayers to iPhone maker

Michigan lawmakers joined colleagues in other states in bending over backward to offer handouts to a Taiwan-based company that makes iPhones. Taking a page from SB 111, this one would let Foxconn essentially pocket up to $200 million worth of income taxes paid by its employees. The bill was also worded in a way that potentially would allow more firms to get in on the scheme.

2017 Senate Bill 469, Give some developers tax breaks for rehabbing “historic” structures

When he ran for governor in 2010, Rick Snyder’s top priority was reforming Michigan’s economically destructive business tax. In 2011 the Legislature passed and Snyder signed a sweeping overhaul of Michigan’s income tax for both businesses and individuals. Among many changes, this eliminated a variety of special income tax exemptions and deductions benefitting certain developers, nonprofits and individuals.

But like water flowing downhill, cronyism tends to expand in legislative bodies, as illustrated by a number of bill introductions and at least one vote to bring back the special privileges repealed in 2011. The vote was by the Senate on a bill to grant certain developers tax breaks and outright cash subsidies for rehab projects deemed by local and state corporate welfare officials to involve a “historic” structure – a form of handout that had been scotched by Snyder’s 2011 reform.

House Bill 4207, Subsidize some grocery stores in cities

This one was promoted as misguided social engineering, not “economic development,” but it’s no more likely to achieve its purported goals than the big corporate welfare bills. To address alleged food deserts in urban areas, the bill would earmark between $1 and $2 million annually to be divvied among a few urban grocery store and delicatessen owners. Specifically, stores that sell unprocessed or fresh meat, fruits and vegetables or dairy products would qualify. In fine cronyist fashion, protectionist language was added prohibiting subsidies for new stores opening within a mile of a competitor.

Coincidentally, in the same month the bill was signed into law, a study published by the National Bureau of Economic Research found that such measures are unlikely to have any impact on nutrition. The poor dietary habits of low-income households are, it said, largely explained by differences in “education, nutrition knowledge, and regional preferences” – not the supposed unavailability of fresh food.

House Bill 5013, Auto insurance reform

Michigan House Republicans took yet another run at reforming the state’s no-fault auto insurance system, which forces motorists here to purchase the most expensive coverage in the nation and makes insurance unaffordable for far too many.

The proposed bill would have given vehicle owners the option of purchasing less-than-unlimited personal injury protection benefits. It also would restrict the power of hospitals to gouge insurers – and through them, every vehicle owner – for the cost of treating crash victims.

Never mind the demagoguery about making the currently unlimited personal injury coverage optional (and still the nation’s most generous coverage), the real force against this bill was state’s hospital lobby. Big Hospital perhaps became the state’s most powerful special interest after the 2013 Legislature voted to accept the Obamacare Medicaid expansion. That move brought approximately $4 billion in annual “free” federal dollars that now flow to Michigan hospitals.

Senate Bill 335, Accommodate “Citizens United” ruling; authorize “super-PACs”

Finally, some good stuff actually passed. In 2010 the U.S. Supreme Court ruled that politicians may not restrict political free speech if the speaker is a corporation, a category that includes many nonprofits organized by individuals motivated by political beliefs. One consequence of the ruling was an explosion at the federal level of so-called “super-PACs,” which can engage in political speech, are not subject to spending limits and don't have to reveal the names of individual contributors to nonprofits that themselves donate to a super-Pac. In 2017 Michigan lawmakers accepted the premise by inserting essentially the same provision into this state’s complex campaign finance regulatory regime.

2017 House Bill 4999, Ban local food and beverage taxes

Former New York Mayor Michael Bloomberg made headlines by banning sugary soft drinks served in containers larger than 16 ounces. Subsequently, some communities around the country enacted local soft drink taxes. Some local politicians in Michigan apparently liked the idea, and it seemed just a matter of time before nanny-state local governments here followed suit. In a notably expeditious process, legislation preempting local taxes on food and beverages was introduced in late September and signed into law by Halloween.

Senate Bill 401, Reform School Pension System

By the start of 2017, unfunded taxpayer liabilities in Michigan’s state-run school pension system had soared $4.3 billion higher than when the Legislature enacted a faux-reform in 2012. This development undercut the credibility of those insisting that the status quo system was sound and sustainable, and strengthened the hand of legislative leaders who felt misled by some reform opponents inside state government.

Last year’s legislative product was messy and more complicated than it should have been, but it nevertheless appears to get the pension-reform job done. Starting next month, 401(k) accounts (with generous employer contributions) will be the default for new school employees. New hires who select a traditional defined benefit version will be on the hook themselves for future underfunding, which makes it unlikely that many will choose this option.


