Honigman Capitol Report

Governor's Office

No Meeting of the “Leadership Triangle” for over a Month

Since July 1, there have been no face-to-face meetings between Governor Gretchen Whitmer, Senate Majority Leader Winnie Brinks, and House Speaker Matt Hall regarding the Fiscal Year 2026 budget, despite ongoing individual meetings and daily staff interactions. Speaker Hall confirmed that the leadership "triangle" has not convened in the last five weeks, although there are ongoing parallel discussions with the Governor and Senate Majority Leader Brinks. Brinks' office also acknowledged continuous discussions at various levels concerning the budget and other legislative matters. The main issue is the lack of clarity on negotiation points, as the House has not passed a general government spending budget for FY 2026, leaving questions on funding a $3.1 billion road plan and tax cuts without raising revenue. Hall criticized the Senate Democrats' budget, which was based on outdated January revenue projections, and highlighted the potential $1.1 billion in additional cuts due to the federal "One Big Beautiful Bill" signed by President Trump. Hall expressed skepticism about the current budget's feasibility, comparing it to an unrealistic $100 billion budget proposal. He mentioned that subcommittee chairs are working on FY '26 spending plans, expected to be released soon, although no specific timeline was provided. Hall aims to finalize the budget by September 30, the end of FY '25, and suggested that a full compromise could be reached quickly if legislative Democrats empowered Governor Whitmer. There are 55 days remaining until the deadline.

Committee News

Legislature on Track set record on Fewest Bills sent to Governor

The Legislature is on its way to sending the fewest number of bills to the Governor since the founding of the state. House Speaker Matt Hall at a press conference last week is unconcerned with the distinction. When asked what would classify as a successful session, Hall highlighted signing a FY 2025 budget deals, passing no taxes on tips, a Public Safety Trust Fund, education reform and changes to social programs. Hall stated he would be content if these priorities were achieved with only 25 to 30 public acts, marking the smallest number in state history for a regular session. While Hall expressed appreciation for Governor Whitmer's proposal to have the Auditor General oversee legislative earmarks and set a hard cap on approved earmarks,  he noted that House Democrats, with some exceptions, are not participating in subcommittee hearings discussing these earmark requests. Hall has informed Democrats that non-participation in public hearings would result in their requests not being considered in the House budget. Additionally, he considers nine bills left over from the 102nd session as "dead" unless a court rules otherwise, following the passage of HR 41. A future project for the House Republican caucus is to rewrite the state's energy bill to eliminate the requirement for electricity providers to run 100% on clean energy by 2040. Hall emphasized the need for policies prioritizing reliability and affordability, including repealing the solar siting law. He expects the end of tax credits for renewable energy projects to slow the proliferation of solar panels and wind turbines. Hall deflected questions about potential turmoil within his caucus after some members missed a session, allowing Democrats to block a bill on student cell phone use.

Election News

Majority of Local Proposals Pass

In the recent Michigan local elections, 84% of the 95 money-related local ballot proposals passed, with only 15 failing, indicating a general approval for local funding initiatives. However, bonding proposals were evenly split, with four of the six largest requests failing. Notably, the largest bonding requests from Romulus Community Schools and the Livonia Fire Department, seeking $153 million and $150 million respectively, were rejected. In contrast, a $49.225 million bond proposal in the Holland City School District was approved, while a $45 million proposal for Copper County ISD and a $32 million request for a new jail in Houghton County were not. Several school bonding proposals in districts such as Fitzgerald Public Schools, Bath, and Novi were successful, but others, including those in Au Gres-Sims and Armada, failed. Among the 11 millage increase requests, three failed, specifically two for parks and recreation and one for public safety in Muskegon County. Of the 30 millage renewals, only two did not pass, affecting Meridian Township senior services and Shiawassee Township fire services. One of the four sinking fund requests failed, which was in the Grant public schools. Millage restorations had a 100% success rate, and both proposed millage decreases and their corresponding increases were approved. In other categories, two of 25 fire-related questions and two of five park and recreation increases failed, while all EMS and general government proposals passed. Libraries had a high success rate, with only one bonding request failing, and senior services had a 50% success rate. Six of 27 school-related questions failed, but road ballot questions were unanimously approved. Public transportation and recycling questions were also successful. Menominee passed a recreational marijuana ordinance, allowing nine retailers, and Lansing Township extended the operation of its municipal utility for 30 more years.

On Point

Client Alert: Recent Executive Orders Affecting Imports

Looking Ahead

The primary election for Detroit Mayor occurred Tuesday, August 5 with current Council President Mary Sheffield and local pastor Solomon Kinloch advancing to the general election. Both candidates have significant name recognition, however, Sheffield secured more than 51% of the vote. Kinloch’s total of 17% was the second highest vote getter of the eight-person field.

Heading into the November election, this is the first open race for Mayor in 12 years following Mayor Mike Duggan’s decision not to seek re-election and instead mount an independent candidacy for Governor. If elected, Sheffield will be the first woman Mayor of Detroit. Significant challenges await the next Mayor including the ending of the bankruptcy grand bargain agreement, the conclusion of American Rescue Plan Act (ARPA) dollars, and an uncertain economy.