26 February 2013

Spending Cuts of $85B puts $22M in MI School Money at Risk

Story first appeared on The Detroit Free Press -

With $85-billion in automatic, across-the-board spending cuts to go into effect Friday, White House officials on Sunday hiked up the pressure on congressional Republicans, issuing a set of state-by-state reports detailing the damage that would be done.

Nationally, tens of thousands of kids would lose Head Start services, Customs and Border Patrol hours would be cut and mental health funding would be reduced, to name some of the outcomes. In Michigan, 10,000 Defense Department workers would face one-day-a-week furloughs – more than initially believed – and the state would lose $22-million in school funding, putting 300 teacher and aide jobs at risk.

“This is going to have very real impact on people’s lives and people’s communities,” said White House senior advisor Dan Pfeiffer, who added that he understood the skepticism of some Americans that, with past funding crises averted, that this one was real.

“Are all these things going to go in effect on the first day? No,” he said. But people will feel the result of the cuts which when fully implemented “will be incredibly disruptive to their lives, to their communities.”

The Free Press in Sunday’s editions took a comprehensive look at what the so-called sequester – a Washington word for the process by which $85-billion would be trimmed from federal spending between now and Sept. 30 – noting that reductions could potentially hit defense contractors, teachers, students, shippers, automakers and more. Reductions at the Federal Aviation Administration and other agencies could lead to delayed flights and longer security lines; funding for scientific research at local universities could be slashed.

But there still seemed to be little likelihood of a compromise in advance of Friday’s deadline. President Barack Obama continued to call on Republicans to accept an offer to combine some spending cuts with raising taxes on the wealthy by limiting deductions and closing some loopholes. Republicans continue to stand their ground that more spending cuts – not increased tax revenue – was called for.

Republicans have been far from unified in their response to the pending sequester, however. U.S. Rep. Justin Amash (R-Cascade Township) has argued that it’s actually too small a cut and that overall spending will continue to increase. And last week, U.S. Rep. Candice Miller (R-Harrison Township) said there are better ways to implement a reduction but that Obama only appears out to “frighten Americans.”

"Republicans in the House have voted - twice - to replace President Obama's sequester with smarter spending cuts," said Michael Steel, spokesman for House Speaker John Boehner, R-Ohio. "The White House needs to spend less time explaining to the press how bad the sequester will be and more time actually working to stop it."

White House officials said while the effects may not be felt immediately, they are real. In Michigan, they could include:

• About $20-million less in education funds that support 240 teachers, aides, and staff who help children with disabilities.

• Reduced funding that would result in about 4,400 fewer children in the state receiving vaccines for measles, mumps and other diseases.

• A $1.8-million reduction in funds that help provide meals for seniors.

Patterson under fire for arguing against MI no-fault insurance change

Story first appeared on The Detroit Free Press -

The state has fired back at Oakland County Executive L. Brooks Patterson, who made a very public plea this week to tread carefully before making big changes to the state’s no-fault insurance law.

Gov. Rick Snyder has made no-fault reform one of his top priorities for the year, saying that Michigan has the 10th highest auto insurance costs in the nation. And Kevin Clinton, Commissioner of the Office of Financial and Insurance Regulation replied to Patterson’s open letter with one of his own.

“I was very disappointed to read Oakland County Executive L. Brooks Patterson’s recent statement regarding the Governor’s proposal,” the letter said. “In spite of his assertion, there is no effort to ‘dismantle’ no fault. To the contrary, our effort is to save no fault for the long-term.”

Patterson, who suffered critical injuries in a two-car crash on Aug. 10 that also paralyzed his driver, James Cram, said drastic changes to no-fault and the Michigan Catastrophic Claims Association would hurt Michigan’s economy and hospitals, shift health care costs to Medicaid and harm critically injured car crash victims.

The MCCA reimburses insurers for costs of more than $500,000 for the care and treatment of those seriously injured in automobile accidents.

Patterson said an independent financial analysis of the law and consequences of changing it should be done before any changes are made.

But Clinton said in his letter that Michigan’s economy is suffering because of skyrocketing insurance rates.

“How long can we ask our citizens who buy state-mandated coverage to foot the bill,” he said.

The insurance industry also noted this week that Patterson should wait to complain about no-fault reform until a bill is actually introduced.

Reform was discussed last year, but never received a vote in the full state House or Senate. Legislators have said they plan to reintroduce a bill this year.

“We believe that L. Brooks Patterson has been an outstanding public official and a visionary county executive, but his vision on this issue is a little cloudy,” the Michigan Insurance Coalition, a trade association of insurance companies in the state, said in a press release today. “Michigan’s No-Fault system is a runaway train that needs reform now before it plunges off the fiscal cliff forever.”

