From the safe at home offices of Mitchell Research & Communications and Dykema
On March 10th, the evening of Michigan’s Presidential Primary, MDHHS received word that Michigan had its first two presumptive-positive cases of COVID-19. That same night, Governor Whitmer declared a State of Emergency. As testing began to very slowly ramp up, confirmed cases began to increase at the same pace. Thirteen days later the Governor issued her “Stay home, Stay Safe” Executive Order for all non-essential workers, and the rest is history.
Thirty-minute meetings scheduled in the Binsfeld Senate Office Building regarding the MDHHS budget became 30-minute Zoom meetings discussing the impacts of COVID-19 as Michigan went to Shelter-in-place. Our elected officials are faced with addressing the enormous economic and social impacts that COVID-19 has brought upon us.
Senators and Representatives are fielding an enormous number of constituent questions and requests for assistance. One of the most common issues is the Unemployment Insurance Agency (UIA). The service was undermanned and had great difficulty responding to those applying. As time goes on, service is getting better, but problems still exist. As importantly, with unprecedented Michigan job losses, the state’s $4.6 billion dollar unemployment endowment will only last a few more months given the current usage rate. It is one of the multitudes of great fiscal problems facing the state.
House and Senate Appropriations members are going to have to tackle the first state budget crisis since the Great Recession. The Governor has been slowly re-opening different sectors, but the damage to Michigan’s economy will impact not only the remainder of the current fiscal year but years to come. The state is facing at least an estimated $3 billion deficit for the current fiscal year and that is likely to increase.
According to the Senate Fiscal Agency, April revenues came in $1 billion below agency projections for the month and May posted similar losses. A great deal of those lost revenues come as a result of tax filing deadline shifts, including annual tax returns and quarterly corporate and individual income tax returns being delayed. However, with almost all businesses shutdown; the state is not collecting sales tax either.
As the primary funder of state general fund, sale, and income tax collections being significantly down means tough cuts will be coming for the remainder of the FY20 budget (ends September 30, 2020) and the FY21 budget (begins October 1, 2020).
With such a huge loss in state revenue, the Governor may decide to do a budget reduction via Executive Order. All of this leads up to the legislature being required, by state statute, to present a FY21 budget to the Governor for her consideration by July 1, 2020.
All while budget negotiations are taking place in Lansing, candidates up and down the ballot are doing their best to connect with voters with new social distancing guidelines. The May 5th, 2020 local elections saw record-breaking increases in absentee voting (>99%) as well as minimal in-person turnout (<1%). 33 counties and 200 municipalities held 50 elections and they had 25% of eligible voters participate. May elections typically turn out an average of 12% of eligible voters according to the Secretary of State. The previous record was set at 23% in 2015 when proposal 2015-1 (The Michigan Sales Tax Increase for Transportation Amendment) was on the ballot which was Governor Snyder’s road funding solution. The proposal failed to get less than 20% of voter’s support.
A large increase in absentee voting, very little in-person voting, and overall higher voter turnout similar to the May 5th election is likely a glimpse of what is to come both on August 4th and November 3rd.
Residents can begin requesting absentee ballots for the August primary on June 10th so there is little time to waste for candidates. In light of COVID-19 concerns, campaigns have been unable to campaign via “door-to-door,” which is a staple in any campaign, and it is forcing candidates to adapt and invest scarce resources in social media, direct mail, and other media outlets.
There is light at the end of this tunnel. The daily numbers of confirmed cases and deaths related to COVID-19 continues to trend downward according to MDHHS reporting. The Governor’s workgroups have focussed on re-opening the economy. But, even as sections open, the loss of revenue has been incredible and now people have to get comfortable with returning to a more normalized way of life.
There is still much work to be done! MAHP continues to advocate on plan’s behalf on the following policy priorities; including, but not limited to: preventing surprise medical billing, prior authorization reform, executive order codifications, commercial marketplace transparency (the DIFS Competition Report & Employer Claims Data), behavioral health integration, MLTSS, pharmaceutical transparency, etc.
The Legislature has resumed its normal business functions with new safety procedures. Team MAHP serves at the ready to assist Plans through this new normal we are all endeavoring to navigate.
Thank you for the essential work that Plans have been doing on behalf of its members.