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					Michigan Manufacturers Association
About MMA

    The Michigan Manufacturers Association (MMA)
is the state’s leading advocate exclusively devoted to
promoting and maintaining a business climate favorable
to industry. MMA’s goal is to make it possible for
Michigan manufacturers to successfully compete in
the national, and international, marketplace.
    Through effective representation of its membership
before the legislative, executive and judicial branches of
government on issues of importance to the manufacturing
community, MMA works to foster a strong and expanding
manufacturing base in Michigan.                                        An elected Board of Directors oversees MMA’s business
    Established in 1902 as a voluntary membership association      affairs (see complete board listing below). James M. Nicholson,
and incorporated in 1923, MMA represents the interests and         of PVS Chemicals, Inc., currently serves as chairman of the Board.
needs of nearly 3,000 members, ranging from small manufacturing        The Association and its for-profit subsidiary, the MMA
companies to some of the world’s largest corporations. In fact,    Service Corporation (MMASC), collectively employ 25
manufacturers who are members of MMA employ more                   full-time staff members. Charles E. “Chuck” Hadden serves
than 90 percent of Michigan’s industrial workforce.                as president and CEO of the MMA.

MMA Board of Directors
Officers                                      Directors
Chairman                                      Cynthia A. Alt               Timothy Knowlton               Bryan R. Roosa
James M. Nicholson                            Agapé Plastics, Inc          Kellogg Company                General Motors Public
PVS Chemicals, Inc.                                                                                       Policy Center
                                              Thomas F. Catania     Harry A. Lomason, II
Vice-Chairman                                 Whirlpool Corporation Lomason Investments                   Sharon J. Rothwell
John G. Smith                                                                                             Masco Corporation
ROSS Controls, Inc.                           Richard F. Dauch             Richard A. Lund
                                              Acument Global               Jedco, Inc.                    Richard F. Russell
President and CEO                             Technologies, Inc.                                          Amerisure Companies
Chuck Hadden                                                               Ziad Ojakli
Michigan Manufacturers Association            David J. Dupre               Ford Motor Company             David H. Walborn
                                              The Dow Chemical                                            Resource Recovery
Executive Vice President and COO              Company                      Peter J. Pestillo              Corporation of West
John J. Trobec                                                             Visteon Corporation            Michigan (Ret.)
Michigan Manufacturers Association            David W. Joos                (Ret.)
                                              CMS Energy and                                              Peter S. Walters
Treasurer                                     Consumers Energy                                            Guardian Industries
Daniel R. Lockman                                                                                         Corp.
Deloitte & Touche LLP

Secretary and General Counsel
                                                   MMA has represented the needs and interests of
Duane L. Tarnacki
Clark Hill PLC                                     Michigan manufacturers for more than 100 years.
We Can Build a Better Michigan
    Michigan’s economic policy has failed to attract and
retain enough investment to bolster the state’s economy or
support the current cost of state government. The challenges
we face cannot be addressed with incremental steps. Michigan
needs both dramatic structural spending and economic policy
reform to create jobs and grow the Michigan economy.
    The fact that Michigan leads the nation in unemployment,
and has for most of the last decade, demonstrates the state’s
dire economic situation. According to the Bureau of Labor
Statistics, Michigan has lost a total of 849,646 jobs since
September of 2000. As the economy fails to attract investment,
state revenues have plummeted, dropping by more than $2.8
billion, or 12.4 percent, between 2008 and 2009.
    The challenges presented by these staggering losses are
daunting. Soon after the Legislature enacted a cut-based
budget which reduced state spending by 10 percent for 2010                Michigan also needs dramatic economic policy reform to
in November of 2009, Governor Granholm called on state                 end the cycle of disinvestment. We are putting forth this
agencies to plan for 20 percent cuts in 2011. At about the             agenda for Michigan to accomplish both goals and put
same time, State Budget Director Emerson projected a $1.4              Michigan on the right track to job growth and prosperity. It
billion dollar hole in the 2011 budget.                                will take courage and fortitude, but we are calling on
    Budget cuts, while necessary, are not fundamental reform.          policymakers to join us in facing these challenges head on.
To address the catastrophic decline in revenue, state government       Together, we can build a better Michigan.
must make dramatic fundamental structural spending reforms.
Michigan needs to consolidate schools, consolidate local
units of government, come in line with national averages for
state employee wages and benefits and eliminate programs it                                         Chuck Hadden
can no longer afford to operate — especially those that                                             MMA President and CEO
exceed federal requirements and decrease the state’s ability to
attract jobs and investment compared to other states.

MMA Advocacy Team

Chuck Hadden                    Mike Johnston                      Randy Gross                        Jennifer Spike
President & CEO                 Vice President,                    Director, Environmental            Director, Human
517-487-8550                    Government Affairs                 & Regulatory Policy                Resource Policy              517-487-8554                       517-487-8543                       517-487-8530

The MMA government affairs staff protects the needs and interests of industry by advocating pro-manufacturing policies
with legislative and government officials. They represent the collective voice of the MMA membership in the fight against
unnecessary and burdensome legislation and regulations to improve the business climate for manufacturers in Michigan.

