Honigman Capitol Report

Governor's Office

Governor Patches Fiscal Year 2027 Budget

Governor Gretchen Whitmer signed a 12-bill package last week to balance key elements of the state’s Fiscal Year 2027 budget. Senate Bill 729 and House Bill 5482 authorize financing and appropriations for approximately $1.3 billion in construction and renovation across 27 public university and community college projects, including laboratories, classrooms, and other facility improvements. Senate Bill 569 transfers revenue collected under the Public Health Code to the General Fund over three years, while House Bill 5109 transfers money from the Transportation Administration Collection Fund to the General Fund. The remaining measures require landlords to offer at least one rent payment option without an added fee, permit electronic security deposit refunds, prohibit insurers from setting rates based on a customer’s perceived willingness to pay, and clarify Medicaid-related restrictions so they do not unintentionally limit certain fertility preservation, travel assistance, or care coordination services. Additional legislation closes the Community District Education Trust, increases online gaming revenue distributions to tribal governments and the Christopher R. Slezak First Responder Presumed Coverage Fund, and redirects available money to the Court Equity Fund for local trial court operations.

Committee News

House GOP and Democrats Priorities Clash

Last week, House Republicans and Democrats sharpened contrasting messages ahead of the Nov. 3 election during a busy session and related committee meetings. Republicans advanced a resolution condemning socialism that passed 58-34, while Democrats criticized it as political messaging and pushed to focus on affordability. Democrats repeatedly sought votes on a 90‑day state gas tax suspension triggered by $5 per gallon prices but were blocked in committee and on the floor. Republicans successfully discharged and passed a bill requiring a prominently displayed U.S. flag of specific dimensions in classrooms, and advanced an ethics bill restricting post‑legislative jobs tied to certain utility grants. GOP leaders framed their actions as substantive accomplishments on schools, ethics, and broader issues, while Democrats argued voters want relief on gas and daily costs.

Election News

Constitutional Convention on the Ballot Nov. 3

Voters will decide on Proposal 1 in November which will determine whether or not Michigan holds a constitutional convention in 2027. A Citizen’s Research Council (CRC) report released last week says a constitutional convention could reopen Michigan debates on abortion, voting, term limits, education funding, taxes, and more. Issues likely to draw attention include stem cell research, affirmative action, same-sex marriage language, death penalty, judicial selection, university autonomy, collective bargaining, redistricting, and tax and spending limits. CRC President Eric Lupher emphasized that approving Proposal 1 only starts the process and the 1963 Constitution remains until voters approve a new one. If Proposal 1 passes, 148 delegates would be elected in 2027, and the convention would convene in Lansing that October without a completion deadline. Taxpayers would fund the convention and elections, and any proposed constitution would require voter approval. Voters last rejected the question in 2010, and if it fails this year, it returns automatically in 2042.

On Point

Client Alert: New Developments Affecting Hospital Merger Enforcement

Looking Ahead

Two proposals are on the November ballot. Proposal 1 would call a convention to revise the state constitution. Every 16 years, the question of whether to call a constitutional convention must be submitted to the people of Michigan. On both sides of the aisle, there are major concerns about what a convention would mean for the state. Democrats are concerned about the erosion or complete elimination of protections for abortion rights, voting rights, and civil rights. On the Republican side, the concerns include a graduated income tax, additional union protections against right-to-work, new environmental protections, and Michigan becoming a sanctuary state for undocumented immigrants. Voters on both sides seem wary of supporting this proposal, and it is likely to fail.

Proposal 2 seeks to eliminate utility spending in elections. Advocates of this proposal believe utility companies have an unfair advantage when they get involved in elections. This initiative appears to be on track for overwhelming support among voters and will likely pass.