Bills on unfunded mandates return in Michigan House

After a similar proposal died in the Michigan House of Representatives during the last legislative session, when that chamber was controlled by Democrats, state Reps. Eileen Kowall (R-White Lake, Highland) and Gail Haines (R-Waterford, West Bloomfield) have reintroduced a string of bills that would require the state government to appropriate funds to pay for so-called “unfunded mandates” placed upon local governments.

House Bills (HBs) 4038 through 4041 have been referred to the House Government Operations Committee, where they await a hearing.

Unfunded mandates occur when the state government enacts laws or administrative rules that require local governments — school districts, community colleges, intermediate school districts, cities, villages, townships, counties, and authorities — to provide a new activity or service without allocating funding to pay for those services or activities.

Under the Headlee Amendment to Michigan’s 1963 Constitution, the state is “prohibited from reducing the state financed proportion of the necessary costs of any existing activity or service required of units of local government by state law. A new activity or service or an increase in the level of any activity or service beyond that required by existing law shall not be required by the Legislature or any state agency of units of local government, unless a state appropriation is made and disbursed to pay the unit of local government for any necessary increased costs.”

Despite this constitutional provision adopted by Michigan voters in 1978, the state government occasionally enacts unfunded mandates for local governments — sometimes unintentionally.

Under the new legislative package, a new activity or service, or an increase in the level of any activity or service beyond what is currently required under state statute of a local government by a state agency rule, regulation, bulletin or directive would be prohibited unless the state Legislature appropriated funds and a disbursement system was been established to pay the affected local units of government for any necessary increased costs.

One of the bills seeks to set up a legislative process whereby the state government considers the fiscal impact of state government action on local units of government, according to Kowall. A local government mandate advisory panel would put together “fiscal impact statements,” and the panel “would be able to pull together some estimates on what costs (are associated with various state government actions), and then advise our fiscal agencies of that,” she said.

“The same thing would be true of administrative rules,” Kowall said.

The panel would be comprised of the directors of the House and Senate fiscal agencies or their designees; the director of the Department of Technology, Management and Budget, or his or her designee; and representatives of groups representing the interests of counties, cities, villages, townships, school districts and intermediate school districts, and community colleges.

Although a similar package of bills was unsuccessful in being enacted during the last legislative session, Kowall said she is “definitely a lot more hopeful” that the new package will be met with greater support now that Republicans hold the state House of Representatives and the governor’s mansion, unlike when they were introduced last time.

“The issue with the unfunded mandates is, ‘Is any legislation that is being proposed or passed going to cost a local government money?’” Haines said. “If it is, where is the funding coming from? When local government is trying to make due with less, I think it’s important (to consider that).”

State Rep. Bill Rogers (R-Milford) said that, when the issue came up during the last legislative session, he was supportive of the bills and this session he will continue to be “on board with it.”

“The (Michigan) Constitution says that we can’t do it. I am totally backing those bills,” he said.

State Rep. Chuck Moss (R-Orchard Lake) said he may throw his support behind the bills, too.

“If you are going to pass a bill that forces every locality to have a dog park, but (the local municipality has to) pay for it, what’s it going to cost the locals? It’s about us disciplining ourselves (in Lansing),” he said.

State Rep. Lisa Brown (D-West Bloomfield, Commerce, Wolverine Lake) couldn’t be reached for comment prior to press time.