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MIRS Weekly Report

Michigan News And Capitol Report, Week Ending Friday, February 16th, 2024

 

Environmental Hazards Flagged As Reason For Polluter Pay

An electroplating chemical spill in Warren’s Bear Creek drain and the spotting of a “mysterious corrosive ooze” seeping out of the ground of a former steel facility in Riverview were propped up as examples Thursday by environmentalists and local officials as reasons for new polluter pay laws in Michigan.

In Warren, Councilmember Hal Newnan called the “preventable” leaking of 580,000 gallons of toxic wastewater into Warren's Bear Creek as something that should be “an alarm at the highest levels.” 

Overall, more than 24,000 contaminated sites need attention in Michigan and many are not being cleaned up quickly, said Grosse Ile Township Trustee Kyle de Beausset. Ooze has bubbled up near Riverview Trenton Railroad’s recent construction on the northern portion of the former McLouth site for nine months. de Beausset fingered the Maroun family as being responsible, but nobody has taken responsibility.

“The system is rigged for polluters and we need better laws to both encourage cleanup and hold polluters accountable when they hurt our communities like this,” he said. “Thankfully, our local state lawmakers are champions of better polluter pay laws, and I’m hopeful they’ll lead our state government to act quickly and better protect communities like ours from pollution.” 

McLouth Waterfront Alliance’s Ryan Stewart, Michigan Sierra Club’s Christy McGilliray and the Michigan League of Conservation Voter’s Bentley Johnson were the featured speakers at the Trenton event. 

The manufacturing industry has opposed these types of bills because they would require a costly, extensive cleanup to a level of mediation may that may not be necessary for the project being considered. For example, if a developer wants to build a solar farm on a brownfield site, “polluter pay laws” would require state and new developers to clean up the property as if a neighborhood was being placed there. 

A Michigan Manufacturing Association (MMA) official spotlighted a scenario such as this, in which the current Part 201 program had the developer paying $250,000 to clean up a site well enough to put electricity-generated solar panels on it. Environmentalists are asking for a standard that would drive up costs to $1.25 million. 

If the bills the environmentalists are advocating are  SB 605, SB 606  SB 607, SB 608, SB 609, SB 610 and SB 611, Caroline Liethen, MMA's director of environmental and regulatory policy, said orphan sites like the former McLouth site and the Bear Creek situation don't apply, anyway.

The fact is, a person found responsible for polluting a property in Michigan is already required to pay for cleanup. The issue is abandoned orphaned sites where state money is needed for cleanup because the responsible party is long gone and can't be tracked down, she said.

“Polluter pay is a bit of a misnomer,” she said. “In fact, those bills could have a chilling effect on brownfield redevelopment” because developers may pull out due to cost, causing abandoned, polluted property to sit longer.

 

Pre-Registration For Construction, Energy Project Contractors Put On The Table

A Sen. John Cherry (D-Flint) bill requiring contractors and subcontractors to register with Michigan's labor department before bidding on state construction and demolition projects, as well as solar or wind energy projects, was considered Thursday morning.

"It modifies the new prevailing wage statute to require registration of contractors and subcontractors who are going to be working on state prevailing wage projects, and requires the submission of the certified payroll that they're required to maintain to (the state's Department of Labor and Economic Opportunity (LEO))," Cherry said to the Senate Labor Committee – which he chairs – on his SB 571. 

A win for labor unions in 2023 was the Governor signing HB 4007, requiring contractors and subcontractors for state projects – like those related to public buildings, highways and school upgrades paid for wholly or partly by state funds – to pay their laborers prevailing wages and fringe benefits similar to what workers are being paid in the area following their own collective bargaining agreements. 

Failure to do so would result in LEO assessing a business for a civil penalty of up to $5,000 for each violation. 

Similarly, when Democratic legislators submitted their 100 percent "clean energy" by 2040 package to the Governor in November, the ensemble of bills required the Michigan Public Service Commission to verify workers for utilities' energy projects were being compensated with prevailing wages and fringe benefits. 