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Michigan Well-Being Metric Stuck in 'Balanced' Position

Changes in policy could attract more people

State-to-state migration may be the single greatest tool for comparing the quality of life in different states. Through moving, people reveal their preferences for where they wish to live. Opportunity is a major reason people move between states. That’s what makes the annual United Van Lines report on client moves so interesting.

The company, the largest household goods mover in the country, annually publishes its United Movers Study, which reports shipments of its clients around the contiguous 48 United States. The company then classifies states as “high outbound,” “high inbound” and “balanced,” depending on customer data. Four years ago, Michigan went from a high outbound move state (more than 55 percent of moves were outbound) to a balanced one — for the first time in 16 years.

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We are still losing citizens to other states though, based on data from United. In 2017, 51.9 percent (2,362) of its shipments were outbound. That’s still not an ideal position, but it is a much improved one from 2006-2009, when we sported the highest outbound traffic rate in the study.

While this is just one company’s report, it may be a good indicator for the direction of the economic data. In the past we have run a statistical analysis of United data with actual census data and found the two are highly correlated.

For 2017, Midwest neighbor Illinois holds the dubious distinction of being No. 1 state for outbound traffic. That is, 63 percent of United’s Illinois-related traffic was outbound. That is no small thing. When people move away from a state, they take their wealth, talent and the state’s future with them. They add all these qualities to their new home state. This Illini diaspora is not lost on many observers, including The Wall Street Journal and Mackinac Center scholars, as it has implications for the Great Lake State.

Of course, we in Michigan should not take any joy from the pain of Illinois. It was not long ago that Michigan held the No. 1 spot for outbound moves. Indeed, in 2009, Michigan’s outbound move rate hit 68 percent, a record in the data. The Great Lake State turned its fortunes around, however, and very likely because it adopted market-friendly tax and labor reforms. Much more can be done to attract people from other states to Michigan.

In 2008 the Mackinac Center attempted to identify what factors drive people to and from Michigan. We found through a sophisticated statistical analysis that, among other things, personal taxes, flexibility in labor markets and more days of sunshine were important.

We can’t overcome Michigan’s lack of sunshine, but we can make up for it on other fronts, such as cutting taxes. For every 10 percent increase in personal taxes, we estimate, we chase away 4,700 people every year thereafter.

If we want to make Michigan a state that opportunity-seeking migrants want to move to, we could start by lowering the state’s personal income tax rate and reforming many of the licenses required to hold a job in the state. This will make it easier to work, live and raise our incomes and our families, be they originally from Illinois, Florida, Texas or anywhere else.


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State Forces Hotels, Inns, To Fund Tourism Bureaus

Proposed law would prevent further legal challenges to compelled speech

The Mackinac Center for Public Policy’s legal arm files lawsuits on behalf of Michigan citizens wronged by some level of government or unions. As an example, the Mackinac Center has represented hotel and motel room providers seeking to defend their free speech rights against government intrusion into their business. Legislation introduced Dec. 5 by two Republican senators, Wayne Schmidt and Ken Horn, could thwart similar lawsuits in the future. Such a move would cement government-coerced speech into place. Rather than do that, however, lawmakers instead ought to strip the offending parties of their state-granted power to compel speech.

Senate Bill 703 would amend a law that lets tourism bureaus and private convention businesses impose an assessment — in effect, a tax — on hotel and motel rooms for the purpose of subsidizing tourism-related marketing efforts. Short of obtaining a full-on repeal of the practice, we’ve mounted a legal challenge on free speech ground. But the Republican bill would suffocate a legal argument we have used in court. This is one item in a package of bills (703-707) that would “insert these same provisions into different laws that authorize private bureaus to impose a room tax on lodging facilities,” according to Michiganvotes.org.

The Mackinac Center Legal Foundation has twice filed lawsuits on behalf of accommodations providers on the grounds that government cannot compel commercial speech unless it controls the industry through large subsidies or heavy regulation. Our clients were both assessed by a local tourism agency to subsidize its marketing efforts. The two lawsuits we’ve filed represented inn and cottage owners in northern Michigan. They were dismissed, but not for lack of merit.

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The first lawsuit ended because the owner sold his property and retired. The second was dismissed after the local taxing agency — Sleeping Bear Dunes Visitors Bureau — assured the judge it would not impose the assessment on our client in the future, nor would it seek assessments that were past due. So we have never had the opportunity for a court to judge the constitutionality of our cases. That’s unfortunate, because it appears as if the two Lansing politicians are trying to find a legal workaround to ensure this subsidized marketing scheme is a constitutional one. In other words, they would make a bad policy even worse.

