Gaylord/Otsego County Chamber of Commerce

Government Relations Update from Jamie Callahan

June 16, 2008

Wrapping It Up for Summer Break

With the legislature scheduled to adjourn on June 26^th for a summer recess, there is a flurry of activity to try and wrap everything up in the last two weeks.

Budgets:This is the top priority for both legislative chambers.They have set a deadline for themselves of July 1^st to have the budgets finished (for an October 1 fiscal year start).Most bills have been sent to conference committee where the final details will get worked out between the chambers.

Water use:Passage of the Great Lakes Compact and the additional water use bills continues to be negotiated.The major points of contention are ones important to chambers of commerce:allowing new business to locate and grow in northern Michigan areas near certain types of streams without limited or overregulated permitting; keeping the personal property rights standard for water use; and basing water use permits off of scientific data.

Individual Market Reform:The House-Senate workgroup continues to meet in an effort to come up with a compromise between the two legislative versions.The group is expected to finish their work prior to the end of June.Amended bills or a conference committee would be the final step in the process.

Electrical Choice:The Senate committee voted out three bills from committee – one on electrical choice, and two dealing with renewable portfolio standards.It is unclear whether the bills will continue to move as a single package or whether the RPS bills will be split off and move independently.

Senate Subcommittee Issues MBT Report

The MBT Impact Assessment Subcommittee was formed by the Senate Finance Committee and charged to gather information on ways to improve the MBT.The subcommittee held hearings across the state, including a stop in Gaylord.Business owners were able to share experiences and frustrations with the tax and discussed ways to provide relief.The recently published report recommended the following as ways to address the MBT:

-Eliminate the MBT surcharge

-Eliminate the collection of taxes from the gross receipts calculation

-Remove bad debts from the gross receipts calculation

-Increase the compensation limit for the Small Business Credit

-Eliminate the cascading effect (service industries see the greatest impact of this)

The report also found that many businesses were seeing steep increases in their tax liability, the information coming out of the Department of Treasury was confusing, and that many businesses and accountants were not aware of the Small Business Credit option.

Legislation has been introduced to address some of these recommendations.The Chamber and
Alliance will continue to advocate for these changes and additional tax reform.If you are interested in receiving a copy of the full report, contact Jamie in the Government Relations Division at Jamie@tcchamber.org.