Michigan Votes Forum

Introduced in the Senate on August 9, 2006, to eliminate the Single Business Tax as of Dec. 31, 2007. The measure was placed before the legislature through a citizen initiative (petition drive). With this simple-majority vote the measure goes into law without the need for the governor's approval. In March, Gov. Jennifer Granholm vetoed a regular bill (House Bill 5743) to eliminate the SBT. The legislature has not passed a law to create a new business tax. Michigan businesses pay around $1.8 billion in SBT, and a similar amount in property taxes on real property and on business tools and equipment ("personal property"). The text of the measure is here.

The vote was 22 in favor, 16 opposed and 0 not voting

(Senate Roll Call 615 at Senate Journal 73)

Click here to view bill details.

Rep. Dillon, having reserved the right to explain his protest against the passage of the Initiative Petition, made the following statement: "Mr. Speaker and members of the House: I voted 'No' today on the initiative to repeal the SBT not because I am against eliminating the SBT but because I want to eliminate it in conjunction with the repeal of the personal property tax on manufacturers and along with the replacement tax so that businesses know what their new tax will be. It is irresponsible to leave our businesses in the dark while Lansing figures out how to replace the SBT. We should take responsibility for our actions and not push off for another day work that should be done today."

Rep. Bieda, having reserved the right to explain his protest against the passage of the Initiative Petition, made the following statement: "Mr. Speaker and members of the House: I voted 'no' on the petition to eliminate the Single Business Tax because doing away with the SBT without a plan in place to deal with the reduced revenue will not make Michigan a more attractive place to live or work. It will leave a cloud hanging over the state's fiscal fate, it will negatively impact the state's bond rating and few businesses will want to move here or stay here under that cloud for fear of getting soaked in the coming storm. Although I do support the elimination of the SBT, doing so without provisions for dealing with the negative budget implications is irresponsible and wrong. If we are truly serious about eliminating the SBT by next year, let's roll up our sleeves and get to work. Passing tax cuts without spending cuts or revenue replacements isn't public service, its public cowardice. Thus, I voted 'no' on this proposal."

Reps. Gonzales and Kathleen Law, having reserved the right to explain their protest against the passage of the Initiative Petition, made the following statement: "Mr. Speaker and members of the House: I voted 'no' on the SBT Repeal petition initiative because it will cost Michigan jobs. By repealing the SBT without telling the business community what replacement we intend to put in place, we are actually placing another burden onto business--the cost of uncertainty. Economic development projects and capital investment projects will be put on hold because business owners need to know what their future tax burdens will be. By repealing the SBT without passing its replacement, we threaten to increase the burden on the hardworking families in our state, either through increased taxes or cuts to services they depend on. This is reckless and irresponsible policy. The people of Michigan should not be forced to suffer because this legislature cannot do its job and offer up a replacement business tax right now, not some time in the distant future when Republicans decide it will not harm their chances in an the election."

Rep. Kolb, having reserved the right to explain his protest against the passage of the Initiative Petition, made the following statement: "Mr. Speaker and members of the House: I voted no on the SBT Repeal petition initiative because it is irresponsible to repeal the SBT without deciding on a replacement for it. This creates uncertainty for the business community, threatens existing economic development tax credits and tools to attract new businesses, and potentially creates a $1.8 billion hole in the state budget. By repealing the SBT without telling the business community what replacement we intend to put in place, we are creating unnecessary uncertainty in the business community. Economic development projects and capital investment projects will be put on hold because business owners need to know what their future tax burdens will be. How will Ford, GM or Delphi determine whether to consolidate jobs here in Michigan versus another state, if they cannot determine what the tax burden will be in our state? It is irresponsible to eliminate the SBT without identifying a replacement tax, or if you are not going to replace the revenue then you need to identify what programs you are going to cut in the state budget. By repealing the SBT without telling passing its replacement, we threaten to increase the burden on the hardworking families in our state, either through increased taxes or cuts to services they depend on. By repealing the SBT we place currently approved tax credits and abatements that have been given by the state to lure or get jobs in Michigan, at risk. These credits are important economic development tools that are threaten by the Legislatures actions. Will a company like Google still make the decision to come to Michigan, if their tax credits no longer exist? Elimination of the SBT revenues means that public safety is at risk. These dollars go to fund state police, corrections and revenue sharing to local communities. State spending on Higher Education is put at risk, fewer state dollars means less to state universities, equating to higher tuitions and fees. Health care and Human Services funding is threatened; Nursing home services, Medicaid and mental health services, access to Day Care services, emergency assistance to tens of thousands of families, and disability benefits for 10,000 adults with disabilities. This is reckless and irresponsible policy. The people of Michigan should not be forced to suffer because this legislature cannot do its job and offer up a replacement business tax right now, not some time in the distant future when Republicans decide it will not harm their chances in an the election."

Rep. Accavitti, having reserved the right to explain his protest against the passage of the Initiative Petition, made the following statement: "Mr. Speaker and members of the House: I voted no on the SBT Repeal petition initiative because it will cost Michigan jobs. By repealing the SBT without telling the business community what replacement we intend to put in place, we are actually placing another burden onto business-the cost of uncertainty. Economic development projects and capital investment projects will be put on hold because business owners need to know what their future tax burdens will be. By repealing the SBT without telling passing its replacement, we threaten to increase the burden on the hardworking families in our state, either through increased taxes or cuts to services they depend on. This is reckless and irresponsible policy. The people of Michigan should not be forced to suffer because this legislature cannot do its job and offer up a replacement business tax right now, not some time in the distant future when Republicans decide it will not harm their chances in an the election."

