Governmental Consultant Services, Inc.
1 20 N. Washington Square, Lansing, Michigan 48933
GCSI Phone: 517-484-6216 Fax: 517-484-0140
TO: Michigan Library Association Legislative Committee
FROM: Nell Kuhnmuench and Gary E. Owen
DATE: October 1st, 2012
RE: Legislative Briefing
As you know all members of the Michigan State House of Representatives, the United States House
of Representatives and various members of the United States Senate (including Michigan Senator
Debbie Stabenow) are up for re-election in November of 2012. You should be aware that GCSI has
been monitoring all races very closely on behalf of MLA.
The legislature recessed on September 27th and will return for one day of voting on October 17th
before the election. In November, the legislature is planning to return on November 8th (two days
after the November 6th election). The legislature will take their normal recess for deer hunting and
thanksgiving starting on November 12th. They will return for the final week of November and the
first three weeks of December for a “lame-duck” session. Currently Republicans enjoy a 26-12
majority in the Senate, a 64-46 majority in the House and occupy the Executive office with
Governor Snyder. With only the House up for reelection, if Republicans are able to retain control,
we expect a very tame lame duck session as they will be able to continue business as usual in the
2013-14 session when members return in January.
Personal Property Tax reform
The Snyder Administration is leading the charge to reform the Personal Property Tax on
commercial (up to a certain threshold) and industrial property collected in Michigan. The tax
generates approximately $1 billion in revenues for local governments.
The MI Senate passed a package of bills in the spring of 2012 (SB 1065-1072) that now sit in the
House Tax Policy Committee Chaired by Rep. Jud Gilbert. GCSI and MLA have had several
conversations with Rep. Gilbert and House leadership about the plan forward on PPT reform.
Leadership in the House has been clear since the beginning that they would not take the package up
before the November election. With the election one month away, discussions are starting to take
place about what the PPT reform package will look like and whether the House will take action.
MLA and GCSI have been working closely with the Replace, Don’t Erase coalition which has
called for a constitutional amendment to guarantee replacement revenue. We have made it clear
that the MLA is opposed to the bills without a guarantee for replacement, which by all indications
including the Senate Fiscal analysis below, these bills do not accomplish.
SB -1167 (Meekhof)
The bill amends the Home Rule Village Act. The bill pertains to the disincorporation of a village
and the procedure for doing so. However, the bill has unintended implications for district
libraries.MLA and GCSI are currently working with Senator Meekhof and Rep Ouimet to address
Under the District Library Establishment Act (MCL 397.171), two or more participating
municipalities are required for a District Library to be legally established. The Act does allow for
single municipality district libraries and provides for withdrawal of a municipality. It requires that a
withdrawing municipality must still honor its debt obligations and a district-wide tax still gets
collected. However, there is no provision that anticipates either disincorporation or consolidation of
a village, township or city that would result in a legally established District Library having one
participating municipality, therefore clarification is in order.
MLA and GCSI have submitted a request for an amendment to both the Sponsor of the bill and
ChairmanOuimet’s office for their consideration. However, it will be necessary to amend the
District Library Establishment Act if MLA wants to fix this problem in statute. Therefore GCSI
and MLA plan to meet with Rep Joel Johnson, who has introduced HB5884, which is the only bill
introduced thus far this session that amends the DLEA. We hope to explore with Rep Johnson the
ability to use that bill and amend the act as necessary, and run it alongside of SB 1167. Obviously
there are a lot of moving pieces here so GCSI will make sure to keep you apprised as we move
HB 5884 (Johnson)
As mentioned above, GCSI and MLA plan to meet with Rep Johnson in the near future and discuss
whether he is willing to allow MLA to use this bill as a vehicle to amend the District Library
Establishment Act. With regards to the bill, it was introduced per the request of a constituent and
he does not plan to move the bill this session. We will make sure to update you after this meeting.
HB 5598 (Zorn)
This is a bill that would allow for the Counties to adopt the Michigan Motor Vehicle Code.
Currently Cities, Townships, and Villages are authorized to adopt the Motor Vehicle Code, however
Counties were left out when the original act was passed. The Deputy Sheriff’s Association believe
this is a discriminatory act and needs to be amended to include Counties. MLA has discussed this
bill among its members and with key legislators and remains opposed to this bill. It has been
referred to the House Local, Intergovernmental, and Regional Affairs committee, chaired by
Representative Mark Ouimet.
SB 1330 (Jones)
This bill was introduced on Thursday, September 27th and is the Senate “twin” of HB5598. GCSI
and MLA plan to meet with Senator Jones in the near future about the implications of the bill. The
bill has been referred to Senate Transportation Committee chaired by Senator Tom Casperson.
FY 2013-2014 Budget cycle
GCSI and MLA have begun discussions with the Snyder administration about budget development
for the 2013-2014 budget that will be proposed in February. Our first meeting was with John Nixon,
Director of the Department of Technology, Management and Budget and State Budget Director.
