Michigan Business Leaders Support Earned Income Tax Credit and Reformed Term Limits
Business Leaders for Michigan voices support for term limit reform and increased earned income tax credit in its new strategy to position Michigan among the top 10 states.
The “Compete to Win” plan identifies a number of priorities that the state business roundtable has identified as areas for improvement to help Michigan grow its economy and become a place where more people want to do Business. It is ranked 29th, according to the group’s comparative study released earlier this year. Recommendations include efforts around education to remove barriers to labor market entry to improve infrastructure. The report seeks to influence campaign discussions.
The organization’s board also voted in favor of a ballot initiative that Michigan voters will consider on Nov. 8 that would amend the state’s constitution by reforming term limits for lawmakers and increasing requirements. Financial Disclosure at Lansing.
Lawmakers can currently serve three two-year terms in the State House and two four-year terms in the Senate, a cap imposed to limit the influence of lobbyists and special interests. The new proposal would limit service time to 12 years between the two chambers, but allow that time to be spent in one chamber if desired. Thus, a legislator could serve up to six terms in the House or three terms in the Senate or a mix of terms between the two chambers totaling up to 12 years.
“What we’ve seen is that the most restrictive term limits we have in Michigan, the most restrictive in the country, have led to a breakdown in civility, relationships, the ability to think strategically long term,” said Jeff Donofrio. , CEO of Business Leaders for Michigan. “If you have a new house chair every two years or a new education committee chair every two years, and they have maybe at best two to four years of experience.
“It’s hard to have both this deep knowledge of these issues and the institutional memory of why things happened or didn’t happen. And so it didn’t lead to a coherent policy or an approach consistent in solving big problems.”
It showed Michigan’s lack of preparedness, Donofrio said, for projects like Ford Motor Co.’s $11.4 billion investment in electric vehicle and battery production in Tennessee and Kentucky, which will create 11,000 jobs.
“We weren’t prepared to have competitive incentives,” he said. “We weren’t prepared for the development of the site. We weren’t prepared to meet the talent solutions across the state.”
Michigan has one of the lowest labor force participation rates in the nation and one of the lowest participation growth rates, according to the Roundtable’s benchmark study. The strategy suggests looking at ways the state can help meet childcare needs, obtain licenses and return ex-offenders to the workplace. The group’s recent survey of Michigan CEOs showed that 87% believe they will have difficulty hiring in the next six to 12 months.
“They believe that because of two things,” Donofrio said. “One is a lack of skills, but also an availability of talent. They just don’t get enough applicants.”
One suggestion to help encourage labor force participation is to increase the earned income tax credit. Business Leaders for Michigan supports a boost, though it did not provide a specific amount.
Governor Gretchen Whitmer and Republican state lawmakers are proposing increases to the tax credit as part of duel plans over how to handle a projected $6 billion revenue surplus.
Whitmer is proposing an increase in the earned income tax credit for most low-income workers as part of his proposal to send $500 rebates to residents. Meanwhile, the sweeping $2.6 billion tax cut proposal passed by the House and Senate on Thursday would increase the earned income tax credit from 6% to 20%.
“It’s a tax credit that’s given to working parents and working families in the economy,” Donofrio said. “It’s something that helps families close and close the gap in terms of wages to support the family, but also to encourage work.”
Business Leaders for Michigan also supports efforts to attract teachers, including a scholarship program included in a proposed budget, and use federal and state surpluses to invest in classrooms and close performance gaps that have been exacerbated by the COVID-19 pandemic.
“It’s really a moment in time,” Donofrio said, “where we have to look at what’s going to make Michigan competitive, what’s going to help individuals and families thrive over the next 10 or 20 years. a way we haven’t been able to achieve.”