Senator Schauer's statement is as follows: This vote here today is the wrong prescription for what ails Michigan's economy. Instead of a responsible, aggressive plan to attract jobs, all we are offering is uncertainty and confusion for businesses that might be willing to grow here or locate here. Don't just take my word for it, colleagues. My own hometown newspaper, The Battle Creek Enquirer, had this to say on March 24: "Doing away with the SBT without a plan in place to deal with the reduced revenue will not make Michigan a more attractive place to live or work. It will leave a cloud hanging over the state's fiscal fate and few businesses will want to move here or stay here under that cloud for fear of getting soaked in the coming storm." I couldn't have said it better myself. Major employers in my district are saying the same thing. A "no" vote is not a vote in defense of the single business tax. A "no" vote represents the fact that we shouldn't take this step without a fiscally responsible plan in place. Democrats offered such a plan months ago, but the majority wasn't interested. They still aren't interested today and that's a shame. I will be voting "no."

Senator Thomas' statement is as follows: Madam President and colleagues, this issue continues to perplex me. Really, I ask the question, "Where are we now?" We're absolutely nowhere. Four years ago, this Legislature eliminated the single business tax at the end of 2009. Since then, over four years we've voted several times to eliminate the single business tax, yet not once in this four-year period have we really attempted to find a suitable replacement. We have a special joint committee, which I'm privileged to serve on, that doesn't meet. So maybe we're actually not serious about finding a replacement. We cannot end the single business tax, as all of my colleagues previously have spoken, without accounting for its $1.9 billion in revenue. As a small business owner with real practical experience, as there are others who have real practical business experience in this chamber know, businesses need many things to thrive and to survive. They need skilled employees, an educated workforce, and protected citizens. Accomplishing this actually does require money. Money does matter. What happens when a business discovers that there will be no money for education; that there will be no money for police protection; no money for general welfare exists in the state of Michigan. I would suggest to you, again from real-life practical experience, they'll choose to look elsewhere. We cannot allow this to happen. This Legislature has a fiscal and constitutional responsibility to stand up and declare that we really, really must have a plan to preserve this revenue. To not do so would be an absolute betrayal of the electors who have just put trust in us yesterday and will continue to put trust in us in November. So really what is stopping us? Is the leadership of this chamber afraid that the public prior to an election will actually figure out what our real intent is? That there really are only two choices here: either raise taxes or shift taxes onto the private sector onto individual citizens or to devastatingly cut education, devastatingly cut general welfare, devastatingly cut lease protection, roadwork. Those consequences must be--must be--deliberated before we take such an irresponsible action. It is time for this Legislature to actually make effective solutions, rather than effective sound bites. I urge a "no" vote on eliminating this tax without actually having a plan. It is shortsighted and not in the best interest of our constituents.

Senator Whitmer's statement, in which Senator Clark-Coleman concurred, is as follows: Here we go again. Once more we're going to vote to get rid of the SBT with no replacement in sight. Albert Einstein once said, "Insanity is doing the same thing over and over again and expecting different results." In fact, the Majority Leader used that very quote in support of doing the Price of Government budget exercise just last year. Unfortunately, the wisdom of that remark has not penetrated because here we go again--another tax cut, more pain, no relief. Madam President, we just passed the state budget. I don't know of any reasonable person who will claim it was a budget with $500 million worth of waste, much less $2 billion, which is what some people hope this tax cut amounts to. I invite any legislator to go on record with his or her constituents and say, "Yes, we could have cut another $500 million from the General Fund." Tell me where. Yet, that's exactly what the backers of this proposal want, a $500 million tax cut. Some even want the whole $2 billion, which is one-quarter of the state's General Fund. Let's look at the budget we just passed. We spent $78 million to keep a thousand state troopers on the road. We've spent about $100 million for aid for 84,000 college students; $435 million for nursing home care for 30,000 of Michigan's elderly residents. We'll lose some federal matching funds if we cut that spending. To put it another way, the same $500 million that Mr.Patterson wants to cut would fund the General Fund operations of the State Police, the Judiciary, the Education Department, the Agriculture Department, the Attorney General's Office, and more combined. So, if we're going to cut $500 million, or $2 billion for that matter, we aren't cutting to the bone; we're cutting through the bone. That's not a wise long-term strategy. Smart business people know that we need to spend money to protect our streets, educate our students, and care for our elderly. That's why they locate here. Smart people like Bill Gates have said the No.1 consideration when determining where to locate a business is not the taxes; it's having a qualified workforce and quality of life. But we are going to strip all of that away and toss it to the wind and hope it lands right-side up. We're going to end the SBT without any replacement and wait another year and a half for that decision. It's irresponsible at best and a total abandonment of your fiduciary duty to the thousands of people you each represent. I cannot in good conscience join you in this exercise, but I am willing and ready to join in a serious discussion and take action now to move Michigan forward.

