The Year in Politics 2020 • Looking into Michigan's Future

The Ongoing Travesty of ‘Line 5’

For over seven years now the battle to shut down the dangerous Line 5 Oil Pipeline running between the Straits of Mackinac has been mired in a tangled web of legal battles and 2020 witnessed ongoing delays in this battle between Big Business and the sanctity of Michigan’s precious water resources.

On November 13th of this year, Gov. Gretchen Whitmer revoked Enbridge’s authority to operate its Line 5 pipelines in the Straits of Mackinac. But as was reported in Bridge Magazine, the shutdown of Line 5 is once again uncertain. Citing violations of a 1953 easement that gives Enbridge permission to operate its petroleum pipeline in the Straits of Mackinac, Whitmer announced that Enbridge must shut the pipeline down by May

However, legal experts warn that while Whitmer has the upper hand in court with her new lawsuit to shut down Line 5, oil could keep dangerously flowing through Enbridge’s Straits of Mackinac pipeline beyond that date. Indefinitely. Yep. You read that right.

A delay by the courts to act decisively on Whitmer’s request to declare her November 13 Line 5 shutdown order valid and enforceable is a victory for Enbridge. It means the Canadian company will keep profiting from transporting oil through its pipeline that threatens the Great Lakes. And delay is no friend when it comes to the daily threat and consequences of a Line 5 rupture in the Straits.

While we can’t predict legal outcomes, this legal delay is worrisome, especially given the seven-year battle to protect the Great Lakes and Michigan from the ramifications of Line 5.

Although the Pandemic has over-shadowed and distracted our attentions, it is now more important than ever to keep the spotlight on Enbridge’s failures and lies, and public pressure on the government. Especially now when state and federal regulators are considering permits for a tunnel that would allow Line 5 to keep operating in the Straits for 99 more years.

‘Clean Michigan Slate’ Allows Automatic Felony Expungement

Hundreds of thousands more Michiganders will become eligible to have their criminal records wiped clean under legislation signed into law by Gov. Gretchen Whitmer on October 12th.  Research indicates the package will have a sweeping impact on people who often struggle to get better jobs, higher wages and secure housing as they carry a criminal record despite years of good behavior.

“For too long, criminal charges have created barriers to employment, barriers to housing and others for hundreds of thousands of Michiganders. These bipartisan bills are going to be a game-changer,” Whitmer said.

The multi-bill package passed both chambers of the state Legislature with bipartisan support. While it’s not clear how many more people will be eligible for record clearing under the new law, some have estimated it will more than double the existing eligibility poll.

The most significant bill is the Clean Slate legislation, which would automatically clear records of those who don’t commit another crime. Now, people have to apply to have records clean in a process that is often costly and confusing.

Researchers at the University of Michigan found that only 6.5 percent of people successfully expunge a conviction from their record within five years of becoming eligible. However, beginning two years from the date it was signed, the Clean Slate law will expunge misdemeanors seven years after sentencing and felonies 10 years after sentencing or when they’re released from incarceration (whichever comes later).

Under the new law, people will be able to get up to two felonies and four misdemeanors automatically cleared. Crimes punishable by more than 10 years in prison, violent crimes, “crimes of dishonesty” such as forgery, human trafficking and other serious crimes aren’t eligible.

The Clean Slate law makes Michigan a nationwide leader in expungement reform. Only Utah, California, Pennsylvania and New Jersey allow low-level offenses to be automatically cleared from records, and Michigan will now be the first to include low-level felonies in the automatic process.

The State of Michigan’s Budget

The $2 trillion CARES ACT aid package passed back in March rippled across the economy, bolstering laid-off workers with expanded unemployment; small businesses with Payback Protection Program loans that could turn into grants, and local governments with $150 billion to maintain steady budgets.

While Michigan benefitted from these measures, a $2.7 billion shortfall is expected in Michigan’s budget for fiscal year 2021 and another $2.4 billion in fiscal 2022, assuming some federal aid it awarded to offset lower income tax collections, corporate income tax, and sales and use taxes engendered because of the COVID-19 pandemic.

According to Gabriel Ehrlich, director of University of Michigan’s Research Center for Quantitative Economics, “ “Without more aid from the federal government, we’re going to be in serious trouble here in Michigan.  We would expect school systems, health care systems and local governments to be forced into furloughs [of employees] and likely layoffs if we don’t see more federal aid.”

“That means teachers, police officers, firefighters and nurses who are going to be at risk of losing their jobs,” he said. “It would be bad for the economy and bad for communities.”

This year’s $62.8 billion budget took effect on Oct. 1. It included $250 million in targeted cuts, many of which were related to health care savings from the federal government. At the time, officials said, the state’s rebound  from COVID-19 and federal assistance helped Michigan avoid  what once looked to be a $3 billion budget hole.

Over the next two years, Michigan can expect less income tax withholding from unemployment benefits that were increased by temporary federal payments of $600 for weeks. New stimulus, Ehrlich said, is likely to include less money for jobless workers. Business taxes also are projected to fall, with corporate income tax returns dropping from a 9.8 percent decline this year to a 12.2 percent drop in 2021. Overall business tax revenue will drop by 20.5 percent next fiscal year.

The U-M economist group has been doing state economic forecasts since 1973, with an error rate in recent years of zero or close to it, except during the Great Recession. 

The 2020 forecast was rocked by coronavirus. Ehrlich looked back to what he and his colleagues predicted as  “slow and steady growth” for 2020, and noted with some understatement that “things haven’t turned out quite that way.”

The year should have seen 0.7 percent growth in employment, but instead it fell 9.2 percent. Yet even that seems like a win for the state, which saw at least 40 percent of its workforce affected by some form of job disruption since mid-March and paid out more than $25 billion in jobless benefits.

“It could have been a lot worse,” Ehrlich said, “given what’s happened with employment in Michigan.”

After an audit revealed that the state lost $1.5 billion in fraudulent Unemployment Insurance Agency (UIA) claims, state Senator Ken Horn issued the following statement: “The governor has agreed with the Legislature that we need to find millions of dollars to assist struggling families after nearly half a million paychecks come to a screeching halt just before Christmas. It is the intent of my subcommittee to recover the $1.5 billion so that we can deliver these dollars to the people who need it the most.”