                                          2010 Structural and Economic Reform Agenda for Michigan                                     3
    Structural Spending Reform
    Over the past few years, economic experts have advised policymakers about the ominous challenges
    facing the state and provided a variety of potential solutions. To date, the state’s staggering budget
    challenges have been met almost exclusively by budget cuts. MMA believes that it is now time to
    implement fundamental reforms to address the chronic structural deficit, improve competitiveness
    and streamline government.

    Specific Policy Reform Goals:

    There are no single silver bullets, because there are multiple          • Pool all health care plans for public employees.
    barriers to cost reductions built into the structure of government.     • Reform Public Act 312 to change arbitration standards for
    The continually increasing cost of government is embedded                 police and fire.
    in policies and structures that are no longer sustainable. We
    must fundamentally change the cost structures of local units of         • Reform Urban Cooperation to eliminate the requirement that
    government and schools to consolidate service delivery                    when a service merger occurs, the higher wage and benefits
    systems and reduce costs. For example, school administrative              must be paid, blocking savings in consolidation of local units.
    services should be done more by the Intermediate School                 • Require all new teachers hired by a date certain in the
    Districts rather than duplicated by schools. The Urban                    future to have defined contribution, rather than defined
    Cooperation Act shouldn’t create barriers to savings through              benefit, retirement plans.
    consolidation. Local units shouldn’t be hindered from                   • Require school employees to pay 25 percent of their
    controlling costs in contract discussions for police and fire             health insurance costs.
    services, and pooling public health care plans should be
    explored for cost savings. We must change policies that create          • Move all administrative functions of local schools to the
    barriers to better control public employee compensation and               Intermediate School District, reducing administrative
    benefits to available public revenues. We should not be                   duplication in the school service delivery system.
    spending more on the corrections system than we are spending            • Incentivize the consolidation of school districts through
    on the higher education system. There are multitudes of                   the School Aid Fund.
    similar examples of structural barriers to cost savings in state
                                                                            • Privatize food service, mental health services and
    government. MMA is partnering with the business community
                                                                              transportation in prisons.
    and other interested organizations in providing not only
    options for reform to policymakers, but also our support in             • Increase minimum retirement/years of service for all
    making the tough political decisions necessary to achieve cost            public employees to be eligible for retirement benefits.
    reductions and structural spending reform.                              • Increase state employee and retiree health care premium
    Thematically, throughout the 2010 MMA Legislative Agenda,
    we propose changes in policy that improve competitiveness
                                                                            • Eliminate duplication of the road patrol function of
    and streamline government. However, the following is a list of            Michigan State Police and county sheriffs.
    possible structural cost reforms that MMA, along with a broad           • Require that school districts competitively bid all non-core
    coalition from the business community, is calling on the                  functions, including transportation, food service and
    Legislature to pursue as a starting point for change:                     custodial work.
     • Require benchmarking analysis in all regulatory programs to          • Reduce mandatory minimum sentences and increase
       compare performance to other states (as proposed in SB 439).           parole rates for all crimes.
     • Require program efficiency studies in all government                 • Benchmark state employee compensation, setting a goal
       programs to eliminate waste.                                           below the national average.
     • Establish an Office of Medicaid Inspector General to                 • Eliminate undocumented and potentially fraudulent child
       specifically investigate Medicaid fraud.                               care payments.

4                                             2010 Structural and Economic Reform Agenda for Michigan
                         Economic Policy that Encourages
                 Manufacturing Investment and Job Growth
Our current state tax policy is completely backwards, taxing manufacturers disproportionately more
than the consumer side of the economy — unlike most other states. To be competitive, Michigan’s tax
policy must be reformed to reduce the effective tax rates on manufacturers to encourage industrial
capital investment and the high job multiplier effects inherent in the manufacturing sector.

Specific Policy Reform Goals:

Eliminate All Personal Property Taxes                                      surcharge itself, the Legislature also reduced the MBT
    We recognize that local units of government and schools                credits that were designed to reduce the disproportionate
depend upon revenue from property taxes. But we also                       burden the tax structure places on manufacturers and others
know that Michigan’s personal property tax stands out as a                 making investments in Michigan. These credit reductions
unique barrier to Michigan’s ability to attract and retain                 increased taxes on manufacturers by approximately $100
manufacturing investment and jobs as most states have                      million per year. In addition, the surcharge is applied
long since eliminated this tax. As we work to rid Michigan                 without the benefit of credits to offset the cost of the
of this outdated and uncompetitive tax, we are committed                   surcharge. Manufacturers who make significant investments
to working with local governments and other stakeholders                   in Michigan were forced to not only pay the full surcharge,
to find comprehensive solutions that define and address the                they were also saddled with significant tax increases as a
need for revenues to support essential local services.                     result of the credit reductions and limitations.
Michigan’s personal property tax is a significant barrier to               The MBT surcharge is a job killer. It must be eliminated, and credit
attracting manufacturing investment in Michigan and should                 reductions restored, to lessen the tax burden on manufacturers.
be eliminated.
                                                                           Reduce or Eliminate the Gross Receipts Tax Portion of MBT
Support Economic Development Programs                                          The gross receipts tax disproportionately taxes manufacturers
   Other states and countries are working aggressively to                  and should be changed or eliminated to allow Michigan to
lure away Michigan’s substantial industrial assets. They                   attract manufacturing investment and jobs. Manufacturing,
offer lucrative incentive packages that include upfront cash,              by its nature, tends to require large capital investment, but
land, facilities and job training. While some narrowly view                yields relatively low margins. In addition, the gross receipts
economic development efforts in terms of “tax expenditures,”               tax tends to tax manufacturing activities relatively more than
the revenue cost of not battling for jobs in this state is far greater     other business sectors because there is no deduction for
than the cost of essential incentives. Every manufacturing                 expenses such as labor, borrowing costs or expenses for the
job lost to another state or nation takes its substantial                  use of intellectual property — all of which are significant for
economic multiplier effect with it. Michigan cannot                        manufacturers. Placing relatively higher taxes on manufac-
unilaterally disarm in the battle for industrial investment.               turing makes it more expensive to produce products here on
Michigan must maintain an aggressive and inherently accountable            a comparative basis and, therefore, difficult to attract and
economic development program with incentives that are at least             retain future investment.
equal to, if not better than, those of other states and other countries.   The gross receipts tax must be changed or eliminated to make
                                                                           Michigan manufacturing costs competitive with other states
Eliminate the MBT Surcharge                                                and nations.
   To manufacturers in Michigan, the Michigan Business
Tax (MBT) surcharge imposes more than just an additional
22 percent tax burden. Manufacturers were particularly
hard-hit by enactment of the surcharge since, along with the

                                               2010 Structural and Economic Reform Agenda for Michigan                                            5
    Government Reform
    Becoming more economically competitive with other states and nations requires first measuring the factors
    that either drive or hinder economic growth. MMA believes the state should be run more like a business
    and that means working from performance-based data to set goals and measure progress toward those
    goals. State government must also institutionalize a system of benchmarking by putting it in statute.

    Specific Policy Reform Goals:
    Broad measures of output, like the unemployment rate,                • Performance of state government
    indicate clearly that Michigan is not competing effectively              ˏ Amount of regulation — including regulations that
    compared to competitor states and nations. But the state                   exceed federal standards
    must identify and track the underlying factors that drive
    investment and job creation in order to be successful in                 ˏ Permit issuance time for regulatory permits
    improving our competitiveness.                                           ˏ Predictability of permit issuance
                                                                             ˏ License processing times
    While many organizations and economists publish benchmarking
    reports, Michigan must institutionalize a system of benchmarks       • Several other factors also define
    that will direct administrative focus on the measures for              the business climate, including:
    competitive success and on Michigan’s business climate for               ˏ Transportation infrastructure
    manufacturers. The factors that should be considered include,            ˏ Energy costs
    at a minimum:
                                                                             ˏ Real estate costs
     • The effective tax rate for manufacturers compared to other            ˏ Support for R&D and talent attraction
       states, including both personal and real property taxes.
                                                                             ˏ Access to capital
     • Total business tax burdens on manufacturers, including:
                                                                             ˏ Availability of capital
        ˏ Personal property tax
                                                                        MMA calls on the Legislature to establish a system of measures
        ˏ Real property tax                                             and benchmarks in statute that requires the state to compare its
        ˏ Business income tax                                           performance to competitor states and nations. If we cannot
                                                                        measure our performance, we cannot identify ways to improve
        ˏ Gross receipts
                                                                        our performance. Establishing a statutory requirement for
        ˏ Corporate license taxes                                       benchmarking performance will force a business style approach
                                                                        to making state government become economically competitive.
        ˏ Regulatory fees
        ˏ Other state and local taxes
     • The cost structure of government
        ˏ Average salaries and benefits of state employees
        ˏ Average salaries and benefits of teachers
        ˏ Percentage of prison inmates 120 percent beyond
          minimum sentence

6                                          2010 Structural and Economic Reform Agenda for Michigan
                Employment and Workforce Policy
Labor costs, as well as an educated and highly skilled workforce, are important factors for succeeding
in today’s global economy. Proposals to increase employment costs and statutory wage obligations
jeopardize manufacturers’ ability to compete and discourage new investment in Michigan.

