The Michigan Legislature returned from summer break last week and started on what is expected to be an action-packed September and October. This week, the legislature is working on several issues that are a priority for the League. Below is a quick preview of these issues, which we will provide additional information on as they move forward.
Revenue Sharing Trust Fund
- HB 4274 and 4275 have been posted for House Local Government and Municipal Finance Committee. This legislation would create a revenue sharing trust fund and help better secure local resources. The bills have already received a hearing and we anticipate they will be voted out of committee. This is a top priority for the League.
Disabled Veterans Property Tax Exemption
- Two different committees will take testimony on bills dealing with the Disabled Veterans Property Tax Exemption.
- House Military, Veterans and Homeland Security will take up SB 176, 330, and 364. These bills would ensure a unmarried surviving spouse could continue to receive the property tax exemption and move from an annual filing to a one-and-done filing. This legislation does not address shifting the costs from locals to the state.
- House Local Government and Municipal Finance Committee will take up HB 4894, 4895, and 4896. This three-bill package will shift the cost from the municipality to the state and address the surviving spouse issue. It will also expand the exemption to veterans who live in a co-op and require the state to cover those costs.
- We are watching these two packages very closely. We do understand the need to address the issue for an unmarried surviving spouse and simplify the filing process, but we must also address the cost burden this exemption has placed on locals. This is another top priority for the League, and we will be working with legislative leaders to secure passage of this legislation.
Personal Property Tax Small Tax Payer Exemption
- In 2021 as part of a budget supplemental, the state expanded the personal property tax small tax payer exemption from $80k to $180K. This resulted in an approximate $75M hit to local budgets. When this expansion took effect, there was a one-time $75M appropriation to cover the cost to locals and an expectation that bills would be introduced to create a permanent fix. Three bills have been introduced to codify a permanent reimbursement mechanism and revenue stream. They are Senate Bill 331, House Bills 4553, and 4554. They are scheduled to receive a hearing in Senate Finance and House Tax policy, respectively this week. The League supports these bills.
- A few years ago, the Michigan Legislature passed legislation clarifying that residential streets do not need a speed study to set the speed at 25 mph. That legislation also created a sunset for the end of 2023 with clarifying language and required the Michigan State Police to study the impact of this change. House Transportation Committee will be taking up HB 4126 that will eliminate this sunset and make the policy permanent. The League supports this legislation.
- House Tax Policy will take testimony this week on two bills, HB 4350 and 4351, that would dedicate resources and provide grants to communities whose per capita taxable value is less than the statewide per capita taxable value. The League supports this legislation.
Minimum Staffing Levels
- House Labor Committee will be taking testimony on HB 4688. This bill would make minimum staffing levels in local governments a negotiable condition of collective bargaining. We are very concerned about the impact this bill could have on municipal budgets and the services we provide. We will be testifying on the bill and encourage you to consider the potential impact on your community and reach out to your legislator with any concerns you have.
We are excited that many of the League’s top priorities are receiving attention in committee this week. We are hopeful that much of this action will provide substantial benefit to municipalities across the state and encourage you to weigh in.
John LaMacchia is the League’s director of state & federal affairs. He can be reached at [email protected] or 517-908-0303.