19 February 2013

$4 gas in MI makes Governor's increased gas tax plan tough sell

Story first appeared on Detroit Free Press -

Average gasoline prices in Michigan were pushing rapidly toward $4 per gallon Monday, a psychological benchmark that irked motorists and likely made passage of a gas tax proposal from Gov. Rick Snyder even more difficult.

The rising gas prices -- a product of numerous regional, national and global factors -- come amid Snyder's call in his State of the State address Feb. 7 for state lawmakers to increase Michigan's wholesale gas tax by 14 cents a gallon and its diesel tax by 19 cents to pay for road repair and maintenance.

The tax and fee increases would raise $1.2 billion annually.

Republican leaders, including Secretary of State Ruth Johnson and Senate Majority Leader Randy Richardville, joined a chorus last week criticizing the proposal.

A spokesman for the governor, Kurt Weiss, said Monday, "We know we have some work to do on that legislation, and we are willing to roll up our sleeves and come up with a solution for fixing our roads."

Michigan ranks sixth among the 50 states for the highest taxes on gasoline, according to a January survey by the American Petroleum Institute.

Michigan's average price per gallon for regular last breached $4 over the summer.

Gas was selling Monday for $3.95 a gallon -- cash or credit -- at the Mobil station on Woodward in Midtown Detroit.

Em Jacoby, 27, of Detroit was shocked by the final price reading on her pump.

"I just spent 50 bucks and I thought I was going to spend $30," she said. "And I didn't even fill it up all the way."

Sarita Scott, 42, also of Detroit, was happy she no longer drives an SUV.

"It went up very fast and unfortunately it's already tough times for people," she said, "and this doesn't help."

A Pontiac Vibe driver at the Midtown Mobil said higher gas prices are actually a good thing because they push people to buy fuel-efficient vehicles. The Vibe model gets about 30 m.p.g. combined city and highway.

"I think (gas) should be taxed higher," said Cory Cookingham, 21, of Flint, who added, "But I don't drive that much."

The average statewide cash price for a gallon of regular unleaded was $3.91 a gallon, an increase of 16 cents from a week ago, according to AAA Michigan's Daily Fuel Gauge report. The average was 60 cents higher than in mid-January, when prices began this latest ascent. In metro Detroit, pump prices were averaging $3.88 a gallon on Monday. Pricier gas was found in Ann Arbor, Grand Rapids and Jackson, according to the auto club's survey.

The national average on Monday was $3.73 a gallon for regular unleaded, according to AAA. Prices were highest in Hawaii followed by California, where news reports told of a $5-plus-per-gallon price in southern California.

Mark Griffin, president of the Michigan Petroleum Association, attributed much of the recent price increases to financial speculation in the oil commodities market. He said the association's retail outlet members have little economic choice but to pass along the price increases that are hitting them to consumers.

"Historically, we do see this type of an increase, but it's usually a little later in the March time frame," Griffin said Monday. "This year it seems to be a couple of weeks early. And what drives most of it is speculation; the oil markets start speculating that the demand is going to come and that drives it up."

The price of a barrel of West Texas Intermediate crude oil for March delivery was just under $95.60 on Monday, according to Bloomberg News.

Patrick DeHaan, a petroleum analyst for GasBuddy.com, said several recent minor issues at Great Lakes region oil refineries could also be having an effect on Michigan gas prices. He also pointed to recent data compiled by the U.S. agency that monitors commodity markets that show speculators placing more long-term bets that oil prices will rise.

"When you see a lot of contracts shift from short to long, it can bring even more traders to do the same thing, and it can have an impact on the price of crude oil," DeHaan said.

Oil and gas analyst Stephen Schork also attributed much of the recent price spike to refinery problems as well as a scheduled refinery maintenance season. The U.S. has long had issues with tight refinery capacity.

"The longer, harder you run a machine, chances are that machine is going to break down," Schork said. "Is there some degree of speculation? Absolutely. Because there always is. But you can't blame these high gasoline prices on speculation."

Nurse Sues Hospital for Supporting Discrimination

Story first appeared on Detroit Free Press -

An African-American nurse who is suing a Flint hospital because she said it agreed to a man's request that no African-American nurses care for his newborn recalled Monday that she was stunned by her employer's actions.

"I didn't even know how to react," said Tonya Battle, 49, a veteran of the neonatal intensive care unit and a nearly 25-year employee of the Hurley Medical Center.

Battle's lawsuit states a note was posted on the assignment clipboard reading "No African American nurse to take care of baby," according to the eight-page complaint against the medical center.