Under SB 571, contractors and subcontractors aiming to secure a bid for one of the aforementioned projects, ranging from painting a state-owned facility to installing a large-scale solar panel farm, must submit a registration application to LEO beforehand.

The department is advised in the legislation to determine an application fee, and the subcontractors and contractors must provide LEO-approved documentation ensuring they possessed all necessary licenses, certificates and registrations. 

SB 571 details that legislation would be valid for one year. Moreover, in April 2025, LEO would need to have a database, which would be publicly viewable online without a cost, displaying contractors' and subcontractors' hourly overtime wage rate for projects, hourly fringe benefit rate, daily starting and ending times for laborers and gross wages paid in the pay period. 

The legislation was opposed by one of the most vocal proponents of Democrats' 100 percent "clean energy" by 2040 package, the Michigan Energy Innovation Business Council (Michigan EIBC). 

In a letter submitted to the committee, Michigan EIBC President Laura Sherman shared that her organization believed payroll records should not be made publicly available for privacy reasons. 

She added that while prevailing wage mandates should apply to large-scale energy projects, like wind projects with a more than 100 megawatt (MW) capacity and solar projects with a capacity greater than 50 MW, her group was "especially concerned that these requirements should not apply to small residential and commercial solar projects." 

However, the Michigan EIBC would not be opposed to SB 571 being amended to require energy projects with a 2 MW capacity or more to pay prevailing wages. 

During the committee meeting, Michael LaFaive of the Mackinac Center for Public Policy relayed a 2023 statistical analysis conducted by Michael Hicks, the director of Ball State University's Center for Business and Economic Research in Indiana. 

LaFaive highlighted how Hicks' study found that from 2004 through 2019, prevailing wage laws raised the price tag of "quality-adjusted road construction" by between 8.5 percent and 14.3 percent, translating to a $5,800 and $9,200 per mile cost in Michigan. 

Additionally, LaFaive wanted to recognize that "wind and solar are not roads, obviously there's a little apple-to-orange comparison there." He said the projects are not financed by the state in any way, suggesting that Cherry's bill goes beyond conventional prevailing wage mandates by necessitating higher minimum wages on a particular industry. 

"But the economics are the same in so far as they rob many taxpaying Peters to pay a handful of union shop Pauls," he said. "This is not just fundamentally unfair to those who pay the bills of government, but to those non-union laborers who may have benefited from their boss winning a bid to do this work." 

Meanwhile, Aaron Pangborn, the business manager of a Lansing-based International Brotherhood of Electrical Workers chapter, said requiring leveled wages to be paid to construction workers removes the incentive for contractors to underbid jobs through cutting wages and hiring a low-skilled workforce. 

Also, he indicated that SB 571 does not expand the scope of policies approved last year, but provides "mechanisms or oversight and enforcement," which he said is "a necessary component of any law." 

 

RNC Recognizes Hoekstra As Rightful MRP Chair

Alleged Michigan Republican Party (MRP) Chair Pete Hoekstra has been recognized by the Republican National Committee (RNC) as the duly elected chair of the party.

MIRS has learned that the RNC Committee on Contests ruled that it is its belief that disputed Chair Kristina Karamo was removed as chair and it was recommended to the RNC Executive Committee to ratify Hoekstra as chair. The executive committee unanimously ratified Hoekstra as an RNC member as chair of the MRP.

The RNC and former President Donald Trump have both recognized Hoekstra as chair of the MRP. When Karamo was elected last year, her opponent, Matt DePerno, had earned Trump’s endorsement and Karamo still won. 

Hoekstra is calling for Karamo to step down and “end her misinformation campaign.

“We are ready to execute. We must put our nose to the grindstone over the next several months and focus on party unity to secure a red-wave victory in November,” he said. 

For her part, Karamo put out a video claiming that RNC Chair Ronna McDaniel confided in her that she is still, legally, the chair of the Michigan Republican Party and that the RNC has no authority to override the precinct delegates or the State Central Committee.

