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May 29,2020 

Government Affairs Update

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Here is your newest Government Affairs Update! 

Emergency Authorities & COVID-related Legislation

Legislation

The Michigan House of Representatives has yet to take action on Senate Bill 690, which provides $523 million in supplemental appropriations for Fiscal Year 2020 from the federal coronavirus relief fund for various purposes, most notable of which is the inclusion of a $3/hour increase for direct care worker wages. We can likely expect the supplemental to move the first week of June.

 

Executive Order

Stay Home, Stay Safe

On Thursday, May 21, Governor Whitmer announced that she signed another iteration of the Stay Home, Stay Safe order – Executive Order 2020-96 – reaffirming the measures set forth in the previous order but taking the following new actions:

 
  • Repeal of Executive Orders 2020-17 and 2020-34, which imposed a prohibition on elective dental, medical and veterinary services statewide, beginning on Friday, May 29 at 12:01 a.m.

  • Allowing statewide reopening of auto showrooms, by appointment only, on Tuesday, May 26.

  • Allowing statewide retail, by appointment only, starting on Tuesday, May 26. Stores will be limited to 10 customers at any one time.

  • Allowing statewide gatherings of 10 people or less are allowed, but necessary health and safety measures should be used.

 

On Friday, Governor Whitmer issued Executive Order 2020-100 extending the state’s Stay Home order set forth in 2020-96 until June 12, 2020 at 11:59 p.m. The new order extended several other executive orders until the newly-issued (or any subsequent) state of emergency and disaster declaration – 2020-99 – expires on June 19, 2020 at 11:59 p.m. One of the extended orders was Executive Order 2020-64, which seeks to address discriminatory actions in the context of medical care delivered during the state of emergency

 

Executive Authority Lawsuit

Judge Cynthia Stevens issued a ruling in the Michigan Court of Claims on Thursday, May 21 in Michigan House v. Whitmer upholding the Governor’s authority to declare a state of emergency under the Emergency Powers of the Governor Act of 1945. However, the judge also ruled that the Governor could not declare a state of emergency and disaster declaration under the Emergency Management Act of 1975 without legislative intervention.

 

On Friday, May 22, Michigan House and Senate Republicans filed a request for an emergency bypass to take their case to the Michigan Supreme Court, rather than going through the Court of Appeals. As of this writing, no further action on the lawsuit had unfolded.

 

Fiscal Year 2020 Appropriations Cycle and FY 2021 Budget 

Since actual revenue for Fiscal Year (FY) 2020 is falling below anticipated, as was indicated during the May 15 Consensus Revenue Estimating Conference (CREC), the Michigan Constitution requires the Governor to reduce discretionary expenditures by Executive Order with the approval of the House and Senate Appropriations committees. While House and Senate appropriators have stated publicly that they would like the deliberations around reductions to begin as soon as possible given there are so few remaining months left in FY 2020, the Governor has emphasized the critical need for federal relief to states, the fate of which remains in flux (both with respect to loosening restrictions on already allocated coronavirus relief funds and another round of stimulus). Both the Governor and Senator Majority Leader have alluded to holding K-12 school funding harmless.

 

It is worth noting that the actual costs of the Medicaid program fell below projected in the first half of 2020 due to the temporary 6.2 percent increase of the Federal Medicaid Matching Rate (FMAP) under the Families First COVID-19 response legislation (P.L. 116-127). While the 6.2 percent increase is set to expire at the end of June, the Heroes Act that passed the U.S. House of Representatives included a 14 percent increase beginning July 1, 2020 through June 30 2021, which if signed into law would go along way to helping support the state’s growing caseload and could help mitigate universal budget pressures.

 

Despite various unknowns and the need for a first-ever August Revenue Estimating Conference, internal deliberations around the framework for the Fiscal Year 2021 budget are underway. And while appropriators are motivated to move forward on budgets, they may not have enough information to deliver a Fiscal Year 2021 budget to the Governor’s desk by the July 1 statutory deadline, at least with respect to the General Omnibus budget. An attempt to finalize a School Aid Fund budget prior to July 1 is more likely but still uncertain.

 

Legislature’s Schedule

The House and Senate are adjourned until Tuesday, June 2. We can anticipate the legislature continuing to ramp up committee and floor activity in the coming weeks. Much of the legislature’s focus will be on finalizing existing non-controversial items, COVID-related legislation and any action on the current Fiscal Year 2020 budget and construction of the upcoming Fiscal Year 2021 budget.

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