Hurley, which according to its website was founded in 1908 and is a 443-bed teaching hospital, released a brief statement Monday, saying that it "does not comment on past or current litigation."

Battle said she was working as a registered nurse in Hurley's neonatal intensive care unit Oct. 31, when a man walked into the NICU, where Battle was at an infant's bedside. He reached toward the child, according to the lawsuit filed in Genesee County Circuit Court last month.

"I introduced myself to him. 'Hi, I'm Tonya and I'm taking care of your baby. Can I see your (identification) band?' " Battle said, referring to the hospital-issued identification used to identify infants' parents. "And he said in return, 'And I need to see your supervisor.' "

Perplexed by his curtness, she asked for the charge nurse, who spoke separately to the man.

When the charge nurse returned, she told Battle that the father didn't want African Americans to care for his child. Further, the charge nurse told Battle that he had rolled up his sleeve to expose what appeared to be a swastika.

"I felt like I froze," Battle said. "I just was really dumbfounded. I couldn't believe that's why he was so angry (and) that's why he was requesting my charge nurse. I think my mouth hit the floor. It was really disbelief."

The charge nurse passed the request to her supervisor, and Battle was reassigned, according to the complaint.

Even after hospital officials removed the sign that had been placed for a short time on the assignment chart, Battle and other black nurses were not assigned to care for the baby for about a month "because of their race," according the lawsuit. Battle is seeking punitive damages for emotional stress, mental anguish, humiliation and damage to her reputation.

Battle said colleagues have told her they were surprised at the hospital's stand and they have been supportive. But she said she felt the issue was important enough to pursue the matter legally because she expected Hurley to have turned down such a request.

"What flashed in my mind is, 'What's next? A note on the water fountain that says 'No blacks? Or a note on the bathroom that says 'No blacks'?" she said.

Larry Dubin, a law professor at University of Detroit Mercy's School of Law, called the hospital's actions, if true, "morally repugnant."

"The patient's father has the right to select the hospital to treat the child. The father does not have the right to exercise control over the hospital in discrimination of its employees," he said.

The case "puts into tension two different facets of the law," said Lance Gable, an associate professor specializing in health law at the Wayne State University Law School.

Patients choose their doctors, he said. Some women prefer to see female gynecologists, for example.

"But there are also laws prohibiting discrimination," he added, citing the 1964 Civil Rights Act, among others.

"The bottom line is that the law is not clear about this, although I suspect the nurse will have a pretty strong case," Gable said.

One in 3 doctors in a 2007 survey said they felt patients believed they got better care if they matched their doctor's race. Patients' requests were more likely to be honored if the request came from someone who was female, non-white or Muslim, according to a report on the survey written in part by a University of Michigan researcher.

But just how often hospitals receive requests based on race is unclear.

Vickie Winn, spokeswoman for Children's Hospital of Michigan, said the hospital may try to accommodate a patient's request for providers with a certain religion or gender, but a request for a doctor based on race is different, she said.

"It has come up in the past, but generally speaking, we don't accommodate that. ... We have a very diverse population, and we just don't feed into those kinds of beliefs," Winn said.

Beaumont Health System, likewise, does not accommodate requests based on race, said spokesman Bob Ortlieb.

Julie Gafkay, an employment discrimination and civil rights lawyer in Frankenmuth who is representing Battle, said medical personnel might receive such requests from time to time, but employers must guard against racial discrimination.

"I don't doubt that people have made requests like this in the past. You're not going to control the prejudices and biases of people. That's not my client's issue. The problem she has ... is that her employer of 25 years granted" the request.

She added: "We made a decision in this country that, that kind of discrimination is wrong."

18 February 2013

Haveman Keeping Close Watch on LG Chem

Story first appeared on WoodTV10 Grand Rapids -

Holland battery maker repaid some federal funds

The US Department of Energy's $151 million federal grant for LG Chem wasn't all that lured the company to build their plant in Holland. There was also the lure of $125 million in state tax credits.

Those tax credits would be up to $25 million a year for four years - based on LG Chem's investment and job creation - and another $25 million over 15 years based on jobs.

Though the company has not yet filed for any tax credits -- and the state is not out any money yet -- the chair of the Michigan House Appropriations Committee said the state is keeping a close eye on the plant after a federal audit forced LG Chem to repay $842,000 in misused funds for workers who were playing cards and board games and volunteering in the community.

The audit was triggered by a Target 8 investigation.

It raised questions about whether taxpayers would ever benefit from the investment. The plant in Holland has yet to produce a battery for sale, in part because of sluggish sales for the Chevrolet Volt and because LG Chem didn't shift production from South Korea, as was expected.