Senator Basham's statement, in which Senator Clark-Coleman concurred, is as follows: Everything has been said here today but not by everybody, so let me just take a stab at it, if I may. If it sounds like an election-year gimmick and it smells like an election-year gimmick, then it's probably an election-year gimmick, and that's exactly what we're debating here today. Make no mistake about it. While my colleagues on the other side of the aisle have not contained their enthusiasm for abolishing the SBT, they aremuch more subdued about paying for a 20 percent cut in the General Fund budget. Health care, education, transportation, the State Police, veterans, agriculture, community colleges--virtually no area of state government would be immune to devastating cuts. Yet these colleagues are willing to slash all these services for the sake of appeasing special interests and making a political point for this year's campaign. Well, a more favorable tax climate will cease to be a draw when health care, schools, public safety, and transportation are all gutted and reduced to bare bones levels. A recent Lansing State Journal editorial said, "Passing a tax cut without replacement of revenue is not public policy. It's public cowardice." I agree and urge my colleagues across the aisle to come out from under their desks before the election and stand up to the challenge of finding a replacement for the $2 billion loss that this state will suffer.

Senator Switalski's statement is as follows: As the senior chamber in the Legislature, we Senators have a special duty to act responsibly. We must today confront a truism in politics. It's very easy to eliminate a tax, but it is infinitely harder to create one. So it is disingenuous to vote today to eliminate the single business tax, cut $2 billion from the budget, and then say, "Trust me. We'll come up with something later." When I first came to the Legislature eight years ago, we were holding hearings about changing the SBT. You may remember those days when we had the SBT and the economy was booming. You may recall that we had full Republican control then too. We had a very powerful Republican Governor in John Engler and Republican majorities in the House and the Senate. Somehow they did not think it was wise to eliminate the SBT. In the intervening years--in the eight years since--we have worked on a replacement, but we have never agreed on any substitute. So proponents of repeal sometimes suggest that we didn't have to replace the revenue. So are we prepared to cut 29percent across the board from the four largest General Fund departments--higher ed, Community Health, Corrections, and Human Services--or we could abolish GF appropriations to 17 state departments, plus community colleges, capital outlay, school aid, and Treasury Department service and revenue sharing, but even if we did that, we would still be $285 million short. This repeal has been called irresponsible, a gimmick, an election year sloganing, a gotcha, and a drunken sailor approach. It has been described as a shell game, a punt, and a ploy, a combination of voodoo economics and political malice. It has been called reckless, wrong, and unfair, and that's by its supporters. If the intent is not to cut the budget, then let's see what the proposals are to replace the revenue. Right now 50 percent of businesses do not pay any SBT. Do the proponents of this repeal believe that these small businesses should have to pay? Or should individuals have to pay more? Are the proponents of elimination suggesting that we raise the sales tax? I guess we'll find out after the election. Isn't that cynical? The giveaway occurs before the election and the bill comes due afterward. I will not be part of such fiscally irresponsible brinkmanship. I will vote "no" on this bill.

Senator Prusi's statement is as follows: Speaking of remarks printed in the Journal, I very seldom ask to have my remarks printed in the Journal because they are imminently forgettable in most instances. Several months ago when we dealt with this issue in a piece of legislation, I got up at this microphone and asked the body some questions that at that point I don't think I ever received an adequate answers or clear responses. Those questions still remain before us and I'd like to pose some of those questions one more time and see if anybody will give us an answer. One of the questions I asked was are we going to replace all or a portion of the revenue lost when this tax is eliminated? If it's only going to be a portion, how big a portion will it be? Will it be half, two-thirds, three-fourths, or 10 percent? I received no answer then. I don't think I've gotten an answer to this point on that question. The second major question that I asked at that time was without this replacement revenue--and the previous speaker was fairly eloquent in outlining what are we going to do with that loss of money--what programs, what state spending will we eliminate? Whether it's $500 million, $300 million, or the entire $2 billion, would you cut veterans services? We spend $22 billion on our state veterans' homes in Grand Rapids and in Marquette that serve 900 aging, ailing veterans in this state. Is that going to be on the chopping block that the veterans' in those veterans' homes will go without care? Are we going to close some more State Police posts or reduce the amount of troopers? We just funded a small trooper replacement, recruit school. Are we going to forego replacement troopers as our current state trooper force dwindles due to retirements? Higher education, are we going to watch our kids' tuition increase way beyond what we've seen in the last few years? We've finally managed to restore some money to the higher education budget. Without this $500 million, $200 million, or whatever you intend to not replace, that's going to have an impact on that tremendous addition to our economic development strategy here in Michigan and that's the education of our young workforce in the new technologies. Health care and human services, that General Fund money draws down federal dollars that funds the care of our elderly, our aging, and our disabled young who become adults. We do a lot of work in the Appropriations Committee, and just a few weeks ago, we passed a budget. I have to tell you, in the four years we've been working on the budget here in the Senate, that was the most cooperative, least contentious budget that we ever passed out of this chamber. Next year's budget, without this revenue, you can look forward to a lot more disharmony, a lot more fighting, and a lot more difficult decisions to be made. This vote threatens our ability to do all of those things that I think the voters in this state have come to regard as high priority items here. We are making a very serious mistake here by not allowing the debate to go statewide. I commend the petition drive. They went out and got the signatures, but why are we doing it here when it's a citizen-initiated petition? Let the debate go forward across the state. Let us have the discussions on what these priorities are. Let us have the people of the state of Michigan cast their ballots on this all-important issue in November. Let's have a discussion on the full range of this issue rather than eliminating it now and letting next year's Legislature fix it. There are some serious questions that remain here, Senate colleagues. I believe by voting to eliminate this tax here today, we are going to leave those questions unanswered and merely do a political exercise here rather than something that makes policy-sense for the people of the state of Michigan. I encourage you to vote "no" on this. Let's let the debate continue and let the people of the state of Michigan have their speech.

