Michigan Votes Forum

Introduced in the House on January 22, 2009, to prohibit the granting of Transportation Economic Development Fund subsidies unless the beneficiary promises not to hire illegal aliens, to comply in good faith with the legal status verification requirements of federal law, to make a good faith effort to only hire Michigan residents and use Michigan suppliers and vendors on the project, and complies with the state “prevailing wage” law, which prohibits awarding contracts to contractors who submit the lowest bid unless the contractor pays so-called "prevailing wages" based on union pay scales in a particular part of a geographic region, rather than market rates. Violators could have their subsidies revoked and be required to repay all or part of them. An annual Transportation Economic Development Fund report to the legislature and the governor would have to give the number of residents employed by beneficiaries of these subsidies, and the specific reasons for each exemption granted from the proposed state-resident-job requirements

The vote was 71 in favor, 36 opposed and 3 not voting

(House Roll Call 52 at House Journal 0)

Click here to view bill details.

 

Senator Gleason, under his constitutional right of protest (Art. 4, Sec. 18), protested against the passage of House Bill No. 4094 and moved that the statement he made during the discussion of the bill be printed as his reason for voting “no.”

The motion prevailed.

Senator Gleason’s statement is as follows:

I would like to clarify the remarks of the Senator from the 25th District. This has been a longstanding concern that prevailing wage is incorporated in our projects, whether transportation or others in the state of Michigan. It’s because what is actually happening and why we need the Hire Michigan First is so that we can control those who are working on the jobs and those who are hiring the workers.

We should incorporate prevailing wage on this and components of the legislation for this reason: we know that many who get both public and private jobs do not necessarily pay prevailing wage. That is because they cheat on the classification of their workers. We cannot contain the cheaters if we don’t allow Michigan contractors to do this work. If those who are cheating on the 1099 forms, those who do the classification of the workers, pack up and go back to the other states, we can’t control the enforcement to the level that we should. Yes, prevailing wage is supposed to be used on these projects, but it doesn’t necessarily always happen that way

So I think we have to put in more stringent language, and I think that we tried to do that with the House version. But let no one in this chamber think that every job across this state involving transportation funding utilizes the prevailing wage because they don’t. It’s not too hard to look back and see recent contracts where that did not occur.

So I think we should be more consistent in the enforcement of the prevailing wage because of the aforementioned reasons. We do not enforce it to the level it should be today.

 

Senator Cropsey’s statement is as follows:

I wish to speak to this bill, and frankly, the whole package of bills in order to thank the chairman of the committee for the hard work that he did. I wish to thank the other side of the aisle for the hard work that they did. I wish to thank the other side of the rotunda for the hard work for that they did on this.

I have a basic question: s this going to be enforced? I ask for this reason: March 22, 2004, Executive Directive 2004-3 was signed by this Governor, a Democratic Governor of this great state of Michigan. I am going to read some of the pertinent parts: “1. Preferences for Michigan-based job providers and the procurement of goods and services. 2. Making procurement decisions in the best interest of the state of Michigan, Michigan workers, and Michigan job providers.” The Governor basically said that we are going to make sure that Michigan money goes to Michigan vendors and job providers if at all possible. This was an official executive directive from this Governor.

A little bit later, the next year and a half later, we have Executive Directive 2005-6 with a release date of September 1, 2005, and guess what? This executive directive signed by the same Governor a year and a half later says that procurement of goods and services and protection of Michigan jobs and jobs in the United States. It goes on to say almost the same thing, again, preferences for Michigan-based job providers and the procurement of goods and services. It says that making state procurement decisions in the best interest of the state of Michigan, Michigan workers, and Michigan job providers.

I guess I have to commend the other side of the aisle and the Democrats in the State House of Representatives for bringing to everyone’s attention the absolute abject failure of this current administration to make sure that Michigan job providers were going to be given preference in state dollars because it still isn’t being done.

I want to read to you a letter that I received from a constituent saying this. I won’t read the whole thing; it is very lengthy, but it says, “I am a small business owner, an independent distributor, living, working, and raising my family in Michigan. In January 2009 I was informed by an employee”—and I am going to leave out the name of the correctional facility—”where I have an account that I would no longer be needed to provide my product to them. A number of other Michigan businesses were given the proverbial boot as well. The products that our Michigan business provided were now being contracted through a company called Keefe Foods which is based in St. Louis, Missouri. This was very detrimental to not only my business, but many other Michigan businesses as well and as a business owner, I felt the need to investigate why or how this had happened. The following is what information I have been able to gather:

I was contacted by a representative of the company that wishes to remain anonymous. He said his company was not given the chance to bid on any contract until they contacted the state Corrections Department contact. This opportunity came only after asking the bureaucrat in the state Corrections Department several times. There was no bid or contract information on the state’s website for them or any other company.

After Keefe”—remember this was the out-of-state company that took away jobs from some of my constituents—”was awarded the contract, this company was not able to get, once again, the state bureaucrat to provide them with the results of the bids, even though they have requested the information on numerous occasions. I have been told that he is the state official who made the final decision to give Keefe the contract.

How can a state system replace Michigan companies without giving us the same opportunity that was afforded to other companies? What happened to the statement made in Lansing that business needs to be kept in the state?

I have been told by a legislator’s office that Keefe has established a business tax license in our state so that they could be considered a Michigan company. However, products that the state of Michigan receives from Keefe are shipped from a warehouse in Ohio. How many Michigan employees do they have? How many of the Michigan dollars that they make are being spent in our state versus Ohio and Missouri? How many real Michigan companies lost out?”

I can think of another example where we had a farmer providing fresh apples to our Corrections Department but now is no longer providing those apples because that account has gone to an out-of-state firm. I am just so pleased that the Democrats in this body have brought to our attention the failure of the Granholm Administration. Now I wish that they would go to Washington, D.C., and bring to everyone’s attention that Michigan is the automotive capital of the world, but yet, our economy is so tied into the automobile industry that we rise and fall with that.

Here we have a President of the United States who appoints a task force of 18 people, of which only 2 drive American cars. Now, if this Democratic administration in Washington, D.C., would start to encourage American people, perhaps even its own appointees, to drive American cars, we might be able to turn around Michigan’s economy.

Once again, thank you very much for what you have done here today, and just encourage members on the other side of the aisle to once again go to Washington, D.C., and encourage them to buy American products such as a General Motors, Chrysler, or Ford product.