The meeting was a positive one as the Director mentioned his affinity for libraries and specifically
for MeL. With around $6 million in new funding from the state for Libraries last cycle, our story
and methods are working. Last year was a huge success for MLA within the state appropriations
process and we will use that momentum to continue to advocate for enhanced funding across the
As we get closer to the end of the year, we will begin to sit down with key members of the
legislature and administration. The current chair of the House Appropriations Committee,
Rep.Chuck Moss is term limited. When House leadership races are decided after the election and
committee chairs are named, GCSI and MLA will mobilize quickly and meet with the various
chairs and targeted members of the following committees:
House and Senate Appropriations,
House and Senate Subcommittees on Education and K-12/School Aid
House and Senate General Government committees.
Library funding shows up in the state budget in a variety of areas within the budget bills and
can be confusing. Please see below a refresher on the FY 2012-2013 budget that was adopted
earlier this year and started on October 1st, 2012.
Department of Education budget
Michigan Electronic Library (MeL) Database
FY 11-12 year to date is $950,000
The Executive recommendation provides additional $800,000 GF/GP for the Library of Michigan,
to support the library's acquisition of business databases and other online resource programs for
small businesses and entrepreneurs.
House concurs with Executive.
Senate concurs with Executive.
Conference concurs with Executive and provides for $800,000 of new money for the Michigan
e-Library (MeL) database!!!!
Total appropriation for MeL is now $1,750,000
State Aid to Libraries
FY 11-12 year to date is $5,445,700
Executive: Makes no increase or decrease in recommendation.
House: Increases by $470,700
Senate: Concurs with Executive and makes no increase.
Conference concurs with House and provides an additional $291,600
This results in $762,300 of new money for State Aid to Libraries!!!!!
Total State Aid to Libraries provided by the Dept. of Education budget is $6,208,000
K-12 School Aid Budget
Renaissance Zone Reimbursements (Sec. 26a)
FY 11-12 year to date is $0
- Executive recommends no increase or decrease
- House concurs with Executive on reimbursements to school districts and ISDs, and also
provides $3.0 million GF/GP to reimburse libraries.
- Senate concurs with Executive.
- Conference concurs with the Executive on reimbursements to school districts (no change
from FY 2011-12 YTD), but provides $1.5 million to reimburse libraries.
- Libraries will now enjoy a $1.5 million dollar increase of new money for Renaissance
- Total appropriation for Renaissance Zone Reimbursements for libraries is $1,500,000
State Aid to Libraries
FY 11-12 year to date $1,304,200
- Executive recommends no increase or decrease.
- House concurs
- Senate Concurs
- Conference Concurs.
- This line item was held whole and in the K-12 budget, libraries enjoy $1,304,200 in
State Aid to Libraries!
Department of Treasury Budget
Renaissance Reimbursements to Community Colleges
- Executive recommends no increase or decrease
- House concurs
- Senate concurs
- Conference provides $3,500,000 in Renaissance Zone Reimbursements!
Total Funding for libraries in the FY – 12-13 Budget
- State Aid to Libraries
o Department of Education Budget - $6,208,000 ($762,300 of new money)
o K-12 Budget - $1,304,000 ($0 of new money)
- Renaissance Zone Reimbursements to libraries - $1,500,000 ($1,500,00 of new money)
- Renaissance Zone Reimbursements to Community Colleges - $3,500,000 ($3,500,00 of new
- Michigan e-Library (MeL Database) - $1,750,000 ($800,000 of new money)
- Total new money = $6,562,300
2011 Bill Introductions:
The following bills of interest have been introduced:
House Bill 4001: MBT Surcharge Repeal.
House Bill 4038 – 4041: Unfunded Mandates.
House Bill 4046: MBT Surcharge Phase-out.
House Bill 4047: MBT Repeal.
House Bill 4048: General Property Tax exclusion for new construction, residential development
House Bill 4084: Downtown Development Authority local agriculture and farmer’s markets.
House Bill 4091: MBT Gross Receipts modification.
House Bill 4098: Michigan business tax; surcharge; surcharge tax; repeal.
House Bill 4099: Sales tax; other; sales tax on services; implement. TIE BAR WITH: HB 4100'11,
House Bill 4100: Use tax; other; application of use tax to certain services; provide for.
House Bill 4101: Michigan business tax; gross receipts; tax rate on modified gross receipts; reduce.
House Bill 4102: Property tax; personal property; personal property tax; eliminate. TIE BAR
WITH: HB 4103'11
House Bill 4103: Property tax; other; specific tax on exempted personal property; create. TIE BAR
WITH: HB 4102'11
House Bill 4104: Property tax; personal property; alternative energy personal property; exempt
from personal property specific tax. TIE BAR WITH: HB 4103'11
House Bill 4105: Property tax; personal property; personal property tax; eliminate. TIE BAR
WITH: HB 4103'11
House Bill 5598: Counties; ordinances; uniform traffic code; authorize counties to adopt. Amends
title &secs. 1, 2, 3, 4 & 5 of 1956 PA 62 (MCL 257.951 et seq.).
House Joint Resolution F: Sales tax; rate; lowering sales and use tax rate and applying sales tax to
services; amend constitution to provide for.
Senate Bill 001: Michigan business tax; repeal; Michigan business tax; repeal.
Senate Bill 006: Michigan business tax; surcharge; surcharge for taxpayers other than financial