Legislature misses midnight deadline for avoiding a shutdown but still passes budget agreement

LANSING – They missed the midnight deadline for averting a partial state government shutdown, but it appears after a day of bills funneling back and forth between the Senate and House a shutdown was averted early Monday morning.

Shortly before 3 a.m. Monday morning the Senate voted 19-19 for the conference report for House Bill 5198 to set a sales tax on certain services with two Republicans crossing over and Lt. Gov. John Cherry broke the tie by voting yes. Earlier in the morning two hours earlier the Senate had voted the same way for the conference report for House Bill 5194 that that raised the income tax rate from 3.9 percent to 4.45 percent.

Averting the shutdown took a lot of starts and stops, such as the conference report for the package of bills known as the Public Employees Health Benefit Act bill requiring pooling of health insurance for teachers and other public employees. It barely passed in the House by a vote of 57-52 just minutes after midnight Sunday night/Monday morning. That appeared to be the last piece in the puzzle for an agreement to balance the budget and for the Governor signing a 30-day continuation or temporary budget bill if the Senate passed the revenue bills authorizing the sales tax and the income tax increase.

Things got rolling in the Senate at 9:30 p.m. when it took up bills sent over from the House. Senate Bills 772 and 773 – the all important continuation budget - was passed by a vote of 34-3 that will keep the state government going for 30 days beginning on Monday. The continuation budget bill was previously approved in the House. The other budget bills are tie-barred to the continuation bill, and it took all night and the early morning to get all the pieces in order.

“This is a multi-departmental budget bill, and it includes debt service payments,” said Sen. Ron Jelinek, R-Three Oaks, the chair of the Appropriations Committee.

However, the continuation budget bill was tie-barred to the revenue increases; House Bills 5198 that set a sales tax on certain services and HB 5194. Earlier in the day the House passed HB 5198 that set the sales tax on 23 categories of services. It was approved with a narrow vote of 56-53, with the support of all but two Democrats. The bill provides some $613 million toward this year's $1.8 billion budget deficit.

The Conference Committee, consisting of three members from both Houses, voted 4-2 to approve HB 5194 that raised the income tax from 3.9 percent to 4.45 percent. Shortly before 11 p.m. the House passed the bill by a vote of 57-52 to kick it over to the Senate. Rep. Chris Ward, R-Brighton, and Rep. Ed Gaffney, R-Grosse Pointe Farms, were the only Republicans to vote for the bill. Ironically, Ward was on the conference committee and cast one of the two no votes.

The Senate also passed unanimously a series of reform bills aimed at improving government efficiency in exchange for some Republicans supporting the revenue increases. Senate Bills 396, 396 and 397 were passed that creates a Commission on Government Efficiency. The commission would conduct a comprehensive reviews and analysis of state administrative functions and mandates imposed upon local units, and the commission would recommend potential cost-saving reforms to the Legislature.

SB 549 was passed unanimously to implement a uniform school calendar for all public school districts. The rationale is there will be a monetary savings if it is easier to share program and services if they are all on the same calendar. SB 632 would allow products made by prisoners through Michigan State Industries (MSI) only be sold to non-profit agencies and tax-exempt agencies.

A major reform that was passed unanimously was House Bill 4800 that ends the so-called “double dipping.” It amends the State Employees' Retirement Act to suspend pension payments of a retiree under the act if the individual is reemployed by the State of Michigan directly or indirectly. The House substitute for SB 622 was passed 22-16 that will allow the Michigan Department of Corrections to privatize the corrections mental health program by allowing them to contract with "third-party providers."

Most of the Michigan’s media was for the first time in a long time focused on the Capitol, and Detroit and Lansing area TV stations were conducting live interviews and reports on both the House and Senate floors. However, Senate Majority Leader Mike Bishop, R-Rochester, had the Senate Sergeants-At-Arms order the assembled media not to photograph or film the vote board when votes are taken to give the bills immediate effect. Those votes are not recorded anywhere or appear in the Senate Journal, so a photo or video of the board would be the only record. The rules that govern the Senate say nothing about what the media can or cannot shoot once they are given permission to film or photograph on the Senate floor.

This is not the first time Bishop has been accused of censorship. Last August he received a firestorm of criticism for attempting to block access from Senate computers to the blog "Blogging for Michigan" that had been critical of his handling of the budget situation. Only after he received criticism from both sides of the political spectrum did he relent and change his position.