Mackinac Center President Joseph Lehman will serve as a panelist at the Mackinac Policy Conference Friday, May 29, at 9:00am.
The topic is "Michigan's Road Fix—the $1.5 Billion Question."
Lehman will join Westland Mayor William Wild, Edw. C. Levy Co. COO S. Evan Weiner, Citizens Research Council of Michigan President Eric Lupher and ITC Holdings Corp. Vice President of Business Unit FInance and Rates Gregory Ioanidis.
By Jack McHugh
As part of the negotiations to get Proposal 1 on the May 5 ballot, Gov. Rick Snyder reportedly promised to veto a potential repeal of the state's “prevailing wage” law. This law prohibits awarding government construction contracts to the lowest bidder, unless the contractor pays the equivalent of union wages that often exceed market rates. Studies have shown that this adds hundreds of millions of dollars annually to the cost of government infrastructure projects, including school construction and road repairs.
Michigan’s closed state employee pension system got some good news this year: unfunded liabilities did not increase. But taxpayers are still on the hook for the $6.2 billion promised to retirees that the state has failed to save enough for.
A new valuation shows the system’s liabilities grew roughly $500 million since the last report — but so did the value of assets set aside to cover those liabilities. The state carries $16.2 billion in pension liabilities, and $10.0 billion of investments. Some of the system’s previous assumptions have been updated to reflect actual experience, which added $400 million to the projected liabilities.
The United Way has released a report that says the vast majority of Michigan residents need a lot more money in order to be financially “stable.” The study has received wide media attention (sample headline: “More than 1.5 million Michigan households struggling”), but the claims paint a distorted picture.
Since 2009, the unemployment rate in Michigan has dropped faster than any other state in the country.
It has gone from 14.9 percent to 5.4 percent from June 2009 to April 2015.
Assistant Director for Fiscal Policy James Hohman put the numbers in perspective on the Frank Beckmann Show.
Now with one click you can approve or disapprove of key votes by your legislators using the VoteSpotter smart phone app. Visit Votespotter.com and download VoteSpotter today!
Senate Bill 103, Reduce “student growth” portion of teacher rating criteria: Passed 22 to 15 in the Senate
A Mackinac Center/Michigan Chamber of Commerce poll, showing overwhelming support to redirect film subsidies to roads, was highlighted by WJR's Frank Beckmann May 21.
The poll, conducted by Mitchell Research and Communications, shows 66 percent of respondents supported the idea of using the $50 million in annual film subsidies to fix the roads.
This week Gov. Rick Snyder released a broad, ambitious plan for criminal justice reform, seeking to enhance public safety while improving effective policing and the management of the state’s corrections efforts, including the Michigan Department of Corrections. Several of his recommendations draw from Mackinac Center research, including this section of his address, which discussed overcriminalization:
The Mackinac Center's May 20 event "Civil Asset Forfeiture: How Government Private Property from Innocent Citizens" attracted a panel and a crowd of various idiologies.
The panel included Lee McGrath, an attorney with the public interest law firm Institute for Justice, Democrat State Representative Jeff Irwin and ACLU of Michigan Attorney Dan Korobkin.
As Michigan continues its economic recovery that has led to more jobs, higher real estate values and more government tax revenue, one might wonder what’s driving the state’s recent economic growth. Some point to the booming auto industry, praising the bailouts and speedy bankruptcies. Yet, while some pieces of the state economy are improving more than others, it’s all of them together that makes the difference.
In a recent Mlive column, Tim Skubick says critics of the House Republican road funding plan think it violates accounting principles. “If you are a respectable bean-counter you are loathed to predicate any budget on revenue that may or may not materialize,” he writes.
Schools of Choice research conducted by Mackinac Center Director of Education Policy Audrey Spalding is cited in a WILX report.
More than 80 percent of Michigan's school districts are accepting students into their boundaries. More than 100,000 Michigan students use Schools of Choice, which is comparable to those students attending charter schools.
Targeted tax breaks are justified as a means to spur investment and growth, but they are often just a way for well-connected firms to gain a tax break while other businesses are forced to carry the remaining burden.
The Mackinac Center's targeted tax break opinion was recently noted on Vox.com in an article about the difficulties small businesses often have in the wake of tax breaks targeted toward bigger businesses.
