Friday, March 14, 2014

Michigan Democrats trump Republicans' pothole proposal

If you used poker terms you might say that the Democrats saw the Republicans’ offer to spend $100 million repairing  Michigan potholes and raised it  $115 million, for a total proposal of $215 million.

The Republicans have not been spared criticism in this quarter so it is only fair to point out that Democrats somehow always want to spend more when it comes to government.

They want more money for schools and higher education, big-ticket items in Michigan’s budget. Now more money for roads.

More spending will lead to more taxes, however — something they are not campaigning for in the current election cycle.

Oh sure, they accuse Gov Rick Snyder and the Republican-held legislature of cutting taxes for businesses and raising them on individuals. That’s accurate. The only assumption that can be made is Democrats want to go back to the policies of the Granholm era and that while they may reverse tax increases on senior citizens and others, they will raise them on businesses. What else are we to conclude?

Michigan voters have a clear choice in this November’s election. They can judge whether lower business taxes have generated economic activity — most importantly jobs — or whether the improved business climate has nothing to do with taxes.  That’s a plausible assumption, according to a recent study by the Michigan League for Public Policy.

In any case, voters’ decisions should be fairly simple, at least based on the issues.  

Wednesday, March 12, 2014

Study says Michigan can afford more renewable energy

 Moderate adjustment of  energy policies can help Michigan triple its portion of production from renewable sources by 2030 without sizeable rate hikes, according to a new report.

The Union of Concerned Scientists  said that continuing to ramp up renewables at the same growth rate as the current renewable energy standard —1.5 percent per year — could boost its in-state renewable energy portion to 32.5
percent of total energy production in 2030.

The state is expected to have no trouble meeting a 10 percent renewable energy standard by 2015. That’s the goal that the state legislature established in 2008. The RES expires at the end of next year so the legislature is expected to set new goals. The Senate Energy and Techology Committee held hearings this week and last and has another one scheduled for next Tuesday.

“The Michigan Municipal League advocates every day for policies that will help our communities provide better basic services and create vibrant communities, and that’s why we’re encouraged by the findings of this report,” said Samantha Harkins, the league's director of state affairs. “We’re looking forward to working with the legislature this year to increase our renewable energy standard.”

Increasing renewables would come at virtually no increase in electricity costs, with consumers projected to pay just 0.3 percent more over the next 15 years, the UCS report said.

Part of the reason is that the costs for renewable sources like wind and solar have declined.

“Michigan’s overreliance on coal has significant negative health impacts on our children, seniors and families,” said Rory Neuner of MI Air MI Health. “This report by the Union of Concerned Scientists should be a call to action for the Michigan Legislature. Transitioning from coal to clean energy will reduce asthma and lung disease complications and ultimately save lives.”

“Further diversifying Michigan’s electricity mix with renewable energy fits squarely with Governor (Rick) Snyder’s goals of an affordable, reliable and adaptable electricity system that also protects the environment,” said Sam Gomberg, a UCS energy analyst and the report’s author. “And we can do it while driving investments in Michigan communities.”

Advocates of a higher standard say would inject more than $9.5 billion in new capital investment into Michigan’s economy between 2016-2030. Such investment would also generate millions of dollars in new tax revenue, expenditures on facility operation and maintenance, and wind power land lease payments for local communities, they say.

The onus for meeting 2015 RES goal was placed on the incumbent utilities, which agreed to the renewable requirement in exchange for moving the state from a deregulated energy system to a hybrid system.

The 2008 legislation — Public Act 295 — established a 10-percent energy competition restriction because utility  leaders said they needed a stable customer base to meet the renewable goals and incur an expense they say has reached $4 billion to invest in wind and solar.

Now, electric deregulation advocates are saying rates would be lower in a deregulated environment. Historically, Michigan’s electric rates are usually at the national average or above it, according to the Michigan Public Service Commission.

These are among the issues to be settled by the legislature. A compromise with broad support among Democrats and Republicans was the result in 2008.  Hopefully something that benefits all ratepayers will emerge this time as well.

Tuesday, March 11, 2014

How should America view retirement?