The legislation looks like an attempt to get around future lawsuits by granting the state greater oversight, thereby making the activities these bureaus engage in to promote tourism “government speech.” Government speech is more likely to be held constitutional as opposed to speech compelled by a private group that has simply been authorized by the government.

The distinction may seem slight. But under the precedents set by the United States Supreme Court, when government officials take an active role in promotion of a marketing scheme, that speech then becomes the government’s. A person cannot legally object (on First Amendment grounds) to what the United States secretary of state says on our behalf when he announces policy. Likewise, a person cannot challenge a marketing scheme that puts forth “the government’s message,” even if it does so with that person’s taxes or assessments.

The legislation even specifically says in writing “The coordinated efforts within this act to market and promote tourism represent a broader regulator scheme [emphasis added] that does not impinge on an individual’s first amendment rights.” It adds that nothing in the act should be construed to … “require any owner or participant to adopt any actual or symbolic speech.”

If the legislation is enacted, a business owner who is forced to pay for tourism promotion speech won't be forced to adopt that speech, as the backers of the change claim. But that would only be true because the courts would then rule that it is no longer his own speech: It would be the government's speech. Ironically, those who favor the bill claim that by making government take over more control over advertising, it is infringing less on the rights of business owners who must charge and collect the assessment.

Under the bill, the tourism bureaus would still function as the mandatory advertising agency that the hotel and inn owners may not have wanted to hire. But an extra layer of government would give to the tourism bureaus the privileges given to “government speech.” Such speech is immune from a legal challenge and can only be challenged at the ballot box.

Lawmakers have extended their reach into the industry and business world enough with the corporate welfare programs they’ve created in past years — including two new large subsidy programs in 2017. In this instance, it seems that lawmakers are more concerned with keeping money flowing to local tourism agencies than protecting the free speech of residents. That’s a shame: They should be working to rollback cronyism in Lansing, not expand it.

 


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30 Years for the Mackinac Center for Public Policy

Our research helped usher in significant reforms

This year the Michigan-based Mackinac Center for Public Policy celebrates its 30th anniversary. What started out in 1987 as an experiment grew into one of the nation’s largest and most influential state-based think tanks. Although our methods have evolved over time — once a traditional white paper shop, we’re now a multifaceted change agent — we’ve never wavered from our guiding principle: Freedom makes all the difference.

The Mackinac Center shaped history in Michigan and beyond. Our research helped usher in significant reforms, including charter schools, right-to-work laws, tuition tax credits, privatization, transparency, tax relief and other education reforms. Mackinac Center ideas now live on in the Michigan Constitution, state statutes and public opinion.

Mackinac’s been a leader among state-based think tanks for decades. We’ve trained more than 600 think tank executives from 47 countries, landed three Roe awards and developed the popular theory of change known today as the Overton Window — named after our late vice president, Joe Overton, the namesake of another SPN award. The Mackinac Center is a state think tank with a national reputation and an international following.

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Fresh off our founding, we jumped into the education reform debate and fervently advocated for giving parents more control over their children’s schooling. Shortly thereafter, in 1993, Michigan adopted a charter school law, and today, parents of more than 150,000 students enroll their children in charters.

We’ve also helped the state get its long-term costs under control. Like most states, Michigan offered pensions to public employees but failed to adequately fund them. In 1997, the Legislature followed our recommendation and closed Michigan’s state employee pension system, saving taxpayers billions over the last two decades. And then earlier this year, we helped close the massively underfunded school employee pension system too.

Arguably our largest policy win was making Michigan a right-to-work state. We made this case consistently for nearly 30 years, before it was popular or even thought possible. The Legislature passed a right-to-work law in 2012, an unlikely development without the Center’s commitment to worker freedom. Now hundreds of thousands of state employees, teachers and other workers no longer have to pay money to a union just to keep their job.

In addition to our policy research, we’ve also successfully litigated to protect Michigan families against government overreach. The most notable of these examples is the SEIU’s “dues skim,” which allowed this government union to literally steal money from some of our most needy residents. We exposed this racket and eventually got it shut down, and thanks to our effort, other states and the U. S. Supreme Court followed suit.

We’ve had other successes along the way. We remain the only consistent voice in Michigan opposed to corporate welfare. The Center has helped kill off several of these ineffective programs over the years, something not many other states can brag about.

And then there’s our educational outreach. On behalf of Michigan voters, we’ve described in plain English every bill that’s been introduced since 2001 — more than 25,000 of them — on our website MichiganVotes.org and now through our app, Votespotter. And we’ve provided similar easy-to-understand explanations of dozens of ballot proposals to help Michigan voters make better-informed decisions at the ballot box.