Senator Brater's statement is as follows: I am standing here before you to strongly urge a "no" vote on this proposal. Our economy in the state of Michigan is at a very fragile state right now. We should be working together with positive, constructive ways to attract jobs and businesses to Michigan, not to unsettle this very fragile balance just for election year politics. It's very reckless and very irresponsible to vote to eliminate $2 billion in revenues, almost 20 percent of our General Fund budget, without a plan to replace it. What are the things that our General Fund pays for? They pay for mental health services. It used to pay a subsidy to the School Aid Fund so that we could have smaller classrooms and better preparation for our teachers and other important things that we say we want for our schoolchildren in the state of Michigan. It used to subsidize a higher percentage of the higher education budget so that students going to college in this state don't have to pay such a large percent of their family income in order to get a college education, which we all acknowledge we have to increase the number of students going to college in this state in order to improve our economy. Survey after survey shows that businesses are not looking at tax rates; that's like No.4 or 5 in most surveys when they are evaluating where they locate. They are looking at what kind of infrastructure can a state provide, what kind of education system can the state provide, and what kind of quality of life is there in that state. The fact that we have all of those things in the Washtenaw County area is why Google is bringing 1,000 jobs to our community. If we want to spread that kind of success statewide, we have to allow the state to fund these types of programs that are going to attract quality, high-paying jobs to our state. If we repeal the single business tax without a replacement, we could be forced to gut entire budgets of programs or raise taxes on individuals or small business. The majority party in the Senate and House should have done the hard work of developing a responsible plan that will grow jobs instead of taking this cheap, political shot. I strongly urge a "no" vote on this proposal.

Senator Cropsey's statement is as follows: I find this argument and the arguments being used to be quite curious. The SBT is already going to be repealed December 31 of 2009, and I would dare say the vast majority of legislators here voted for that. And guess what? When you voted to repeal it December 31 of 2009, did you have a replacement in place for it? No.You didn't have a replacement in place for it. What this initiative is, is a signal that the business community is in deepseated trouble. We are in a noncompetitive situation and we're getting our jobs taken to the cleaners. Let me tell you why we need to repeal this tax and we need to repeal it now. In my district, I've lost Electrolux--3,000 jobs. I've lost the Federal Mogul plant--another 400 to 500jobs. We've lost Michigan Wire. We've lost Hitachi, which 3 or 4 years ago was employing 500 people. We've lost a plant, the Lear Corporation. I have lost in my district alone in the last three years 4,000 to 5,000 jobs and here we have the Governor touting she's got 1,000 jobs coming down to one county in this state and what a great thing that is. Well, it is a great thing, but let me tell you, it's a horrible thing that there have been 4,000 jobs leaving my district alone and the Governor touts 1,000 jobs coming into the state. This is insanity. Let me tell you what the Governor is doing to try and get jobs to come in here into the state. She uses the MEDC. And what are the incentives that the MEDC has? One of the huge incentives that the MEDC has is that we can give you tax abatements. We can cut taxes. We can do it on a business-by-business basis to cut taxes. And, lo and behold, businesses that are already here are taking a look at it and saying our taxes are too high and we're going to go someplace else that has a much more favorable business climate. The SBT has got to go. We keep losing business and jobs because the problem is that taxes are too high. The problem is that the SBT taxes wages, it taxes health care benefits, and it taxes businesses that are losing money. My district can't afford to wait more years while scores of businesses flee Michigan's tax climate. One reason why we need to repeal this and we need to repeal it now is that we have several people here who were here when Proposal A passed, and Proposal A passed without a replacement. And, by the way, Proposal A passed upon the insistence of a person who is now one of our United States Senators without a replacement. Some of the people who worked on that, besides myself, were the Senators from the 28th District, the 13th District, the 27th District, and the 5th District. After this next election, most of those people will be gone. We need to take advantage of those people's experience who were here working on December 24 of 1993. Obviously, they came up with a solution. We did come up with a solution that time, and they also realized what needed to be in place to help protect the public. We need to make sure we get a replacement in place if we're going to do one that is there before these people leave. We already have an experienced team in place to work on any replacement that may be done, lead by the Senator from the 15thDistrict, and also the State Treasurer who's been with the State Treasury for over 30 years with experience in business tax. By the way, the State Treasurer was working on the SBT and business tax before the Governor was even a Michigan resident. We will never have a stronger team in place than we have now. We'll never have more experience than we have now. Why would you want to wait for three more years? We'll probably never have a better working relationship with this Governor than we have now. The SBT is unique in the entire country. It is punitive, it is anti-tax, it is anti-jobs, and it is anti-worker, and it needs to go and it needs to go today.