Specific Policy Reform Goals:
Block Cost Increases in Employer Financed                              Expand Choice in Education
Unemployment Insurance                                                     Charter schools provide options to those trapped by local
   Michigan’s Unemployment Insurance (UI) System is 100                failing schools and creates new opportunities for technical
percent employer-financed through payroll taxes, warranting            training needed in modern manufacturing. Positive steps
careful stewardship of its administration. Unemployment benefits       were taken to turn around failing schools through recent
are intended to be a temporary safety net for employees who            education reform measures aimed at competing for federal
find themselves without a job through no fault of their own.           Race to the Top dollars. Included in these reforms was an
MMA supports cost saving reforms that enhance the integrity of the     increase in the number of high quality charter schools.
UI system, such as prevention and identification of overpayments       However, this expansion is limited to low performing districts.
made due to fraud or mistake. MMA opposes expansion of                 MMA will work to ensure that choice is an option for all
eligibility requirements, raising benefit levels and extending the     children in Michigan through expansion of high quality
period of eligibility, especially during tough economic times          charter public schools statewide, rather than limiting choice
when insolvency of our state Unemployment Trust Fund is an             to under-performing school districts.
increasingly serious problem.
                                                                       Reform Teacher Tenure
Hold Workers’ Compensation Costs Down
                                                                           While gains were achieved in evaluating teacher performance
   While workers’ compensation provides important protection           in the Race to the Top Legislation at the end of 2009, more
for workers who are injured on the job, the program also               needs to be done to ensure the most effective teachers are teaching
represents a significant cost for Michigan employers and,              our future manufacturing talent.
therefore, must be managed both efficiently and effectively.           MMA will push for improvements in the tenure law to
Given the current economic climate, increasing workers’                ensure effective evaluation mechanisms and other tools are
compensation costs would put manufacturers at a competitive            in place, and used, to remove consistently poor performing
disadvantage.                                                          and ineffective teachers.
MMA adamantly opposes any effort to fund administration of the
workers’ compensation program through new fees on employers.           Oppose Federal Card Check Legislation
                                                                           The misnamed “Employee Free Choice Act” (EFCA)
Promote Quality and Efficiency                                         threatens our economic competitiveness by eliminating the
Throughout the Educational System                                      secret ballot for union representation. The legislation proposes
    Consolidation of school districts, privatization of non-           to replace the time-honored secret ballot with a “card check”
educational services, bulk purchasing cooperatives and better          system. It would also allow a federal arbitrator to dictate the
use of educational facilities as the center of community               terms of labor contracts.
activities are cost-saving measures that Michigan should               MMA will continue its efforts to defeat the anti-competitive,
consider implementing as part of the overall structural reform         job-killing Employee Free Choice Act at the federal level, and
effort. Returning Intermediate School Districts to their               will urge the Michigan Legislature to continue to express its
originally intended role of centralized administration would           disapproval of the Act.
save significant dollars by consolidating functions, without
abandoning school mascots or hindering educational quality.
MMA will advocate for educational reform efforts that promote
efficient and effective use of tax dollars.

                                           2010 Structural and Economic Reform Agenda for Michigan                                           7
    Competitive Regulatory Reform
    Efficiency in the regulatory process is an essential component in attracting capital investment. If the
    process is not predictably expedient, then Michigan will be removed from the list of potential locations for
    investment. When regulations in Michigan exceed federal standards, the cost of operating in Michigan
    exceeds that of our competitors. We must endeavor to improve the efficiency of regulatory processes,
    increase certainty in the timing of the permit process and remove regulatory barriers to Michigan’s
    ability to compete on the basis of cost in the global economy.

    Specific Policy Reform Goals:

    Ensure New Regulations Do Not Exceed Federal                          Require All New Regulations to Meet
    Standards Without Specific Legislative Approval                       a Rigorous Cost–benefit Analysis
        Each time Michigan imposes regulatory standards in                    Administrative rules can impose billions of dollars in
    excess of federal standards, a new economic barrier to our            costs on Michigan citizens and job providers, negatively
    competitiveness with other states is created. With the state’s        affecting our state’s competitiveness in the global economy.
    economic vitality at stake, the Legislature must take an active       MMA will fight for the requirement of a more detailed and
    role in thwarting such regulatory decisions for Michigan.             dynamic calculation of economic cost implications for citizens
    Legislative authority delegated to agencies should be limited         and job providers and an equally detailed and dynamic analysis
    to standards that do not create competitive disadvantages for         of the economic and/or other benefits in the required Regulatory
    Michigan. Several states provide similar restrictions.                Impact Statement for all new regulations.
    MMA advocates statutory changes that limit administrative             Advocate for Benchmarking of State
    rule authority for regulatory agencies.
                                                                          Regulatory Program Performance
    Advocate for Efficiency Improvement                                      In order to ensure that Michigan is competitive with
    Mechanisms in Regulatory Programs                                     other states and the global economy, the state must be held
       In 2005, MMA participated in a detailed evaluation of the          accountable for the performance of its regulatory programs.
    New Source Review program for the Air Quality Division of             Manufacturers need certainty and predictability in the
    the Michigan Department of Environmental Quality (DEQ).               permit process time frames to make rational investment
    With the cooperation of both the agency and industry partners,        decisions in Michigan.
    and by using an efficiency review mechanism called Value              MMA will continue to advocate that the state’s environmental
    Stream Mapping, the agency reduced permit review time                 programs should be reviewed and benchmarked against those
    frames by 66 percent.                                                 of other states, including permit issuance times, fees, cost of
                                                                          staff and the amount of regulation in Michigan.
    MMA will advocate for requiring every regulatory program,
    whether funded by the General Fund or fees, to implement
    an efficiency program to eliminate wasted effort and,
    ultimately, reduce the cost of operating and compliance
    with regulatory programs.