The Wall Street Journal had a great piece on America’s philosophy on retirement if you can get through the publication’s pay wall to view it. (WSJ: America needs to rethink 'retirement'.)

It basically says that if the nation taps into its older people as a workforce it will stimulate economic growth.

That’s all well and good if we are define the benefits of retirement in strictly material terms. But how about a more — shall we say — spiritual definition?

Many senior citizens use their retirement to educate themselves, through reading, film, television, cruising the Internet, gardening, golf and traveling. Some seek to get closer to God. Lest all of these activities sound self-centered, that would be a narrow way to view them. Don’t such pursuits make senior citizens better parents, grandparents, neighbors, church or synagogue members or volunteers?

And the so-called economic benefits mentioned in the article may never materialize. There’s one thing about facts, figures and projections: Sometimes human behavior gets in the way and functions in counterintuitive ways.

At any rate, it is all good food for thought.

Monday, March 10, 2014

Home health care in jeopardy?

Cuts in Medicare spending for home health care jeopardize senior citizens, according to advocacy groups.

The February jobs report released by the Bureau of Labor Statistics last week represents the single highest level of monthly job loss in the home health sector in more than a decade, reports the Partnership for Quality Home Healthcare.

According to the BLS report, 3,800 home health jobs were lost in February. Advocacy groups say this decline is a direct result of the 14 percent Medicare cut the Obama Administration began implementing  Jan. 1 as part of the Affordable Care Act.

The cuts will do "irreparable damage to recipients of Medicare's home health care services, those who are aged, homebound and sicker than the average Medicare population. Indeed, nearly two-thirds of Medicare home health care users live at or below the federal poverty level, meaning they are the most economically compromised of America's precious senior citizens," wrote  Dan Weber,  president of the Association of Mature American Citizens, in an opinion piece in The Washington Times. 

Weber said the cuts are counterproductive since studies show the economic benefits of home helth care.

“Using 2009 as a reference year, Medicare’s average Part A and Part B payment for a home health care visit was $145, compared to $373 per day in a skilled nursing facility or a whopping $1,805 per day in a hospital,” Weber wrote. “In addition, according to one leading expert, skilled home health care services saved the Medicare program $2.8 billion during the most recent three-year period. Approximately $670 million of that savings is attributable to 20,000 fewer hospital readmissions.”

“Despite claims that the Affordable Care Act will not result in job loss for American workers, this month’s jobs report suggests that the Medicare cut to home health is doing just that,” stated Eric Berger, chief executive officer of the Partnership for Quality Home Healthcare. “Obamacare’s deep Medicare home health cut is having a direct impact on the Medicare program’s most vulnerable patient population and the healthcare professionals – most of whom are women – on whom seniors depend.”

 “More than 90 percent of those providing home health care are small businesses,” Weber wrote. “According to the U.S. Center for Medicare and Medicaid Services, 40 percent of these companies will be operating 'at a loss' - that is, they will likely fold or end up in bankruptcy — by 2017 as a result of the cut."

However, the Obama administration said the home health care industry will survive, according to a report in Bloomberg Business Week.

 From 2004 to 2012 the number of home health agencies in the U.S. increased by 57 percent, to 12,215, according to data from the Medicare Payment Advisory Commission, which advises Congress. Most are for-profit companies that “have been paid well in excess of their costs,” the Medicare panel said in a report last year.

AARP has urged Medicare to reconsider the cuts and make sure seniors “have the access to home health care that they need,”  Rhonda Richards, a lobbyist for the group, told Bloomberg.

Friday, March 7, 2014

Michigan public schools increasingly outsourcing services

Privatizing noninstructional services continues to grow in popularity among Michigan’s public school districts.

Wyandotte and Riverview were among districts that privatized additional services in 2013, according to an annual survey on the subject carried out by the Mackinac Center for Public Policy, a conservative think tank.

Wyandotte and Riverview privatized — or outsourced, depending on the terminology you prefer — their transportation while Riverview also contracted out for food service.

Public schools are under considerable financial pressure and one of the ways they can maximize their resources is through contracting out for support services.

Two-thirds of Michigan school districts now contract out to private companies at least one of the three noninstructional services that nearly all districts finance — food, custodial and transportation, the study said.

