NEWS BRIEF – WEEK OF SEPTEMBER 14, 2009

Federal Updates Healthcare Update As we reported last week, Sen. Max Baucus (D-MT), chair of the Senate Finance Committee, will be marking up his healthcare proposal on Tuesday. The legislation does not include a strict employer mandate, but still would trigger many changes for employer-provided healthcare and will raise costs for businesses with more than 50 employees. A group of organizations are also petitioning a revenue provision in the plan which would create more burdensome reporting requirements and bring higher administrative costs for small businesses. The House Energy and Commerce Committee will be marking up its version of a healthcare plan on Wednesday. The House plan includes an aggressive ‘pay-or-play’ employer mandate which would impose a payroll tax on businesses that do not contribute to employee healthcare coverage. Reps. Frank Kratovil (D-MD) and John Barrow (D-GA) are working on a letter that addresses the employer mandate and expresses concern over how it will hurt small businesses. When the letter is complete, we will review and will likely recommend BPAA members to sign on in support of their efforts. We are also determining the cost of an employer-sponsored plan that would avoid penalties. When we know that impact we will then advise your state network on appropriate grassroots. Merchants Payments Coalition Releases Report on Credit Card Fees The Merchants Payments Coalition (MPC), which includes the BPAA, released a report on Thursday that shows Americans are paying higher "swipe fees" on credit cards than other countries. The report finds that the $2 in interchange fees per $100 in purchases on credit cards (paid by retailers and felt by consumers through higher prices) is double the charges in other countries like the U.K. and New Zealand and four times the rate in countries like Australia. Legislation to reform interchange fees, the Credit Card Fair Fee Act of 2009, is currently pending in Congress. We encouraged your state association to contact your Congress members and ask them to support this legislation. Talks Continue on Employee Free Choice Act Work continues on the Employee Free Choice Act (EFCA) but details of the legislation remain unclear, with even key members of Congress in the dark. Claims from Sen. Arlen Specter (D-PA) that card check—which eliminates the secret ballot for workers deciding whether to form a union—was removed were quickly refuted by other Democratic leaders. Businesses and a number of legislators are also concerned with provisions that Specter outlined, including quickie elections for unionization and binding arbitration—which would allow negotiators to set wages, benefits, seniority, etc. It’s too early to recommend another round of grassroots, but we will activate your state network when the debate heats up again. Massachusetts House Approves Legislation to Appoint Interim Senator On Thursday, the state House approved legislation that would give Gov. Deval Patrick (D) the power to appoint a temporary U.S. Senator to fill the seat of the late Ted Kennedy. The bill now heads to the state Senate, where legislative leaders say there are enough votes to pass the bill and send it to Gov. Patrick (who has promised to sign the bill) by Wednesday. The move would give Democrats an additional vote in the Senate to help pass crucial issues like healthcare and EFCA.

ALCOHOL

Wisconsin Assembly Approves High-BAC, Repeat-Offender Interlock Mandate On Thursday, the state Assembly unanimously approved legislation that would require ignition interlock devices in the vehicles of all repeat drunk drivers and first-time offenders with a blood alcohol content (BAC) of 0.15 or greater. The devices would be required for one year. The bill now heads to the Senate for consideration. Majority Leader Russ Decker (D-Weston) says the Senate is committed to passing the bill, but it will have to figure out how to fund the mandate. The hospitality industry has supported these targeted mandates that focus on the most dangerous drivers.

FOOD

Health Journal Calls for National SodaTax On the heels of President Obama’s comments endorsing a federal tax on soda, the New England Journal of Medicine (NEJM) has published a report that calls for a penny-per-ounce tax on soda to help reduce obesity and to raise government revenue. An actual proposal has yet to be introduced (efforts to include a sodatax proposal in House healthcare legislation were not successful), but food activists are gaining momentum on the issue. We will continue to keep you updated if the issue progresses.

LABOR/WAGE

Oregon Indexed Minimum Wage Will Not Increase in 2010 Oregon Labor Commissioner Brad Avakian has announced that the state minimum wage will not increase on January 1^st. The Consumer Price Index (CPI)—the measurement of inflation that is used to calculate the annual increase—decreased 1.5 percent from August 2008 to August 2009, and thus the minimum wage rate will remain at $8.40 per hour. Milwaukee, WI Mayor and City Council President Oppose Paid Sick Leave Mandate In a written statement, Milwaukee City Attorney Grant Langley said that the city will not take part in the appeal of a court ruling that invalidated a paid sick leave mandate (passed via ballot initiative in 2008). Langley’s decision was driven by Mayor Tom Barrett (D) and City Council President Willie Hines’ (D) opposition to the appeal. The local lawmakers note that a paid leave mandate would create an unfriendly business environment in the city. The new law—which was permanently blocked—would have required private employers in the city to provide up to 9 days of paid sick leave per year for employees.

SMOKING

Kansas Governor Calls for Statewide Smoking Ban Gov. Mark Parkinson (D) has made public his desire to put "full effort" into lobbying lawmakers for a statewide smoking ban (and he may also consider a cigarette tax increase). Earlier this year, then-Gov. Kathleen Sebelius had also tried to enact a smoking ban, but legislation in the legislature failed to advance. Group Calls for Smoking Ban in Oregon Casinos On Thursday, the American Lung Association of Oregon asked Gov. Ted Kulongoski (D) to include the state’s nine tribal casinos under the state smoking ban. The ban, passed in 2007, prohibits smoking in all indoor working places. In January of 2009, bars and restaurants (including those attached to bowling centers) were included in the ban, and the Association would like to see those same standards applied to state casinos.