Even as we celebrate our success over the years, we remain focused on the future. Optimists seem in short supply, but we’re continually inspired by our vision of a better Michigan. Looking out at the next 30 years, when Michigan is a freer and more prosperous state, what will have happened?

Michigan will maximize human capital, eliminating obstacles to attracting and developing talented people and entrepreneurs. The state’s business environment will encourage innovation by leveling barriers to work and regulatory drags on productivity. Tax policy will be a fair field with no favors.

Local governments will have eliminated the long-term liabilities of unfunded pensions and retiree health costs that would have overwhelmed future taxpayers. The default compassionate safety nets will be organized and driven by civil society and private philanthropy rather than state-run programs. Education will look less like a factory assembly line and more like Pandora, Uber or Netflix — customized for the individual user.

But we couldn’t achieve this vision alone. Key partners made the Mackinac Center’s success possible and we expect to continue and expand those types of partnerships in the years to come. We want to thank our donors and board members for their generosity, farsightedness and commitment to the principles of freedom, as well as our partners and allies throughout the State Policy Network, who come together to make a coalition stronger and more effective than any single organization could be.

In the 1980s, there were few organizations in Michigan talking about the benefits of free markets. We’re proud of having contributed to making Michigan a freer and more prosperous state over these last 30 years, and we look forward with cheer to the next 30.

Joseph Lehman is the President of the Mackinac Center for Public Policy. Michael Reitz is the Executive Vice President of the Mackinac Center.


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This article was originally published by the Institute for Justice. To see more Michigan-specific work on forfeiture, please visit www.mackinac.org/forfeiture.

Crime doesn’t pay, but being innocent in the wrong place can cost you big time under Michigan’s civil forfeiture laws. The sheriff’s department of Oakland County, Michigan (in suburban Detroit) froze more than $10,000 in the bank account David Barnes shared with his mother after a November 2014 raid on a building their family owned. Officials allegedly thought a company operating inside the building was involved in drug trafficking. According to ABC 7 Detroit, all charges later filed against Barnes were dropped. But through civil forfeiture, the department continued to freeze his bank account.

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Under civil forfeiture, law enforcement can seize property — or freeze private bank accounts — when they have reason to believe the property is tied to wrongdoings. Prosecutors can then forfeit the property (through litigation which legally transfers ownership to the government) even if they don’t charge the property owner with, let alone convict him of, a crime. Although a judge ordered Oakland County law enforcement to unfreeze Barnes’ bank account in February 2016, Barnes’ attorney believes officials intentionally ignored the order for months, resulting in multiple hearings and a court appearance. Barnes didn’t get his account back until last week— 22 months after the judge initially ordered the return of his property.

Unfortunately, Barnes is not the only Michigander to run afoul of abusive forfeiture laws. In 2013, the federal government used civil forfeiture to seize more than $35,000 from Terry Dehkos’ grocery store bank account and more than $70,000 from Mark Zaniewski’s independently owned gas station, even though neither had done anything wrong. The government eventually returned the money, following nearly a year of litigation, after the business owners teamed up with the Institute for Justice to fight back.

According to IJ’s “Policing for Profit” report, the Wolverine State earns a D- for its civil forfeiture laws because of its allowance for forfeiture without a criminal conviction, poor protections for innocent owners whose property was allegedly involved in a crime without their knowledge or consent, and allowing law enforcement agencies to keep as much as 100 percent of forfeiture proceeds. This broken system encourages police to treat citizens like ATMs; from 2001 to 2013, law enforcement pocketed more than $244 million from forfeiture proceedings that have ensnared innocent people like Barnes, Dehkos and Zaniewski.

Earlier this year, Michigan Gov. Rick Snyder signed HB 4629, which eliminated a requirement that property owners pay a cash bond of up to $5,000 before they can challenge a civil forfeiture case in court. Although a good first step, lawmakers should do more to protect innocent people’s property rights. Potential improvements include repealing civil forfeiture and replacing it with criminal forfeiture, in which the judge and jury that found a suspect guilty of a crime would also determine whether the defendant’s property should be forfeited because of that crime. Lawmakers should also eliminate the policing for profit motive by transferring all forfeiture proceeds to the state general fund instead of the seizing agency’s coffers.

Michigan should also ensure its law enforcement cannot circumvent future reform by colluding with federal agents, as often happens across the country. Under the U.S. Department of Justice’s equitable sharing program, local police can outsource the court battles over property they seize under Michigan law to federal agencies litigating under federal law. This bait-and-switch enables the federal government to kick back nearly 80 percent of forfeiture proceeds to the state agencies that made the seizure. Between 2000 and 2013, Michigan agencies pocketed more than $127 million this way. Lawmakers can close a portion of this loophole by requiring the use of Michigan’s forfeiture law when state and local agencies make stops and seizures under state law.