 In 2013, 65.5 percent of districts in Michigan contracted out at least one of these three support services. This is up from 60.7 percent in 2012, according to the Mackinac study.

Wyandotte’s decision to outsource transportation last June was carefully thought out.

The issue was settled upon in the collective bargaining agreement between the school district and American Federation of State, County and Municipal Employees Local 1055, according to a report in The News-Herald.

Trinity Transportation, the company awarded the contract, also purchased the district’s 11 school buses.

Total transportation costs to the district were about $800,000 annually before outsoursing. They are now fixed at between $275,000 to about $292,000 per year over the next three years. Obviously, the savings are substantial.
That is precisely why districts have gone to outsourcing, although it can obviously be painful for the employees that are involved.

In Wyandotte’s case, the district promised to retain all employees and has done so through attrition, and that has turned out to be the case, said Wyandotte Superintendent Carla Harting.

Downriver districts that contract for food services include Trenton, Ecorse, Flat Rock, Riverview and Woodhaven, according to the Mackinac Center.

Southgate and Flat Rock contract for custodial services.

Besides Wyandotte, Taylor, Ecorse, Trenton and Riverview outsource transportation.

“The trend keeps continuing,” said James Hohman, assistant director of fiscal policy for the Mackinac Center and one of the authors of the privatization study. He noted that only 31 percent of districts privatized any of their services in 2001, the first year the study was done.

“It won’t work for every district,” Hohman said, adding some districts team up with adjoining systems to pool their services and economize and some districts have tried outsourcing and abandoned it.

Transportation contracting, the least frequent of the services to be contracted out, is increasing rapidly, the study said.

“The proportion of districts using private companies to provide transportation services increased from 16.4 percent to 20.9 percent from 2012 to 2013,” the study said.

Thirty districts began new contracts for transportation services in 2013. In 2008, only 6 percent of districts contracted out the service.
Custodial services are the most frequently contracted service, with 45.5 percent of districts using private contractors in 2013. This is an increase from 39.2 percent in 2012. These figures have grown steadily since 2003 when just 6.6 percent of districts used private contractors to clean and maintain district buildings.

“Food service contracting is not growing as quickly as the other two services, but remains quite common,” the study said. “In 2013, 21 districts began new contracts for these services. The rates increased slightly, from 34.6 percent in 2012 to 36.5 percent in 2013.”

One thing is certain: Downriverites ought to be insisting that their school boards at least study the issue, if they haven’t already.

Saturday, March 1, 2014

Sander Levin embraces tax reform

With a lifetime of public service that includes  32 years in Congress, Sander Levin knows a good thing when he sees it.

And he thinks colleague Dave Camp is onto something good with his comprehensive tax reform proposal.

Camp and Levin share something in common — their membership on the Ways and Means Committee of the U.S. House of Representatives.

Camp, a member of the House’s Republican majority, is chairman of the committee  and Levin is the ranking Democrat. Levin was chairman of the committee when Democrats last held a majority in the House, prior to 2011.

They also are both from Michigan, Camp hailing from Midland and Levin from Royal Oak.

Camp has been working on his plan for three years, and has held hearings across the country. He also has attempted to design it to win bipartisan support.

Otherwise, why work on it at all? The only reasons would be purely partisan, and if that were the case it wouldn’t be worthy of any attention at all.

Levin thinks the plan has some merit. He issued the following statement:

 “Chairman Camp’s tax reform proposal opens up a discussion that Democrats have wanted to engage in on a bipartisan basis. As Democrats, we believe it is vital that tax reform encourage economic growth, support working families, broaden the middle class, and address income inequality. It must produce a fairer and more adequate tax code for all Americans, ensuring that wealthy individuals and corporations pay their fair share while preserving our long-term economic security in a fiscally responsible way that promotes jobs in the United States. It is through the lens of those priorities that we will review Chairman Camp’s proposal in detail as the Committee undertakes a thorough examination of his proposal.”

Well, we should all hope there will be serious consideration. Much of it is just pure common sense, regardless of whether you are a Republican or Democrat.

Perhaps it is too much to hope that it would stand  a chance in this political year, but hope springs eternal. And springtime is right around the corner.