December 4, 1998

Legislative & Political Week in Review

• Like shopping days ‘til Christmas, the available session days before legislators adjourn sine die are dwindling quickly, and lawmakers are struggling to cross off the three big items on their shopping list: electric deregulation, local revenue sharing, and a casino compact with state Indian tribes. (NOTE: The last issue of Roundup before adjournment probably will be December 11, with weekly publication resuming on January 21.)
• A meeting this week among Detroit’s mayor, Michigan’s governor, and legislative leaders yielded a comprise revenue sharing plan that subsequently passed the House 58-33. With the growing political prominence of Kent and Ottawa counties, legislative unease with the current split of sales tax receipts—26 percent now goes to Detroit, a city accounting for 10 percent of the state’s population—has steadily mounted. Under HBs 5391 and 5989, which are tie-barred, the City of Detroit’s income tax will drop from three to two percent, while state revenue sharing payments will remain frozen at current levels through fiscal 2007–08. During this same period, the formula for distributing some $1.4 billion in aid statewide will shift from a system favoring high municipal tax burden to one based on population. The revenue loss for Michigan’s largest city under this compromise is substantial—estimated at $120 million over 10 years—but significantly less than that proposed under SB 1181, passed earlier in the year by the Senate, which immediately would have carved $100 million out of Detroit’s share.
• With several polls suggesting that voters are measurably less interested in electric deregulation than are their legislators, lawmakers’ eleventh-hour surge to pass bills permitting Michiganians to shop around for electric power providers dimmed measurably this week with passage in the upper chamber of substitute SB 1340. The bill gives the force of law to regulations already promulgated by the Public Service Commission and stops well short of reforms championed by the governor and major state utilities. The complex topic has defied bipartisan resolution, and the bill’s fate in the House and mandatory adjournment may yet pull the plug on this issue for the time being.
• Questions around casino gambling involve form as well as function, with House members debating whether to vote on HCR 115 or HB 5872. The former affirms three-year-old gubernatorially negotiated casino compacts with four newly recognized Indian tribes, while the latter essentially approves the same provisions but with additional limitations on casino operations. Although seven earlier gaming compacts were approved by legislative resolution, the attorney general has ruled since that any new compacts must be approved by a bill.
• The halls of justice will be more than a metaphor in Lansing upon enactment of SB 906, passed in the Senate this week, providing about $88 million for a new facility that will house the state supreme and appeals courts under one roof. The authorization is included in the $160-million capital outlay budget, the final piece of the FY 1998–99 budget to receive legislative action. Following a 24-11 vote for passage in the upper chamber, the measure headed to the House for concurrence.
• In an appointment underscoring the monolithic partisan complexion of the new legislature, Governor Engler’s director of state government affairs has moved from the executive to the legislative branch, to serve as chief of staff for incoming House Speaker Chuck Perricone (R-Kalamazoo): Manny Lentine, a former House policy analyst, will assume his duties as Perricone’s top aide on January 1.
• Meanwhile, a distinctly bipartisan complexion will mark next week’s retirement dinner tribute to Michigan’s "eternal general," outgoing Attorney General Frank Kelley. The Dearborn gala—the proceeds from which will help fund a chair endowed in Kelley’s name at the Detroit College of Law at Michigan State University—will mark the first time in John Engler’s governorship that he will have appeared publicly with ex-guvs William Milliken and James Blanchard.