Fourteen states require a criminal conviction in most or all forfeiture cases. Nebraska, North Carolina and New Mexico abolished civil forfeiture entirely and enacted criminal forfeiture. These three states provide Michigan legislators with a model to follow.


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December 15, 2017 MichiganVotes weekly roll call report

Senate Bill 702, Ban school districts and local governments from discriminating against charter schools: Passed 26 to 11 in the Senate

To expand the definition of “deed restriction” in a 2017 law that prohibits a school district or local government from refusing to sell property to a charter or private school, or from taking other actions designed to keep these potential conventional public school competitors from using property for a lawful educational purpose. The bill would close loopholes that cities and school districts have used to discriminate against charter schools.

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Who Voted "Yes" and Who Voted "No"


Senate Bill 469, Give some developers subsidies for rehabbing “historic” structures: Passed 36 to 2 in the Senate

To grant certain developers approved by state or local officials credits against the business income tax that are worth up to 25 percent of the amount spent to restore a structure that meets various criteria for being “historic.” Up to 90 percent of credits valued up to $250,000 would be "refundable," making them virtual cash subsidies.

Who Voted "Yes" and Who Voted "No"


House Bill 4207, Subsidize grocery stores in cities: Passed 33 to 4 in the Senate

To authorize state subsidies for grocery stores in urban areas. This would come from money earmarked to an existing business subsidy program, and is estimated to be around $1 million to $2 million annually. The money could not be given to the owner of a grocery store located within a mile of an existing store.

Who Voted "Yes" and Who Voted "No"


House Bill 5165, Revise unemployment insurance rules to avoid impostors and fraud: Passed 38 to 0 in the Senate

To revise state unemployment insurance rules and procedures to address the problem of impostors claiming and getting unemployment benefits. This is part of package comprised of House Bills 5165 to 5172 that among other things would facilitate reporting by employers and individuals that a particular claim is fraudulent; cancel benefits on those claims and not assess employers for them; reduce penalties and let some recipients keep improper payments; and more. The legislation was introduced after it was reported that an automated system wrongly determined that thousands of individuals filed fraudulent claims, and with this week’s votes goes to the Governor for approval, which is expected.

Who Voted "Yes" and Who Voted "No"


House Bill 4320, Spend more for environmental cleanups, borrow more for colleges: Passed 33 to 4 in the Senate

To appropriate $52.8 million for various state departments and functions in the current fiscal year, including $23.2 million for remediation activities related to recently reported instances of groundwater contamination by a chemical called perfluoroalkyl. The bill also authorizes $74.6 million in new long term debt for state university and college construction projects and $57 million for a State Police construction project.

Who Voted "Yes" and Who Voted "No"


House Bill 4320, Spend more for environmental cleanups, borrow more for colleges: Passed 109 to 1 in the House

This is the same bill as the one above that passed the Senate.

Who Voted "Yes" and Who Voted "No"


Senate Bill 167, Expand opioid prescription restrictions and reporting: Passed 83 to 27 in the House

To require a doctor to have a “bona fide prescriber-patient relationship” before prescribing opioid and other painkillers that are subject to abuse, and authorize sanctions on a doctor who fails to first check the patient’s prescription record on a state database that collects this information before prescribing.

Who Voted "Yes" and Who Voted "No"


Senate Bill 274, Restrict opioid prescription quantities: Passed 97 to 13 in the House

To restrict the amount of opioid pain pills a doctor may prescribe for acute pain to a seven day supply. The bill would also allow pharmacists to issue a smaller supply of painkillers to patients with longer prescriptions for chronic pain if requested by the patient.

Who Voted "Yes" and Who Voted "No"


Senate Bill 478, Ban drivers license renewal if three unpaid parking tickets: Passed 74 to 36 in the House

To repeal the Jan. 1, 2018 sunset on a 2014 law that reduced from six to three the number of unpaid parking tickets a person can have before the Secretary of State will not renew a drivers license until the tickets are paid along with a $45 "clearance" fee. The bill would leave the more stringent regime in place permanently.

Who Voted "Yes" and Who Voted "No"


SOURCE: MichiganVotes.org, a free, non-partisan website created by the Mackinac Center for Public Policy, providing concise, non-partisan, plain-English descriptions of every bill and vote in the Michigan House and Senate. Please visit www.MichiganVotes.org.


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