"The feds are finding things out that we suspected but didn't know for sure, so certainly there's going to be added scrutiny," said Rep. Joe Haveman (R-Holland.) "Michigan taxpayers are not on the hook for it yet and have not been taken advantage of by this company. I don't want to lead people to believe we've lost their money without seeing the batteries produced and the jobs created."

In order to qualify for the biggest of the tax breaks, LG Chem must have 300 employees by the end of 2015. Currently, they employ about 150.

14 February 2013

Meijer Flagship Model to be Redone in GR-Area

Story first appeared on WoodTV.com -

A plan to renovate some Meijer stores -- including one Grand Rapids-area location -- and build new super-centers is expected to create more than 1,500 jobs in Michigan, Indiana and Illinois.

Meijer is investing $160 million to build six new stores and renovate five more in the three states.

Improvements will include better lighting, heating, refrigeration and parking. Changes will also be made to make the stores more energy efficient.

Among the stores getting a facelift is the Knapp's Corner Meijer, 1997 E. Beltline Ave. NE in Grand Rapids Township. It will get a "flagship remodel" that will test designs that may eventually be implemented in other stores.

An aging Meijer store in Lansing will be rebuilt in the next 14 months.

New Meijer stores expected to open in 2013:
  • Swartz Creek, Mich.
  • Portage, Ind.
  • Detroit, Mich.
  • Danville, Ill.
  • Evergreen Park, Ill.
  • Warsaw, Ind.
Each new store is expected to hire 250 full- and part-time employees.

"We are pleased to continue to invest in the Midwest communities that have supported us for so long," Meijer Co-CEO Hank Meijer said in a Wednesday statement. "By keeping prices low and maintaining our focus on customer service, we have been able to continue to grow during a tough economic cycle."

Stores to be remodeled:
  • Lansing, Mich. (S. Pennsylvania Road)
  • Taylor, Mich.
  • Flint, Mich. (Hill Road)
  • Springfield, Ill.
  • Grand Rapids, Mich. (Knapp's Corner)

LG Chem Plant Workers Still Have No Work

Story first appeared on WoodTV.com -

Though a federal audit sparked by a Target 8 investigation got taxpayers some of their money back from LG Chem, there's still not much work to do at the Holland plant.

An October 2012 Target 8 investigation revealed that employees at LG Chem were playing board games and volunteering while on the clock and sparked a federal audit. Following the audit, it was announced Tuesday that LG Chem has repaid $842,000 in taxpayer money, admitting it misspent some of the millions received from the federal government. 
Current and former LG Chem employees Wednesday told Target 8 they now spend every day cleaning: Cleaning a nearly new building that doesn't produce anything for sale.

"We regret this situation occurred, and we are confident that we are now taking every measure to be fully compliant in our use of the project grant funding," LG Chem said in a Wednesday statement. "LG Chem Michigan has also established internal safeguards to prevent this from happening again."

But employees say they spend most of their day cleaning things that are "already clean because there is nothing else to do."

No one wanted to speak on camera for fear of losing their job. But off camera, employees said all the production equipment is in storage.

Nothing has been produced for sale and there is no word on when production will start up again.

Overall -- little has changed since Target 8's first investigation.

"We were given assignments to go outside and clean; if we weren't cleaning outside, we were cleaning inside. If there was nothing for us to do, we would study in the cafeteria, or we would sit and play cards, sit and read magazines," former LG Chem employee Nicole Merryman, who said she quit in May 2012, told Target 8 in October.

Employees confirmed to Target 8 that they are no longer allowed to play games or volunteer.

Some say many of the employees left other jobs to work at LG Chem. They are worried if production doesn't start soon, they will be unemployed.

11 February 2013

Borders' Has Sold Former Ann Arbor Headquarters

Story first appeared on The Detroit News -

Price Not Disclosed; Buyer Asked For Confidentiality

The former Ann Arbor headquarters of defunct bookseller Borders Group Inc. has been sold to an unidentified buyer who requested a confidentiality agreement, the Ann Arbor office of Colliers International said Friday.

The development follows an October statement by the site's broker, Jim Chaconas, that the 330,000-square-foot campus for the former bookstore chain that liquidated and closed in 2011 would soon be sold.

The headquarters building and campus was listed for $6.9 million in early 2012, and Chaconas said in October that the prospective buyer came "pretty close" to that number.

Chaconas said then that he was working with three tenants to move into the property.

One would occupy all of the smaller, 87,000-square-foot building and others would share the larger, 243,000-square-foot building.

Because of the confidentiality agreement, it is not clear whether new tenants will move in or whether a new owner has bought the building and has different plans for the property.