Karamo said that “as you pull back the curtain more and more,” you can see there was a well-funded effort to sabotage the constitutionalism at MRP.

In a statement, the Karamo-led MRP reported that “It's business as usual for the Michigan Republican Party, as we look forward to engaging our fellow Republicans at the 2024 MIGOP District Convention in Detroit on March 2.”

Chairwoman Karamo provides valuable insights that will soon come to light. pic.twitter.com/GHjlt4jRwK

— Michigan GOP (@MIGOP) February 15, 2024

In response to Wednesday's news, the Democratic National Committee's Rapid Response Director, Alex Floyd, said “Most people wouldn't want a job that involves taking over an organization on the verge of bankruptcy that has become a national laughingstock for its failed record. But the Michigan GOP is such a disaster that Republicans are currently fighting over which ultra-MAGA extremist gets to chair their dumpster fire of a state party after Donald Trump led them to back-to-back losses at the ballot box – a trend that doesn't look like it's changing any time soon.”

 

Tipping Fee Increase Top Line Of EGLE Budget Presentation

A top line of the Department of Environment, Great Lakes and Energy’s (EGLE) budget presentation before the House Appropriations Subcommittee focused on landfill tipping fee increases, which would bring in an additional $80 million and create 36 full-time jobs. 

EGLE Director Phil Roos said the budget change is a central funding element for the department’s basic regulatory role and functions surrounding drinking water, contaminated sites and waste management. 

Under Gov. Gretchen Whitmer’s recommendation, tipping fees would be increased from 36 cents per ton to $5 per ton, which Roos said would bring Michigan closer to the Midwest average of around $5 per ton. 

“It's not like we're going out on a limb here,” Roos said, “but it's to have a level playing field, so we're all working against the same numbers.” 

He said raising tipping fees in line with other states is also likely to remove the big incentive for folks in other states and Canadian provinces to dump trash in Michigan landfills. 

Roos said Michigan ends up paying the ultimate cost, with lower tipping fees resulting in more contaminated sites across the state that stem from more waste. 

Additional funds raised by increasing fees would fund a variety of contaminated site cleanups, he said, including orphan site and brownfield redevelopment grant funding, loans to facilitate responsible reuse and recycling and hazardous waste inspections.

New revenue would be expended in accordance with the Renew Michigan Program’s statutory purposes: environmental remediation and brownfield redevelopment, recycling and solid waste programs. 

Rep. Bill G. Schuette (R-Midland) asked if Michigan residents and businesses would be shouldering the cost of this “more than 1,000% increase" if the fee increase were successful in dissuading out-of-state businesses from using Michigan landfills.

Roos said even if every dollar of the fee were passed along entirely to Michigan residents, it would translate to a cost increase of about $15 to $20 a year for the average family.

An advantage would be that the state would have better control of the waste coming into the state.

A Whitmer briefing memo shared last week included info that 75 percent of the $80 million raised would go to contaminated site clean-up and brownfield redevelopment, and state-restricted Economic Siting funds to increase the lifespan of Michigan landfills. Another 13 percent would go to recycling initiatives and 7 percent would go to landfill operations.

The memo does not specify how the remaining 5 percent would be spent.

Roos said that while EGLE has made substantial progress towards site cleanup across the state, it’s a big task to take on, with 24,000 contaminated sites out there needing attention. 

In recent years, he said EGLE has gone from cleaning up around 350 sites a year to around 750, and additional funding in 2024 allowed the department to focus on the biggest and most immediate-risk contaminated sites. 

“We’ve done a lot of work in prioritizing the sites so that we can make those determinations with limited dollars,” Roos said. “What we’re looking for is an opportunity to make a dent in the next level of sites, but those that are the highest risk take the most time, and with a little bit more funding and resources to make this happen, I think we can start to break into a whole other tier that can be done very quickly, and you get really started making a dent in those numbers.”