8                                           2010 Structural and Economic Reform Agenda for Michigan
Require Environmental, Health and Safety                              mandatory standard is more effective than a voluntary one
Standards to be Based on Sound Science                                such as exists at the federal level. In addition, MIOSHA
    Manufacturers deserve clarity in regulatory requirements,         has failed to establish a “clear and convincing need” to go
especially for rules dictating environmental, health and              beyond current federal regulation. Adoption of the proposed
safety standards.                                                     standard will position Michigan as only the second state to
MMA will oppose all proposed regulations that are not                 do so, but with the dubious distinction of having the most
objective, clear, measurable and based on sound science.              burdensome regulation on the books.
                                                                      MMA will continue to oppose the ill-advised ergonomic standard
Oppose the Use of Operational                                         that will make Michigan less competitive in attracting job-
Memoranda as Regulatory Tools                                         creating investment.
   Operational memoranda or agency guidance documents
are too often used as ad hoc rulemaking in regulatory                 Repeal the Annual Wastewater Report
programs. While some guidance from regulatory agencies is                This report symbolizes the excessive bureaucracy in
helpful, when these tools impose regulatory requirements,             Michigan’s regulatory climate compared to other states and the
dictate regulatory standards or are used in enforcement               need for the state to streamline its regulations. Duplicative
actions, agencies exceed their statutory authority.                   reporting obligations do nothing to protect the environment.
MMA will continue to object to the unconstrained use of               MMA will continue to advocate for the repeal of the Annual
operational memoranda by regulatory agencies, which can               Wastewater Report because it fails to serve any substantive purpose.
create regulatory uncertainty among entrepreneurial investors,
and adversely impact Michigan’s business climate.

Oppose Mandatory Ergonomic Standards
  Michigan-specific mandatory ergonomic rules are
unnecessary and place an anti-competitive burden on
Michigan job providers. There is no clear evidence that a

                                          2010 Structural and Economic Reform Agenda for Michigan                                            9
 Environmental and Energy Policy Reform
 Environmental requirements cost millions of dollars for job providers to implement. Michigan’s
 environmental and energy policies should be based upon sound science and reasoning. They need
 to be implemented objectively and designed to make Michigan more competitive with surrounding
 states and in the global economy.

 Our energy policies must ensure reliable power at economically competitive rates. The cost of
 electricity is a primary driver of cost competitiveness for manufacturers.

     Specific Policy Reform Goals:

     Protect Energy Plan Implementation                                     Continue to Advocate for Revisions in the Part 201
         Energy reliability and energy costs remain an integral             Environmental Remediation Programs to Eliminate
     part of Michigan’s competitiveness. The Energy Package of              Bureaucratic Barriers
     2008 achieved fundamental improvements: security, cost of                  MMA has been actively advocating solutions to the
     service rates and retention of choice options for manufacturers.       challenges faced by the DEQ in approving more closures
     As the complex statute is implemented, MMA will work to                of contaminated sites. The current process is a clear barrier
     ensure the statutory policies of Michigan’s Energy Package are         to economic and environmental progress for Michigan.
     maintained through the administrative implementation process.          MMA stands ready and willing to continue to propose solutions
                                                                            to the Part 201 program that break down barriers and enable
     Support the Development of Base-load Power Generation                  public-private agreements that will attract new investment that
         A fundamental part of the Energy Act passed in 2008                will clean up contaminated property and increase the number
     was to promote the building of new coal plants to provide              of approved closures in Michigan.
     base-load generation that increases the long term supply of
     reliable energy for Michigan. MMA will continue to push                Support the Beneficial Reuse of Industrial By-products
     the Governor and the state to live up to the commitments                  The most effective environmental programs reduce waste
     made with passage of the Energy Act.                                   by recycling products for beneficial use. Current law prohibits
     MMA will advocate for issuance of the required permits and             the reuse of many materials as it defines by-products as waste,
     fight bureaucracy that stands in the way of development of             prohibiting their reuse.
     reliable energy for Michigan’s manufacturing community.                MMA will continue to seek statutory changes and revisions to
                                                                            administrative rules and agency policies that currently block
     Oppose Any Efforts to Exceed Federal                                   the sensible reuse of industrial by-products.
     Climate Change Requirements
        Climate change is a global issue that must be addressed             Advocate Returning More General Fund
     nationally, and in conjunction with the rest of the world.             Support to Regulatory Programs
     Imposing significant regulatory costs on Michigan job                     In the last decade, General Fund support for DEQ programs
     providers through a statewide or regional approach creates a           has dropped by $70.6 million. During that same period,
     competitive disadvantage for Michigan, while contributing              regulatory fees have increased by $57.5 million, effectively shifting
     very little to the global solution.                                    the program costs of the DEQ to the business community.
     MMA will oppose any state and/or regional regulations                  MMA will continue efforts to encourage more General Fund
     addressing climate change that exceed federal climate                  support for regulatory programs to eliminate the cost shifts to
     change requirements.                                                   manufacturers that negatively impact the cost of producing
                                                                            products in Michigan and decrease our ability to compete
                                                                            globally on the basis of cost.