Chaconas was not available for comment. In October, he said the site is large enough to allow tenants to expand and has more than 1,200 parking spaces.

Before Borders decided to liquidate in July 2011, it had 440 staffers at the corporate campus at 100 Phoenix Drive and occupied only a portion of a building.

The headquarters' former owner, Farmington Hills-based Agree Realty Co., defaulted on a $5.6 million loan in 2011. Colliers International was hired to handle the sale of the property after a settlement agreement was reached with Agree Realty.

04 February 2013

Michigan Budget: Mental Health a Priority

Story first appeared on LSJ.com

When Gov. Rick Snyder unveils his budget proposal Thursday, many expect him to address what has become a hot-button issue nationwide — an underfunded mental health system.

In the wake of a Dec. 14 shooting spree at a Connecticut elementary school, administration officials say Snyder likely will seek at least $5 million in new spending for programs aimed at identifying emotionally troubled youths.

But the real question Thursday is whether Snyder will back a plan for Michigan to join a federal expansion of Medicaid authorized in the Affordable Health Care Act. Snyder is expected to reveal whether he supports the expansion, which could inject about $6 billion in federal funding into Michigan for health and mental health services within the first three years.

Mental health advocates say the new funding could begin to reverse an underfunded mental health system in Michigan that has left many without help. Since 2004, the state has slashed community mental health funding by about 31 percent to $274 million — a reduction of $124 million.

Advocates estimate 250,000 people statewide who suffer from serious mental illness in Michigan aren't getting the services they need, and nationwide, Michigan ranks near the bottom in the amount it spends per mental health patient on publicly funded hospital beds.

“We have too many people with schizophrenia or bipolar disorder or major depression who are not getting treatment, and because of that, their symptoms are not being controlled,” said Mark Reinstein, president and CEO of Mental Health Association in Michigan. “We have far too many people left to their own devices.”

Stiff resistance
But regardless of what Snyder announces Thursday, a proposed Medicaid expansion would face stiff resistance in the Republican-controlled House, where Republican leaders worry Michigan one day would be forced to foot most of the bill for expanded Medicaid.

Currently, 1.9 million Michigan residents receive Medicaid, and the state pays about $4.8 billion, or 40 percent, of its approximately $12 billion annual Medicaid budget. The federal government pays the rest.

Under the federal health care law, states would pay nothing for the first three years and ultimately 10 percent of the Medicaid expansion after three years — or about $200 million annually. It would add an estimated 500,000 to Michigan’s Medicaid rolls.

“We’re cautiously skeptical, appropriately skeptical,” Republican House Speaker Jase Bolger said. “We have significant concern as to whether it is affordable in the long term. … The federal government has quite a history of dangling carrots and then abandoning states and then leaving them to pay for these things.”

Critics also question whether the state should commit to a new annual $200 million expenditure given its recent attempts to cut spending, and they argue it’s difficult to scale back public assistance once it’s offered.

Snyder has given few clues as to whether he’ll ultimately support an expanded Medicaid. But he has said he is concerned whether Michigan has enough doctors to handle the 500,000 people who would be added to Medicaid rolls under an expansion.

However, a study released last week concluded there were enough Michigan doctors to handle the new patients. The report found that 81 percent of physicians statewide could add patients who would become newly insured under a Medicaid expansion, according to the Center for Healthcare & Transformation, a group formed by the University of Michigan and Blue Cross Blue Shield of Michigan to study health care issues in Michigan.

Reinstein said the injection of new Medicaid funding for mental health would be especially helpful in Michigan, which is one of only seven states that don't require insurers to cover mental ailments in the same fashion as physical ones. The federal health care act expands Medicaid eligibility to families of four with an income of up to $30,656, and individuals with an income of up to $14,856.

'Good first step'
Mental health advocates say expanding Medicaid is critical because they question whether $5 million for new youth mental health programs is enough to address the need. Administration officials say Snyder likely will propose a new program to train doctors, teachers and others who frequently come into contact with children and young adults to identify emotionally troubled youth and direct them to the help that they need.

“It’s not sufficient money, given that (Michigan) has made due with a mental health budget that has been cut consistently for the last 10 to 12 years,” said Malisa Pearson, executive director of the Lansing-based Association for Children's Mental Health. “But it’s a good first step.”

Pearson said the association now is expanding its own program to educate teachers and other professionals in Michigan on identifying troubled youth, and that two certified instructors will offer seminars later this year. Once troubled youths are identified, she said, the goal is to direct them to mental health counseling, ideally in a home setting.

These troubled youths typically aren’t violent to others, but many become suicidal, Pearson said.