Budget Update as of 9/18/09 at 10 a.m.

With just 12 days to go until our Sept. 30 deadline to balance the state budget, I'm writing to give you an update of what's happening at our State Capitol. Over the next 12 days I will be providing budget updates on a regular basis. It is important that we try to keep our communication lines open during this period and I will do my best to try to keep you up to date on negotiations.

As you know, the economic situation in Michigan this year is very difficult and has dramatically decreased the amount of revenue the state has to fund services. As a result, we now find ourselves with an approximately $2.8 billion deficit. I understand it is imperative that we reach a resolution to the budget as soon as possible. The uncertainty to school districts and municipalities makes it very difficult for them to formulate their own budgets.

My colleagues and I are making progress in reaching a budget resolution. As a member of the House Appropriations Committee, I was named on Thursday to bipartisan conference committees that will work with the Senate to do this.

Our task is not easy – there are extremely tough choices to make. We all know that Michigan is in terrible financial shape, due to many factors: the struggles of the auto industry, the national recession that hit Michigan first and hardest, the national economic downturn, etc. State revenues are down in part because of our 15.2 percent unemployment rate.

There's no doubt that severe, painful cuts must be part of the solution. House members are ready to make those tough choices in order to create a leaner, more efficient government, move our state forward and avoid a shutdown.

But let me make one thing extremely clear: There are certain priorities that I and many of my colleagues will not compromise on! We simply cannot – and will not – give up the fight for what truly matters most to our residents and to our state's future.

No matter what happens, I will fight for four key priorities:

Police and fire protection: We must provide the funds our local communities need to keep police and firefighters on our streets so our families and communities stay safe.

School readiness programs and K-12 funding: Every child has the right to a quality education so they're prepared to succeed in life and in the 21st century economy.

The Michigan Promise Scholarships: Every high school student who has worked hard deserves the opportunity to go to college and learn the skills they need to make a better life for themselves.

Health care for our most vulnerable citizens: We in Michigan do not turn our backs on kids and seniors who lack basic medical care.

I've included a list of key cuts below included in the plan that a divided Senate passed. Please look at the list and consider how much these programs make a difference in your lives and the lives of your children, your family members, your neighbors…

So much is at stake: Do we want to risk losing our home to a fire because our firefighters are stretched too thin? Do we want to lose a whole generation of kids to failing schools? Do we want to close the door to middle class families who dreamed of sending their kids to college? Do we really want to turn our backs on kids who need a healthy start in life? I don't think so … and I don't think that most of you want to, either.

Your support is always appreciated. Please feel free to forward this update to anyone you think is interested in knowing what's happening at the Capitol.

Please also feel free to e-mail me at richardleblanc@house.mi.gov – I am eager to hear your ideas and concerns.

Sincerely.
State Representative Richard LeBlanc
18th House District

Some cuts included in the budget approved by the State Senate:

Cut Family Independence Program grants to very poor families with children by $24 million

On Tuesday, February 3, Governor Jennifer Granholm presented her annual State of the State message before a joint session of the Michigan Legislature. The address focused on goals of creating jobs, education, and training citizens, and protecting families.

The Governor also outlined a crucial new goal that would reduce Michigan’s use of imported energy and it’s reliance on fossil fuels for generating electricity by 45 percent by the year 2020. This goal would be reached by increasing our use of renewable energy sources, energy efficiency, and other new technologies.

The Governor offered the following steps to assist the state in meeting this ambitious goal:

The Governor asked that its citizens, "Support Michigan. Select Michigan. Buy Michigan. Everything from Ford to Faygo. From Bell’s Beer to Blueberries. While we may court new investment from outside our state, our first love is the businesses that have long called Michigan home."

On Thursday, February 12, State Budget Director Bob Emerson will present Governor Granholm’s 2009-10 State Budget, which is being described as "grim." The State of Michigan will likely face an anticipated $1.4 billion deficit and the Governor has warned of drastic cost-cutting measures in the upcoming budget. You may recall the last time the state faced such a deficit in 2007, lawmakers devised a plan to place a tax on certain services to address the budget deficit. Although this sales tax on service was eventually overturned prior to going into effect, the Legislature then placed a "surcharge" on the new Michigan Business Tax. As of this writing it is unlikely that the Governor or the Legislature have the appetite to propose and/or enact revenue enhancing programs. The focus of the deficit will be a combination of any forthcoming federal stimulus monies and budget cuts to various state programs.

At this time, there has been no official action taken on the indoor smoking ban. Though legislation has been introduced in the Michigan Legislature, there have been no hearings to date. House Speaker Andy Dillon has indicated to Karoub Associates that his caucus may revisit the smoking ban issue later this spring and Senate Majority Leader Mike Bishop would again not like to deal with this issue at all. However, as Karoub Associates has relayed to members of the BCAM in the past, this issue is not going away anytime soon. We fully anticipate the smoking ban legislation to receive legislative consideration in the near future. We will continue to work with your legislative committee and provide timely and accurate information to your association leadership on this matter of vital interest to members.