10                                            2010 Structural and Economic Reform Agenda for Michigan
Fight to Repeal DEQ’s Administrative                                   Oppose Environmental Justice
rule on Mercury Reductions                                             Efforts that Affect Permitting
   The U.S. Environmental Protection Agency (EPA)                          Uncertainty in permitting creates an additional barrier
continues to develop a more restrictive alternative to its             to job creating investment in Michigan when compared to
previously proposed Clean Air Mercury Rule in compliance               other states. Environmental permitting programs should be
with U.S. Court of Appeals actions, a case brought, in part,           predictable, based on sound science and applied consistently
by the State of Michigan. MMA testified extensively in                 throughout the state. Any process that relies on subjective
opposition during the promulgation process. The DEQ                    decision making is bad for Michigan’s business climate.
did not adequately identify the anticipated incremental                MMA will fight any efforts put forth that impact environmental
environmental benefits to be gained over the impending                 permitting under the guise of environmental justice.
federal rule. The additional costs paid through electric bills
not paid by other states make Michigan less competitive.
MMA will seek repeal of the state-based mercury rule which
represents a clear competitive disadvantage for Michigan by
imposing regulations years before the EPA is expected to impose
regulations on other states and in excess of what other states
will likely be required to spend.

Oppose Tax Increases on Manufacturers for Waste Disposal
    Waste is an item of commerce and represents both economic
activity and much-needed state revenue. Manufacturers already
recycle at a very high rate. This is why MMA believes they
should not have to pay new waste disposal fees, on top of
the disproportionate tax burdens that are already placed on
manufacturers in Michigan, to fund residential recycling programs
or to fund revenue shortfalls for local units of government.
MMA will continue to oppose all efforts to impose waste disposal
fees or to raise existing fees on Michigan companies to discourage
importing out-of-state waste.

                                           2010 Structural and Economic Reform Agenda for Michigan                                      11
 Transportation and
 Infrastructure Reform
 The efficient transportation of goods is an essential component for a competitive economy. Allowing
 our transportation system to decline in quality, or not keep pace with the speed and logistics of the
 increasing pace of the global economy, will keep Michigan out of the game of global commerce. We
 must support our infrastructure and continue to seek out opportunities to be competitive globally.

     Specific Policy Reform Goals:

     Support Development of the Detroit                                   Support Infrastructure Funding
     River International Crossing                                            Adequate road and bridge infrastructure funding must
        The Detroit and Windsor connection is the busiest trade           remain a priority for Michigan’s long-term economic success.
     corridor between the United States and Canada. The limited           This infrastructure is necessary for the shipment of raw
     capacity of this single crossing currently hinders the speed of      materials, parts and goods within the state and for routing
     delivery of both finished goods and part supplies for Michigan       our exports. Without adequate matching funds, the MDOT
     manufacturers. The Michigan Department of Transportation             will lose almost $600 million in federal aid beginning in
     (MDOT) and the Canadian government have agreed upon                  2011, and $1.9 billion between 2011 and 2013.
     plans for the expansion of the Detroit River International           MMA supports a comprehensive solution for longer term funding
     Crossing, known as DRIC.                                             that includes fuel taxes, and a longer vision anticipating the
     MMA supports the efforts of the MDOT to pursue options for an        electrification of automobiles, to secure adequate infrastructure
     additional bridge connection to Canada over the Detroit River.       funding for the Michigan economy.

     Support Detroit Region Aerotropolis
         Michigan needs to build its transportation infrastructure
     to attract job creating investment. Increasing the speed of
     supplier parts or finished goods makes Michigan products
     more competitive in the global economy. The proposed
     Aerotropolis project would do both for the Detroit area and
     is projected to attract 64,000 jobs to the region.
     MMA supports the Detroit Regional Aerotropolis goal of making
     the Wayne Washtenaw corridor a strong economic engine for
     the region by developing an international hub for the transport
     of goods.

12                                           2010 Structural and Economic Reform Agenda for Michigan
                                                     Health Care Cost Reform
The soaring cost of providing health care presents an ominous challenge for manufacturers today. Cost
containment strategies that reduce the existing burden, as well as control costs in the future, are a
must in order for Michigan manufacturers to hire or retain workers and continue to provide health
care benefits for them. Reigning in health care costs is instrumental to competing globally.