Senator McManus' statement is as follows: I rise to speak in favor of the initiative before us today. I represent a very large geographic district, and I have many manufacturers in my Senate district. I have personally spoken with manufacturers from Cadillac. They represent thousands of manufacturing families who work in those factories and those places of business. Now for those of you who don't know about Cadillac, Cadillac is the largest manufacturing area north of Grand Rapids. Cadillac has companies that employ working families--working families who work at Four Winns. Four Winns makes fiberglass boats. RexAir makes vacuum cleaners. We all have vacuum cleaners. Cadillac Casting is a foundry that produces automotive and truck parts. BorgWarner designs and manufactures various temperature controls for commercial, agricultural, and military vehicles. These are not small employers. These employers represent about 300 to 800 people at their businesses. In addition, these are not small, isolated businesses either just in small Cadillac, Michigan. They have nationally- and internationally-based sister companies and competitors. When I have spoken with the leaders of these industries about comparing their Michigan facilities to those from their other states, the first thing that they mention is that Michigan has a very unique and burdensome tax structure. We know what we call that; it's called the SBT. It puts them at an immediate disadvantage for staying open in Michigan or expanding in other states due first obviously to the SBT tax, but second, to our very unique geography for getting goods in and out of Michigan. Now I know we can't change our geography here today, but we can certainly change our tax structure. I stand before you to ask that my colleagues support in this effort to make an enormous impact here in the state of Michigan and eliminate the SBT.

Senator Scott's statement is as follows: Once again, my colleagues on the other side of the aisle continue to choose corporations over kids and special interests over social safety nets, as they predictably put businesses ahead of the real needs of the people of this state. It's not surprising. Health care. Education. Public safety. Senior services. Affordable insurance. Better roads. Preservation of our natural resources. All are expendable when it comes to preserving and protecting their political interests. What these colleagues don't appear to realize is that those same services are not expendable, not for our Michigan residents and not for businesses that are considering relocating. While the majority may be willing to sacrifice these quality-of-life issues for corporate dollars, even most businesses are not willing to make the same sacrifice. What business owner would be willing to sacrifice quality education, affordable housing, accessible health care, good roads, first-class public universities and community colleges, and cultural and recreational opportunities for employees and their families, all for a lower corporate tax rate? That's not to say a favorable tax climate isn't a factor. But it is certainly not the only factor. And it will certainly not be the only factor when Michigan residents begin to feel the additional fallout from the Republican decision in the form of increased taxes and fees and decreased services. And, while it's being sold as an incentive for Michigan businesses, their families, too, will eventually suffer as well. That makes it lose/lose for everyone, folks--children, seniors, workers--Everyone will pay for this mistake.

Senator Allen's statement is as follows: I rise in support of the elimination of the SBT. As we know, our state is up against competition from the world, competition from other states, and competition from other regions. The SBT and the complicated calculation formula has been a major hindrance in its ability to attract jobs. Take a look at what we are competing against. States that you can go on the website, click on the county you're going to be locating in, calculate the volume of business you're going to be doing, and very simply, figure out what your taxes are going to be. Our MEDC, our organizations that are trying to attract jobs, literally have to take certified public accountants along to explain the SBT. As a small business person and one of the members of the caucus of individuals that has actually paid the SBT, the complicated formula, the inconsistencies on whether your business is making a profit or not, the number of employees has been a hindrance for small businesses throughout the state. I rise in support of this legislation and know that, as the time moves forward, we'll come up with a simpler, easier method of calculating business taxes on the citizens and businesses of this state.

Senator Toy's statement is as follows: It's time to say bye-bye to the SBT. What message are we sending? We are trying to attract even knowledge-based businesses to our great state and we have this onerous tax. As I look at my small business, and I've owned a small business for the last 28 years in this great state, I'm looking at rising costs and I'm looking at paying taxes on payroll. I'm looking at Medicaid. I'm looking at federal withholding tax. I'm looking at Social Security. I'm looking at state payroll tax. I'm looking at sales and use tax. I'm looking at workman's comp. I'm looking at personal property tax. I'm looking at higher insurance. I'm looking at higher prices on goods sold. I'm looking at 941 unemployment tax. That's what I pay as a small business in this state. It's time, ladies and gentlemen, to take a bold move today. It's time to put our money where our mouths have been for some long time in this state; to finally reach out and say, "We need jobs, jobs, jobs in this state." And we're not going to get those jobs if we keep sending out the wrong message on all these taxes that we charge these small business men and women. Yes, my district is asking for a lot of this. My district has repo houses practically every three blocks in some of my areas that can't even be sold in this environment. But yet we screen jobs. But yet we penalize employers. It's time, ladies and gentlemen, that we take the bold move; that we have confidence in ourselves that we will find helpful solutions and this will actually help attract businesses to this great state and make it even greater. It's time to say bye-bye.

Senator Cherry's statement is as follows: Cutting this tax without a replacement plan was a bad idea in March and it's a bad idea today. Many said in March, including the Flint Journal, that if lawmakers vote to eliminate the state's main business tax without simultaneously replacing the lost revenue, they are taking action, which is akin to a child failing to do his or her chores. We owe it to our constituents, to our kids, and to the businesses that we're leaving in the lurch to come up with a better plan than this. The action is not worth the job uncertainty, the massive cuts in critical programs, and the increase on individual's taxes that it will cost us. I call on my colleagues to take the time now to solve this issue now. One of my colleagues just said that we need the expertise of those who are in the Legislature who are currently serving to work on this problem now and I agree. Let's come up with the replacement now and then vote to eliminate the SBT with a solid replacement. Without that action, Madam President, I'm forced to vote "no." I can't support irresponsibility.