Right now in Michigan the government can take the personal property of private citizens even if the citizen has not been charged with a crime. It's called civil asset forfeiture, and it's the topic of a Mackinac Center Issues and Ideas forum.
Lee McGrath, Institute for Justice legislative counsel and managing attorney of the Minnesota office, served as a guest on the Frank Beckmann Show on WJR 760AM Tuesday morning.
On May 5, Michigan voters rejected proposal one by a historic 80-20 margin. The proposal would have raised taxes on sales, gas, and vehicle registration, mostly to fund road repair.
Heartland quoted James Hohman, a fiscal policy analyst at the Mackinac Center, to explain the proposal and give some insight into why it failed.
For two decades the Mackinac Center for Public Policy has recommended repealing the state’s prevailing wage law. It is an expensive mandate that artificially raises the cost of state-funded construction projects. Bills to make prevailing wage an artifact of history have been adopted by the state Senate.
Michigan once had the most generous film incentive program in the nation, but economic realities caused legislators to trim back these subsidies. Recently, the state House voted to end the $50 million program altogether.
Policy Analyst Jarrett Skorup was on NPR’s “All Things Considered” to discuss state film incentives. He said work from independent economists show that this is one of the worst things state governments can spend taxpayer money on.
Now with one click you can approve or disapprove of key votes by your legislators using the VoteSpotter smart phone app. Visit Votespotter.com and download VoteSpotter today!
Senate Bill 3, Repeal “prevailing wage” law: Passed 22 to 15 in the Senate
To repeal the state “prevailing wage” law, which prohibits awarding government contracts to contractors who submit the lowest bid unless the contractor pays wages based on pay scales that local union officials represent as prevalent in a particular area, but which tend to be above the market rate. Senate Bill 1 would repeal the law for schools, and passed by the same margin. The Senate added a modest appropriation, which has the effect of making the bill not subject to a referendum.
The House Republicans recently released a proposal that would dedicate an extra $1 billion annually to roads by 2019. A chunk of the extra money comes from redirecting money from the Michigan Economic Development Corporation to the state’s transportation infrastructure.
The Detroit News calls the proposed House Republican roads plan “fantasy” because it provides additional road funding from future tax revenue growth. The plan, an editorial states, calls for finding money “out of thin air.”
Michigan is already operating on increased revenue from recent growth. The state budget spends $3.5 billion more state tax dollars than it did in fiscal year 2011.
Last year, Michigan passed a bill that effectively prohibited the direct sale of automobiles. Caving to pressure from existing car dealerships, the state now makes it difficult to impossible for new car manufacturers, such as Tesla Motors, to gain a foothold in the state’s automobile market. As advocates of free markets and fair competition, the Mackinac Center signed on to a public letter earlier this year calling for the Michigan Legislature to reconsider this anti-competitive measure.
The 80-20 loss on a $2 billion tax hike will guide subsequent road funding proposals; there is no shortage of interpretations (some odder than others) of the message voters intended to send. Some assert that voters will not approve complex proposals and suggest other tax hikes. The new House proposal, on the other hand, indicates that the proper message is to first look within the state government’s current resources to fix the roads.
Last month, the Michigan House Tax Policy committee heard testimony about the state’s economic incentive programs. The usual justification for giving selective favors to particular firms was trotted out: Other states will capture these projects if this state does not distribute taxpayer cash to companies and developers. Without special incentives, proponents argue, Michigan is doomed to fall behind.
In the May 12 edition of the Detroit News, Policy Analyst Jarrett Skorup and Assistant Director of Fiscal Policy James Hohman propose ideas of how Michigan taxpayers can fund the state's roads.
In their suggestions, most of the revenue comes tax-funded projects that offer little to no value to the average Michigan taxpayer.
Currently, the Michigan Constitution requires the state to use a flat income tax, where everyone pays the same percentage (4.25) of their income. But some want to scrape this and allow state legislators to set different rates for different people.
A recent poll from EPIC-MRA ostensibly suggests there’s support for a graduated income tax among Michiganders, with 66 percent favoring the concept. At their convention last weekend, Michigan Democrats proposed a constitutional amendment that would enable the Legislature to create a progressive income tax. Over the years, similar bills have been introduced on the issue.