Specific Policy Reform Goals:

Oppose Mandated Employer-Funded Insurance Policies                       Oppose Specific Health Care Benefit Mandates
    The voluntary nature, flexibility and innovation of the                  MMA consistently voices strong opposition to specific
current employer-based system should be preserved and                    health care coverage mandates not only because of the
strengthened. Adding additional costs on employers to                    increased cost that every mandate imposes, but also our
provide (or not to provide) insurance increases costs for                strong belief that decisions regarding health insurance
businesses and reduces Michigan manufacturers’ ability to                coverage should be free of government interference and left
compete on the basis of cost in the global economy. The goal             between employers and employees as to what coverage is
must be to reduce the cost of health care on job providers.              needed and what they can best afford.
MMA is opposed to an employer “pay or play” mandate which                MMA will continue to oppose new mandated specific health
would increase the cost of doing business in Michigan.                   care benefits which ultimately drive up the cost of employer
                                                                         sponsored health care.
Protect Certificate of Need Process
   Overutilization is a significant cost driver in health care,          Promote Wellness Incentives
which has been shown in comparisons with other states                        Wellness programs promote and reward employees taking
without Certificate of Need (CON) programs.                              personal responsibility for their own health and can save both
MMA will continue to support a strong CON process to preserve            lives and money.
the savings it contributes to Michigan’s health care delivery system.    MMA continues to support prevention and wellness programs
                                                                         for both public and private health plans.
Combat Cost Shifting of the Uninsured
   Tax or fee increases on employers, directly or indirectly,
are not viable remedies to cover the cost of the uninsured.
MMA will continue the search for a solution to the constant
problem of cost-shifting, from the uninsured to private sector
policies, through promotion of meaningful and effective cost
containment strategies.

                                             2010 Structural and Economic Reform Agenda for Michigan                                      13
 Protect Business Climate from Rising
 Litigation Costs
 The litigation climate is a critical component in defining the overall business climate. The National
 Association of Manufacturers reports that the American legal system costs the nation’s economy $865
 billion annually. This is equivalent to a 5 percent “tort tax” on wages, or 2.2 percent of the Gross
 Domestic Product (GDP), and it is significantly higher than the costs of our largest trading partners
 and competitors. Michigan’s litigation climate remains a bright spot in our business climate, providing
 a competitive advantage for Michigan companies.

 Specific Policy Reform Goals:

 Protect Property Rights                                               Maintain an Effective Amicus Curiae Program
    Property owners deserve to own property under the terms                The MMA Lawyers committee has been a powerful voice
 and conditions in which they purchased the property. The              in the court system, speaking for and protecting the rights of
 common law principals of public trust lay the foundation for          manufacturers.
 protection of a property owner’s rights to access groundwater         MMA will remain vigilant in its ongoing efforts to file amicus
 on their property.                                                    briefs in appellate court actions that would threaten Michigan’s
 MMA will oppose any legislative effort to amend the common            business climate.
 law principals governing property rights.

 Protect Tort Reform
    Michigan’s legal protections for drugs produced in compliance
 with the rigorous approval process of the U.S. Food and
 Drug Administration must remain in place. Litigation costs
 drive up health care costs, and hinder the ability of Michigan’s
 manufacturers to compete on the basis of cost.
 MMA opposes efforts to erode Michigan’s current tort protections.

14                                        2010 Structural and Economic Reform Agenda for Michigan
       Importance of Manufacturing in Michigan
Manufacturing is the backbone of the Michigan economy. We have a proud history of being a global manufacturing
leader. And while changes in the global marketplace hit the manufacturing sector hard in the last decade, manufacturing
remains a vital — and vitally important — industry. Why? Because when manufacturing thrives, so does the state of
Michigan. Here are just a few reasons why manufacturing is so critical to our state:

#1                                                 1,694                                       153,700
Manufacturing is, by far, the largest              Michigan has over 1,694 Tool and            Michigan produced an average of
sector of Michigan’s economy,                      Die shops — more than anywhere              over 150 thousand vehicles per month
contributing 21% of the state’s                    else in the world — employing 33,893        in 2008. Source: Michigan Economic Update,
Gross State Product (GSP) — more                   skilled workers. Source: U.S. Bureau of     Michigan Department of Treasury, 9/2009
than any other sector. (See chart below.)          Labor Statistics, 2008
Source: U.S. Bureau of Labor Statistics, 2008
                                                                                               $61.8 billion
492,200                                            23.7%                                       Michigan’s manufacturing output
                                                   While Michigan manufacturing has            was $61.8 billion in 2008. Source:
Manufacturing provided almost                                                                  U.S. Bureau of Economic Analysis, 2008
                                                   become increasingly more diversified,
500,000 direct jobs in 2009 and,
                                                   auto production is still the largest of
with the highest economic multiplier
                                                   all manufacturing sectors at 23.7%.
of any other industry, supports an
estimated 3.7 million other jobs in
                                                   Source: NAM Facts About Michigan            89%
                                                   Manufacturing, 2008.
the state. Source: Michigan Department                                                         Manufacturing’s share of total state
of Labor and Economic Growth, Labor                                                            exports is 89%. Source: NAM Facts
Market Information 11/2009                                                                     About Michigan Manufacturing, 2008.

