Q&A on the Detroit bankruptcy settlement bills

Transcription

1 May Q&A on Detroit Bankruptcy -Responsible Minimum Wage Increase -Thank You Veterans -Veteran License Designation -Michigan National Guard -Bright Future for Michigan -MILE Program -Efficient Government Leading Michigan Q&A on the Detroit bankruptcy settlement bills Why are you doing this? For decades both the Detroit City Council and the pension boards mismanaged their budgets and eventually led the city into bankruptcy. Because Detroit is a legal subset of the state, taxpayers could end up being on the hook for Detroit s unfunded liabilities. The proceedings and litigation could go on for years even decades and end up costing taxpayers in the ballpark of $3.5 billion to finally resolve it. Many are starting to view Detroit as an innovative hub of start-ups and technology companies and as a growing, cultural city of young professionals. But some investors remain on the sidelines watching to see what happens next. If the bankruptcy isn t settled, those investors will take their capital to other states, investing and growing their businesses elsewhere. It would be easy for us as lawmakers to simply look the other way and say we don t care about Detroit. But we weren t elected to look the other way. We were elected to right the ship that for too long sailed through choppy waters with no one at the helm. How can you say this isn t a bailout? You are just pouring more money into Detroit. This is a complete restructuring of Detroit s finances and the operations of its city government. For years, the City Council and pension boards mismanaged funds and budgets and drowned the city in its own debt. We are putting stringent controls in place to keep the city on track with its spending. A chief financial officer will be hired to oversee the city s finances and plan budgets far in advance. A new oversight commission, the Michigan Financial Review Commission,

2 will be responsible for reviewing expensive city contracts, and those contracts for services will be posted on the city s website, completely transparent for all to see. We are beginning anew starting from scratch to create a framework for responsible governing in Detroit. Where are we getting the money for this? From all over the state, groups have come to the table to find a solution to Detroit s bankruptcy. First a group of nonprofit foundations came forward with a pledge of $366 million. Next was the Detroit Institute of Arts, offering $100 million. Now various unions have begun coming forward, acknowledging that it is time for them to contribute as well. With the state s contribution of $194.8 million, all of these groups combined will offer more than $800 million to help settle the unfunded liabilities, help pensioners receive retirement income, and most importantly, ensure future taxpayers are not burdened with the fiscal sins of Detroit s past. How long will Detroit have state oversight? What if you do all this and they just spend all the money and go back to square one? There is no definitive end date included in the legislation for when all oversight of the city will cease. It is subject to various conditions and markers of financial viability that must be met to satisfy the bankruptcy court. The Financial Review Commission can enter a period of dormancy only if the city meets a series of rigorous standards for three consecutive years. Total dissolution of the commission would only occur if the city has picture-perfect finances for 10 straight years. No matter how the city performs financially, it will be under oversight of the bankruptcy court for a minimum of 30 years. Responsible Increase in Michigan s Minimum Wage Michigan residents have been clear about what they are looking for from their state legislators: compromise, fiscal responsibility and an improved Michigan economy. The bipartisan agreement we approved today phases in the first increase in the minimum wage in nearly a decade, in a manner that is fair to both employers and workers. Sending the minimum wage to $10.10 would have a devastating effect on our recovering state economy. Employers would not only be forced with laying off employees but could go out of business altogether due to the increased cost of the most basic daily operation

3 of doing business: hiring employees. A lapse in hiring or a lack of investment would eliminate any chance Michigan currently has at making a full economic recovery. The bill we passed is a measured, responsible way to achieve a similar outcome for Michigan workers without a devastating impact on job providers and our economic recovery. We must do more than just say thank you to our Veterans On behalf of Michigan House Republicans, I would like to thank all Michigan veterans for sacrificing so much for our state and country. It is important for everyone to honor those who gave their lives serving our country in the U.S. Navy, Air Force, Marine Corps, Army, Coast Guard, National Guard and Reserves. Along with remembering those who gave their lives fighting for our country, we also must remember those veterans who are still among us. And we also realize it s not enough just to say thank you. Because of their immense sacrifice, veterans deserve to be treated with respect and fairness. As a Legislature, we also need to ensure that veterans have the easiest transition possible into civilian life. These reasons are why the Michigan Legislature will continue to push and bring about common sense, veteran focused legislation that will ensure more than just a thank you is given. Veterans, thank you again for your service to our great state and country. Veterans designation on drivers licenses, state IDs unveiled Honorably discharged veterans this month will be able to add a veteran designation to their driver s license or state ID. The new designation allows Michigan veterans to more easily prove their honorable discharge status and more quickly access benefits and discounts. Veterans can add the designation for free when renewing their state-issued ID or pay a small fee if they wish to add it immediately. Michigan National Guard education tuition help proposed

4 Active-service Michigan National Guard members could receive up to $4,500 a year to help pay tuition fees at in-state educational institutions under legislation recently introduced. House Bill 5451 allows students to pursue vocational or technical training, a certificate, or a first associate degree, bachelor s degree or master s degree. Eligible education institutions include a public and private college or university, vocational school, technical school or trade school that is located in Michigan. The tuition assistance could also be used for instructional fees, laboratory fees, computer fees and other fees directly related to course work, but does not include the cost of books or study materials. The program would be administered through the Michigan Department of Military and Veterans Affairs by the adjutant general, who would have jurisdiction to approve applications based on eligibility and available funding resources. The bill has been assigned to the House Military and Veterans Affairs Committee. Michigan s future looking brighter Michigan recently earned its highest ranking to date in the annual Rich States, Poor States Economic Outlook Rankings. Our state is going into 2015 ranked as the 12th-best state for economic outlook. Based on 15 different state policy categories including personal income tax rankings, debt ratio and sales and property tax burdens the ranking system is a forward-looking forecast of all 50 states. Michigan currently ranks in the top 20 in eight of the categories and the top five in three others. In the last decade, Michigan s economic outlook sunk to a record low 16th-worst in the country, but saw significant increases between 2011 and 2012, when the forecast jumped eight positions. Turning the economy around a MILE at a time After a decade of failed programs and policies during a recession that hit us harder than most, we ve been rebuilding our state for the 21 st century by coming up with pioneering ideas, such as the Michigan Invests Locally Exemption (MILE) program. Public Act 264 of 2013 launched the MILE program to establish a Michigan-based and operated version of the crowdfunding idea, similar to online websites like Kickstarter and Indiegogo. Using the MILE program, Michigan residents can purchase equity in Michigan businesses and create Michigan jobs. The program is a unique approach that creates growth opportunities for investors and our state. For example, if a small business wants to expand to a second location but doesn t have all the capital it needs, a business can use MILE to seek out local investors, who receive an ownership stake in the company.

5 Smarter, smaller government leading Michigan The House has worked tirelessly to ensure Michigan s residents have a government that works for its citizens, while also making sure it is a government that represents its citizens. One such promise was creating a smaller, smarter state government that works more effectively and efficiently. To fulfill that promise we have worked with other state agencies to cut more than 12 percent of all state rules and regulations. In 2011, the Office of Regulatory Reinvention (ORR) was created to help trim the fat. More than 1,500 rules were eliminated, and 100 recommendations were implemented to make the remaining rules and regulations more efficient. In total, almost 2,000 unnecessary, burdensome or duplicative rules have been rescinded. The rules and regulations that once entangled Michigan residents in red tape and bureaucracy and made us jump through unnecessary hoops have been turned into a government that is for and of the people. *If you feel you have received this in error or would like to be removed from our list, please respond "unsubscribe."