Senator Cassis' statement is as follows: A Wednesday in early August--what is it that brings the Michigan Senate into session? Colleagues, we've gathered in one of those rare moments in time where legislative history is going to be affected. Not since Proposal A have we been called to respond to such a compelling challenge. Have you seen the television program "What Not to Wear?" It shows a person, stuck with going about daily life wearing an outdated wardrobe, down emotionally and physically. Someone who cares recommends her to two fashion-savvy people who proceed to dump all her outdated clothes in the garbage can. Today, we throw away outdated and disfiguring tax garments that straightjacket our economy. The people of this state, through petition, through referendum, called upon us to retire this unattractive tax. They've told us our state deserves better--our families, our young people deserve better. Michigan is their home. Michigan is our home. Let us not shun those individuals and push them into the arms of more economically progressive states. In the "What Not to Wear" program, the makeover not only provides a complimentary wardrobe, but an entirely new outlook, a new mindset of confidence to face the future with optimism and purpose. Some in the administration and colleagues on the other side of the aisle will throw the alarm, try to scare us, that if we get rid of this burdensome, uncompetitive tax, we will lose our bond ratings. Colleagues, let us pledge together in one non-partisan spirit so that when we finish this long overdue task, Wall Street will be salivating, saluting us with salvos, welcoming a refined, well-heeled, Thoroughly Modern Millie--I mean thoroughly-modern tax code. The time is now. Be brave, be bold. While Republicans are upbeat, determined, Governor Granholm opined that a vote to repeal the SBT--the single business tax--would be "an act of extreme cowardice." Where has she been? Our esteemed cosmetic, fashion-conscious Governor is back in the '70s along with her treasurer, an SBT architect and admirer. Thirty-years ago the new economic grey flannel suit was the SBT. Today, the suit no longer fits. Some say just readjust its size, lengthen its sleeves, shift its lapels. I say we are embarking on an extreme makeover, not tweaks. Our sluggish economy cries out for a new fit, reflecting the changes that have occurred over the last 30 years. As chair of the Senate Finance Committee, I'm not talking about stylistic tax gimmicks, shifts or shafts, countless small and large employers. Our very job providers welcome County Executive Brooks Patterson's initiative. Let us move on and finish the task he started now and devise a lasting a garment, reflecting changing economic times. Its designers, we--the legislators--will draw a pattern, a new best practice Michigan, pro-job, pro-growth, and pro-business tax. Make no mistake, we are engaged--six of us--House and Senate, bipartisan, both sides of the aisle, in a select committee determined to craft a business tax code placing Michigan at the head of its class--strong, competitive, with low compliance, fair, and broadly based with a low rate. But we need all members to attend and to be on board. I happen to trust the elected representatives of the people to get the job done. Don't you?

Senator Garcia's statement is as follows: As I look around the chamber, it's pretty evident that most of us, if not all of us, have already made up our minds on what we are going to do here this morning, so most of the pontificating is primarily for the record and not really to change minds. What also bothers me about this discussion is that there is a lot of the-sky-is-falling arguments. We are going to eliminate prisons, we're going to eliminate over a dozen departments wholesale, or we are going to gut public education. Those are extreme arguments and not really realistic. What also bothers me about this discussion is that we are questioning one another's motives. It's an election year; we're doing it for politics. Well, none of us can really read each other's minds, and we shouldn't impugn each other's motives. So here's why I intent to vote to repeal the single business tax. I'm voting to repeal the single business tax because business owner's, those who are providing the jobs for our economy, are asking me to do so. They are struggling to survive this one-state recession. Whether or not it is a huge impediment to business that we believe it is, is beside the point. They believe it is, so it has to go because it is hurting our state. Now I personally would have preferred to phase it out over two to three years. The reason for that is that we would have then weaned ourselves off of that money. We would have learned to live without it, and we would not have had to replace it, but here we are. We are going to need to do it. We're going to need to replace it. So now we have to get serious about finding a replacement. It is our responsibility to do so and we will do it. We won't do it with the income tax or the sales tax because this chamber, at least this half of it anyway, passed House Bill No.5743, which would have kept us from doing this. Unfortunately, the Governor vetoed it. But now it is time to get this monkey off of our backs, repeal the single business tax and then do our jobs and find a replacement for it.

Senator Emerson's statement is as follows: This bill is about responsibility and whether or not we want to take responsibility for our own actions; whether or not we are mature enough to govern. I think this bill calls into question that because we have passed time and time again legislation saying we want to do away with the single business tax, yet nobody has come up with a plan to try and fix the problem. We've heard lots of discussion about it. Everybody has had some idea, but nobody can figure out a way to deal with this. This is more than just about getting it done; it's about getting it right. Unfortunately, this issue has a lot--the bill as it's written--of unintended consequences. We've had some discussion lately about the minimum wage legislation that was passed with about 30 seconds' notice. That had a number of unintended consequences. Anytime you do things like this that are quick fixes, but you haven't read clearly and don't know everything that it is doing, it's going to have some of those same unintended consequences. We have before us legislation that says we can't reduce payments to counties. It sort of implies that we can't also increase payments to counties. We can argue that that is not relevant, that any future Legislature can change that, but that is sort of the excuse that everybody has used for not taking up the K-16 proposal, which everybody on your side of the aisle has argued was politically damaging to the state because we would be putting into law some requirement for future payments. This does exactly the same thing, but since it was written by a county official, it does it for counties. If it had been written by a city official, I'm sure that it would do that for cities. If it was written by a school official, I'm sure we'd already have the K-16 proposal if it also reduced taxes and increased expenditures. But here we're doing that. It also says that we can't reduce future appropriations. How do you do that? I'm going to be happy to be leaving here because you're going to be stuck with the responsibility of trying to put together budgets and once you put together the budget, this says you can't reduce that budget. But you also have a constitutional provision that requires you to balance the budget. What are you going to cut? You can't cut the counties because this law tells you you can't. So you're going to have to go back in and change this law, just as we would have to change the law that deals with the K-16 proposal that nobody even wants to talk about and talk about any of our spending priorities. It seems to me that I've talked before about the whole fact that we ought to take responsibility for the things that we do around here. I'm willing to take responsibility and face the voters for everything that I do. In this particular case, we're giving the voters half of our decision and telling them to wait for the surprise later. Unfortunately, the surprise later is going to be a Legislature that is going to be unable, I think, to deal with this problem any better than previous legislatures have been able to deal with this problem.