                                                                            Michigan GSP by Sector
                                                                                               Manufacturing is the largest
                                                             Government, 10%                 sector of Michigan’s economy.
                               Other services, except
                                 government, 2%
                                                                                        Manufacturing, 21%
                                Accommoda on and
                                 food services, 2%
                        Arts, entertainment,
                         and recrea on, 1%
                       Health care and social
                          assistance, 8%                                                                    Agriculture, forestry,
                                                                                                            fishing and hun ng, 3%
               Educa onal services, 1%
                                                                                                       Mining, 0%
               Administra ve and waste
                                                                                                                     U li es, 2%
                    services, 3%
                                                                                                       Construc on, 2%
                      Management of
                      companies and
                      enterprises, 2%
                                                                                                      Wholesale trade, 6%

                  Professional and technical
                         services, 9%                                                          Retail trade, 8%

                            Real estate and rental and                                Transporta on and
                                   leasing, 11%                                        warehousing, 3%
                                                                  Finance and
                                                                 insurance, 6%   Informa on, 4%
                                   MMA Policy Committees
Representatives of MMA-member companies sit on the MMA Policy Committees. The committees meet regularly
or as needed to review issues and developments in industry and to help develop public policy positions.

Government Affairs Advisory Committee              Energy Policy Committee                              Technology Policy Committee
Staff Contact: Mike Johnston                       Staff Contact: Mike Johnston                         Staff Contact: Randy Gross
Provides opportunities for input into policy       Serves as a forum for exchanging information         Explores opportunities for companies to
direction for MMA on every major issue             on energy utilization and potential industry         effect policies that encourage investment in
impacting manufacturers. Helps develop MMA’s       strategies to ensure an adequate supply of           new and advanced technologies in Michigan.
Legislative Agenda. Also provides opportunities    reliable power at economically competitive           Issues addressed by this committee include
to interact with state government officials.       rates. Plays a vital role in developing MMA’s        pharmaceutical, chemical, defense, automotive,
                                                   Legislative Agenda as it relates to energy policy.   telecommunication, power generation and many
Tax Policy Committee                               Forms ad hoc sub-groups as needed to address         other sectors.
Staff Contact: Mike Johnston                       specific issues as they arise.
Helps determine tax policy priorities for the                                                           Tool & Die Advisory Committee
MMA Legislative Agenda and provides                Human Resource Policy Committee                      Staff Contact: Mike Johnston
opportunities for input into tax policy            Staff Contact: Jennifer Spike                        Provides guidance and educational experiences
development for the Legislature and the            Serves as a forum to discuss and provide             for members of the tool, die and mold-making
Executive Branch.                                  direction on a full array of legislative and         community. Supports the collaboratives
                                                   regulatory policy areas, including health            created through the Tool and Die Recovery
Air Policy Committee                               care, employment and labor issues, employee          Zone Act.
Staff Contact: Randy Gross                         safety and health related to MIOSHA and
Actively monitors and participates in the          workers’ compensation, as well as education          Lawyers Committee
development of legislative and regulatory air      and workforce training issues. Subcommittees         Staff Contact: Mike Johnston
quality policy. Plays a vital role in developing   focus on specific issues to ensure thorough          Drives MMA’s amicus curiae program,
MMA’s Legislative Agenda as it relates to air      review by members with specific and                  taking an active role in major court cases
policy and serves as a forum for members to        specialized expertise.                               that may impact manufacturers. Ensures
share ideas and thoughts on air related issues.                                                         that the manufacturing community’s
Forms ad hoc sub-groups as needed to address       Subcommittees:                                       influential voice is heard in the judiciary
specific issue as they arise.                       • Healthcare Subcommittee – Monitors                branch.
                                                      issues that impact employers’ health
Environmental Policy Committee
Staff Contact: Randy Gross
                                                      care costs.
Addresses all non-air related environmental         • Employment and Labor Subcommittee –
issues of concern to manufacturers. Members           Addresses unemployment compensation,
actively monitor water, solid waste, remediation      wages and benefits.
and other environmental regulations and
participate in the development of legislative       • Employee Safety & Health Subcom-
and regulatory policy. Plays a vital role in          mittee – Focuses on matters related to
developing MMA’s Legislative Agenda as it             MIOSHA standards and regulations as
relates to environmental policy and serves as         well as workers’ compensation.
a forum for members to share ideas and              • Education & Workforce Training
thoughts on environmental issues. Forms               Subcommittee – Addresses education
ad hoc sub-groups as needed to address specific
                                                      reform initiatives, workforce development,
issues as they arise.
                                                      job training and retraining.

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