6 key battles Michigan’s lawmakers could tackle this fall

Sept. 05--LANSING -- The continuing battles over no-fault auto insurance, municipal employee pensions and retirement benefits, road funding, mental health services, aid for Flint residents and the rare possibility of an override of a Gov. Rick Snyder veto will confront legislators when they return to Lansing on Wednesday after a two-month summer break.

Republican and Democratic leaders in the state House of Representatives and Senate have a wish list of priorities they'd like to tackle through the end of the year. Not all will get a hearing -- Republicans control the majority and the agenda in both chambers and may not allow debates or votes on many Democratic proposals. Some will probably get pushed into next year.

But there are a few issues that all can agree will become a focus during the next three months.

No-fault auto insurance reform

The Legislature has tried for years to rework Michigan's auto insurance system, which is rated one of the most expensive in the nation for drivers.

More: No-fault car insurance in Michigan: Here's how it works

The key sticking point has been trying to put a cap on Michigan's unique unlimited lifetime benefits for people catastrophically injured in auto accidents. That approach hasn't gotten enough support, so Detroit Mayor Mike Duggan is working with lawmakers to try to come up with a plan that not only will provide relief for beleaguered city residents, who can pay up to $5,000 a year for car insurance, but also provide rate relief across the state.

"This issue affects nobody more than him and the 600,000 people that he represents in Detroit," said Speaker of the House Tom Leonard, R-Dewitt. "All options are going to be on the table. We want to lower premiums."

Senate Majority Leader Arlan Meekhof, R-West Olive, also tagged auto insurance reform as a top priority, but added, that some incremental steps -- controlling the amount paid to health care aides of catastrophically injured people and creating an authority to deal with claims of fraud -- are more likely than wholesale change.

"It's not unreasonable with some of the policies Mayor Duggan is talking about, but I think he's overly optimistic on getting it through politically," Meekhof said.

Both Senate Minority Leader Jim Ananich, D-Flint, and House Minority Leader Sam Singh, D-East Lansing, said they're willing to broach insurance reform, but want to make sure that Democrats are included in crafting a solution, which hasn't happened in the past.

"We've always been open to having a comprehensive conversation on no-fault auto insurance reform, but the last proposal I saw only cut $100 per year from insurance premiums and they called that a reform," Singh said. "It was just a gift to the insurance industry."

Veto override

Both the House and Senate overwhelmingly passed legislation that would accelerate a tax cut approved in 2013 for those trading in a vehicle when purchasing a new or used vehicle.

More: Gov. Snyder vetoes legislation to speed up tax cut on vehicle sales

But Snyder vetoed the legislation, saying it would create additional pressures on the state budget.

With votes of 37-0 in the Senate and 88-19 in the House, there's the two-thirds support in the chambers that is needed to override Snyder's veto, which is something that's only happened three times in the last 66 years.

Meekhof said it's something he'll discuss with his caucus this week, but that he's leaning toward bringing it up for the rare vote, even though he realizes it might negatively impact his working relationship with Snyder.

"The last Republican governor that happened to (former Gov. John Engler), the relationship was decidedly different after that," Meekhof said.

The 2013 legislation, known as the "sales tax on the difference" legislation, reduces the sales tax paid by buyers who use a trade-in toward the purchase. Once fully phased in, buyers would only pay 6% sales tax on the difference between the price of the vehicle they were buying and the value given to their trade-in.

The tax cut was supposed to gradually happen over 25 years, but the legislation greatly accelerated the phase-in of the cut.

Ananich said he's ready to take the vote, while Leonard and Singh said they've got to take the temperature of their members before pledging support for the override.

Municipal pension and retirement benefit reform

The issue was one of the key Republican victories earlier this year, when teacher pension reform passed with only Republican support. And now Meekhof wants to expand that reform to municipal employee pension and retirement benefits.

"We have communities struggling with these legacy costs," he said of his top priority for the rest of the legislative session. "We have to find a way to protect taxpayers."

More: With teacher pension changes signed into law, Legislature wants more benefit changes

The last time legislators tried to tinker with municipal pensions and retirement benefits last year, throngs of police and firefighters -- a potent voice in Lansing -- descended on the state Capitol and forced Republicans to, at least temporarily, abandon the effort.

If it comes up again, the opposition will once again be fierce.

Mental health reforms

At the top of Leonard's wish list is reforming the delivery of mental health services in Michigan. He appointed a task force that has been holding public hearings across the state this summer with the goal of crafting legislation that could help with both the mental health and corrections' budgets.

"We've done some great work expanding the mental health courts, but we've got to get to these people sooner than that," Leonard said, noting that at least 25% of the inmates in Michigan's jails and prisons have mental health issues. "I'm looking for legislation that will connect folks to services" before they end up in the criminal justice system.

The other legislative leaders believe the goal is admirable, but probably deserves a broader debate.

"That's a longer public policy discussion," Meekhof said. "There is a growing need and it bleeds into corrections and health care. I just don't know what all the solutions would be."

Ongoing Flint water crisis

As another means to help Flint, Ananich is pushing a bill that would allow the city to participate in the Promise Zone program, which would help pay college tuition for city students, to be taken up in the House. It passed the Senate easily earlier this year, but has been stuck in the House Education committee since May.

He'd also like to take up policy initiatives that would address some of the problems identified in Flint and translate those lessons to water systems across the state, including quicker notification to residents of problems in their water and better transparency for residents on water quality reports.

More: Flint water crisis to remain an issue through the 2018 governor's election

Meekhof said he thinks the promise zone legislation is a no-brainer, but is skeptical of other legislation. He wants to make sure that the $250 million in state money and $100 million in federal funds is being effectively used in the city, where water was contaminated with lead after the city, which was under the control of a state-appointed emergency manger, switched the city's water source from the Detroit Water and Sewerage Department to the Flint River.

Democrats' wish list

Proposals to put more money into the state's roads and tackle the high cost of prescription drugs are at the top of the list for Democratic leaders. But both are long shots in the Republican-controlled Legislature.

Singh wants to put more money from the state's rainy day fund into Michigan roads, bridges and water infrastructure. In the budget passed in June, $150 million was put into the rainy day fund and $35 million was put into an infrastructure fund.

"If you look at the roads, bridges and our water systems throughout the state, they need significant support," Singh said. "We have a very healthy rainy day fund, but it's raining. Things are leaking literally."

With the failure of Congress to repeal or replace the Affordable Care Act, Ananich said getting a handle on health care will fall to state Legislatures. In Michigan, more than 680,000 low-income residents are enrolled in the Healthy Michigan plan, which is the Medicaid expansion enabled by Obamacare.

"With so much uncertainty in Washington and everything that has come forward about the possibility of people losing care, we have to be the responsible ones to make sure people are protected in Michigan."

Getting the Medicaid expansion through the Legislature was a challenge in 2013 and the House and Senate has only gotten more conservative after the 2014 and 2016 election cycle. So Democrats acknowledge that getting additional health coverage for low-income Michiganders will be a heavy lift in 2017.

Contact Kathleen Gray: 313-223-4430, kgray99@freepress.com or on Twitter @michpoligal

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