Senator Sikkema's statement is as follows: Madam President, members, colleagues, we have waited too long. The time for change is now. But what we are doing today is not without precedent. In the summer of 1993, 13 years ago, one of the single, toughest issues plaguing the state of Michigan was the issue of high and rising property taxes--In fact, 40 percent above the national average--and a funding system for public education that was, by any stretch of the imagination and argument, inequitable. This Legislature and the people of Michigan had struggled with this issue for years and years and years. There had been at least a dozen ballot proposals prior to that time attempting to change the way we funded public education and to cut property tax and they all failed. A similar number of initiatives and proposals in the Legislature, either died in the Legislature or died at the Governor's desk, but the issue didn't go away. It was hurting the future of Michigan. It was hurting public education. It was a drag on business growth and investment. The Michigan Senate, not the House, understood that the only way to solve this problem after failure after failure was to force ourselves to do it. It was done on a bipartisan basis. The amendment was offered by a Democratic Senator and embraced by Republicans and Democrats alike--because the Senate and, finally, the House and the Governor agreed and understood that the only way to solve this vexing problem was to force a resolution. Now, there were critics at the time--some in the legislative bodies, lots of them writing editorials. There were critics and we heard the same hew and cry then that we have heard today. The Senator from the 10th District said it is easier to eliminate a tax than it is to create one. That is why we are doing this today. That is exactly why we have to do this because if we wait to create one, it will never happen. It's too hard. The Senator from the 23rd District said here we go again. Yes, that is exactly what we did. In fact, your predecessor, Senator, led the charge 13 years ago. That is exactly what we did 13 years ago to the betterment of the people of Michigan. I heard that Senator from the 4th District, the honorable gentleman--sits on a special committee looking for a replacement--I expect his recommendation, along with his colleagues by December 1st. The Senator from the 4th District pointed out that four years ago in 2002, we set the elimination date for 2009. He complains that we haven't come up with an alternative yet, precisely, because if you don't force it, it won't happen. The Senator from the Upper Peninsula, the 38th District said, "I've got a lot of questions about this." We had a lot of questions 13 years ago about how were going to fund public education. You know, some of the arguments that I've heard against this action, which were the same arguments that I heard 13years ago--I was in the House at the time--might be persuasive in normal times, but, ladies and gentlemen, these are not normal times for Michigan. We are not creating jobs; our economy is stagnant. We don't present a good picture for business growth and investment, and it's time for this legislative body to take some risks to change Michigan for the better. I've heard the phrase, as I heard 13 years ago, that eliminating a tax to fund vital services is irresponsible if you don't have a replacement right away. What I think is irresponsible is vetoing the change that Michigan needs today. Three of the most onerous features of the SBT of this state is that it taxes jobs, it's an immediate tax on new companies, and it taxes health care. Those are three of the most onerous features of the SBT. In 2004, Senate Bill No.1093 was sent to the Governor to eliminate taxes on new hires in Michigan, and she vetoed it. One of the most onerous features of the SBT could have been corrected by this Governor and she vetoed the bill, a fundamental change. The same month, May of 2004, she was sent a package of bills that said the future of Michigan will come from new companies. We sent her a package of bills that said let's make Michigan attractive by not imposing the SBT on new companies for five years. Let them get some roots into the soil of Michigan. She vetoed that series of bills. That was fundamental change of the SBT. But then last year, she vetoed a bill that would have finally put to death Michigan's health tax. The SBT taxes companies when they give their employees health care. I submit to you, ladies and gentleman, that if those three bills, initiatives, packages had not been vetoed in the last two and a half years, we might not be here today. It is time for change. One alternative that by implication that I hear from the people opposed to what we are going to do today is to wait. Wait until the SBT sunsets on December 31, 2009. I can't wait, we can't wait, and the people of Michigan can't wait. Is there a risk in doing what we are doing today? Yes, there is a risk in doing what we are doing today. Was there a risk in doing what the Michigan Senate did 13 years ago on school finance reform and property taxes? Absolutely, there was a risk, but, ladies and gentleman, the greatest risk is doing nothing and saying we can wait because this is too hard. We need a catalyst for change and economic recovery and this is it. It is time for change in Michigan and I rise to proudly support this initiative.

The famous 'we'll just cut taxes' and the economy will expand to fill the hole. 6 years of that sort of 'voodoo economics' from the Republican geniuses in Washington and where are we now ? Hugely in debt, unable to support basic services, corruption everywhere...But the Republican 'core constituency' - the super wealthy - are doing great while the middle class shrinks. And now we have the Republican morons here racing to repeat the same stupidity here. How about invading Canada ? They probably have some WMD somewhere... Time to kick these idiots out of office and get some people with some common sense (who can add and subtract, too) in there. Disgusted.

And throw these idiots out in November. They can't even balance their checkbooks and now they're messing with the state budget. Let's just toss $2 billion out the window and figure out (AFTER THE ELECTIONS) where to rob Peter to pay Paul. Just brilliant. Voodoo economics as practiced in Washington, now here in Michigan brought to you by the local Republican morons. Dick 'Amway' DeVos - another George Bush. He'd be filling vending machines somewhere w/o his crooked Daddy's money (how many Amway 'distributors' - AKA suckers - ever made any money ?). Now we have little Dickie trying to buy his way into office just like Dubya. Two rocks trying to mess up our country and state. Let's take our country and our state back from the incompetent morons.

how come is it that "voodoo economics" is working everyplace else other than michigan? we are having a "one state recession" here, and i don't see g.w. calling the shots in lansing. cutting taxes did wonders for the economies of the OTHER 49 states, why is michigan behind the curve here? could it be that it has a recessive tax policy? could it be that the laws here are restrictive to businesses, old and new? or could it be that the democrats are in charge? methinks it's a combination of the above, and you're right, it's TIME FOR A CHANGE. let's all vote republican, or even better, libertarian.

i see that only the democrats vote against this measure. why are they against a tax cut? why must they have all of our money? why can't they just SPEND LESS??????

100% of the vote against a tax cut comes from the democratic contingent. boy, those democrats really want you to pay more of your hard earned dollars to whatever they can come up with to spend it on.

you oppose this tax cut because you haven't yet figured out which tax you are going to impose to replace it??? how about CUTTING SPENDING????? that will reduce the NEED for a new tax.

a democrat actually used the "spending cut" word...

the tax in question has been a burden for years, yet you thought it was the best thing since sliced bread. let's see... how about cutting county gun boards for starters, and handgun registration, and there's that pesky, (and expensive) SAFETY CHECK thing that doesn't REALLY check for safety. sounds like a good place to START.

i wonder, to WHOM is it irresponsible? i'm sure that businesses would FLOCK to a state that collects fewer taxes. they sure aren't flocking HERE.

"The people of Michigan should not be forced to suffer because this legislature cannot do its job and offer up a replacement business tax right now, not some time in the distant future when Republicans decide it will not harm their chances in an the election." how about doing your job and cutting the need for this tax on business WITHOUT passing it on to the people. in other words, CUT SPENDING.

find 20% to cut out of this bloated states budget you probably couldn't find your butt with both hands. Lets elect folks that really believe in SMALLER GOVERNMENT. LESS HANDOUTS.

The democrats/liberals would never win another election if they lose the capability to pander to special interests.

"Voodoo economics as practiced in Washington, now here in Michigan brought to you by the local Republican morons" Your so called voodoo economics is working everywhere it is used. Maybe we should get on board. Answer me a question lib boy...If as you say the economy will grow if you take more of my money in taxes why is it that when you want to discourage something and slow it down the first thing you do is raise taxes? Kinda like the abortion is good but the death penalty is bad thing ain't it?

Note: The text of this measure appeared only in the House and Senate Journals. Here is that text: Department of State July 28, 2006 I, Terri Lynn Land, Secretary of State of the State of Michigan, certify that the attached proposed law appeared on the legislative initiative petition filed with the Secretary of State on May 30, 2006 by Repeal SBT, 124 West Allegan, Suite 800, Lansing, Michigan 48933. I further certify that on July 28, 2006 the Michigan Board of State Canvassers determined that said initiative petition contains “at least the minimum number of valid signatures required under Article 2, Section 9, of the Constitution of the State of Michigan of 1963.” I therefore submit to the Michigan State Legislature said legislative proposal for consideration as provided under Article 2, Section 9, of the Constitution of 1963. Sincerely, Terry Lynn Land Secretary of State INITIATION OF LEGISLATION An initiation of legislation to repeal 1975 PA 228, entitled “Single business tax act,” (MCL 208.1 to 208.145); to provide for the collection of taxes due under current law on business activity in this state through December 31, 2007; and to encourage the legislature to adopt a tax that is less burdensome and less costly to employers, and more conducive to job creation and investment. THE PEOPLE OF THE STATE OF MICHIGAN ENACT: 1. Purpose Sec. 1. The purpose of this initiated law is to: (a) Repeal the single business tax on business activity in this state after December 31, 2007; and (b) Encourage the legislature to adopt a tax that is less burdensome and less costly to employers, more equitable, and more conducive to job creation and investment. 2. Tax at Zero-Rate After Effective Date Sec. 2. The department of treasury shall prorate the liability for the tax imposed under the single business tax act as necessary to impose the equivalent of a tax at the rate of zero on business activity after December 31, 2007. 3. Affirmation of Existing Tax Liabilities Sec. 3. Except as specifically provided, this initiated law shall not affect the administration, allocation, or apportionment of the tax; payments to counties; nor any appropriation. The obligation of taxpayers and the state for taxes levied or collected on business activity on or before December 31, 2007 is affirmed. 4. Severability Sec. 4. This act is declared to be severable. 5. Repeal Enacting section 1. The single business tax act, 1975 PA 228, MCL 208.1 to 208.145, is repealed effective for tax years that begin after December 31, 2007.

"Michigan businesses pay around $1.8 billion in SBT,' Will they lower their prices when this tax goes away? No Will they pass on to consumers the 2 penny jenny plan. Yes. The only person that pays tax is the end user. Do away with this tax and DON'T replace it. Cut government and help business come to this state instead of being "Blown Away".