Mid September 2024 Newsletter

DEMS TOUT PRICE GOUGING BILLS AS A FALL PRIORITY
Democratic lawmakers said that strengthening price gouging protections for consumers is a fall priority and they hope to gain bipartisan support for law changes they said are several years in the making.

"The reality is, is that we have left Michiganders vulnerable for way too long, and it’s long overdue to strengthen Michigan’s price gouging statute," said Sen. Jeremy Moss (D-Southfield). 

During a Tuesday roundtable discussion inside the Capitol on price gouging with reporters, Moss, other bill sponsors and Attorney General Dana Nessel stressed the need to protect consumers from businesses and individuals seeking to take advantage of residents during emergency situations.

Moss said the issue for him goes back to a March 2017 windstorm that knocked out power for many state residents. He referenced constituents telling him of a local hotel in his district that was reportedly gouging residents, charging up to $400 per night for what was typically advertised as $59 per night rooms.

He said the governor later used the framework of bipartisan-sponsored legislation introduced in March 2020 for an executive order addressing price gouging during the early months of the coronavirus pandemic.

"We still have to codify the framework of that into law, because it was demonstrated to be effective and it was used as a safeguard for consumers from unreasonable price increases during the pandemic," Moss said.

Moss and Sen. Mary Cavanagh (D-Redford Township) introduced SB 954, SB 955, and SB 956 on June 26.

Collectively, the bills would set a 10 percent cap on price increases during a state of emergency before an individual or business would be liable for price gouging, with exceptions. The bills focus on lodging, the cost of goods and emergency supplies as well as energy products including gasoline.

The exception for lodgings is if the owner of the lodging can prove the increase is due to the increased cost of goods and labor in conducting business or a regularly scheduled seasonal adjustment. For the other products, the exception is if the person selling the items can prove the cost increase is based on the cost of bringing goods to market.

Individuals who commit violations under the bills would face a maximum misdemeanor penalty of one year’s imprisonment and a civil fine of $10,000, while business owners would face a maximum misdemeanor penalty and civil fine of $1 million.

The attorney general could also under the bills bring a class action lawsuit on behalf of those affected by price gouging to recover actual damages or $100, whichever is greater.

A similar House package (HB 5895, HB 5896 and HB 5897) was introduced on July 30 by

Rep. Jason Hoskins (D-Southfield) and Rep. Laurie Pohutsky (D-Livonia).

The legislation is similar to a bipartisan Senate bill package introduced in March 2020 during the early days of the coronavirus pandemic (See Gongwer Michigan Report, March 27, 2020).

Hoskins said 34 states and Washington, D.C.,have some form of price gouging laws in place. The Michigan bills are drawn from language from multiple states across the country.

"I think we have a piece of legislation that we can all be proud of, and I think would truly protect consumers around the state," Hoskins said.

Cavanagh said the proposed changes are much-needed improvements in statute.

"This legislation not only sends a clear message about the values of our state, but also around consumer protection but also gives the government the tools necessary to take on those bad actors," Cavanagh said.

Pohutsky called the early months of the pandemic "a case study in the weakness of our laws."

"There have been countless emergencies during my time in office, and each time there are consistently bad actors that engage in price gouging and take advantage of an already vulnerable situation," Pohutsky said.

Nessel said existing law only covers investigations and enforcement involving single sellers in which they raise their prices excessively above those of comparable sellers in the surrounding area. When a community of sellers is involved, she said it renders her office toothless.

"In the bills package, we equip the state attorney general’s office and local county prosecutors with additional investigative enforcement authority," Nessel said.

ADVOCATES CONTINUE TO MAKE THEIR CASE ON TIPPED WAGE
The discussion around tipped wage continues to generate a lot of buzz in Lansing, with supporters celebrating the Michigan Supreme Court’s decision earlier this summer that ruled the Legislature’s adopt and amend tactics in 2018 were unconstitutional and those who oppose the changes pleading with the Legislature to make changes before the law is set to go into effect in February.

This week on MichMash, the podcast partnership between Gongwer News Service and WDET Detroit Public Radio, both sides of the issue made arguments for and against the law.

Justin Winslow, president and CEO of the Michigan Restaurant and Lodging Association, said the law has the potential to destroy many of Michigan’s sit-down restaurants.

"The tip credit really means life or death for a lot of full-service restaurants, dine in restaurants," he said.

Winslow said that in states where there isn’t a tipped wage people tip less.

"West Coast states have a higher based wage, but a lower tip percentage," he said. "For servers, the cumulative income is higher with a lower base in Michigan than it is in a few of these other states, almost all of them."

Most servers would prefer the inconsistency with a higher earning potential, Winslow said.

"The upside opportunity to be an entrepreneur, to make that kind of cash – when they bring it, they usually get rewarded well, or doing their job well," he said. "They’ll take that over consistency with a lower ceiling every day of the week."

On the other hand, Chris White with the Restaurant Opportunities Center, which advocated for the ballot initiative in 2018, said the arguments that changing tipped wage would reduce take-home pay for servers were scare tactics.

"I have never asked a waiter or waitress how much they make an hour before I tip. I tip based upon service," White said. "If you ask the everyday citizen, do they know how much a waiter or waitress makes an hour, they would assume that they make minimum wage like everyone else."

The bottom line is that changing the laws set to go into effect in February would damage public trust, White said.

"The Legislature already adopted and amended it, and then we went through the courts all the way to the top, and they found it as unconstitutional," White said. It was done to us by a Republican Legislature, if it’s done to us again by a Democratic Legislature, then that erodes public trust. We’re concerned about what it would do about voter turnout and civic engagement."

MICHIGAN SCHOOL ATTENDACE IMPROVES SLIGHTLY FOR SECOND YEAR IN A ROW
During the 2023-24 school year, Michigan’s students increased their attendance rates and saw a decline in chronic absenteeism from school for the second year in a row, new data from the Department of Education shows.

The data released Friday shows the statewide attendance rate among Michigan students increased from 90.5 percent to 90.8 percent. The chronic absenteeism rate declined by 1.3 percentage points, from 30.8 percent to 29.5 percent. The state defines chronic absenteeism as a student missing 10 percent or more of the school year – roughly two school days a month – for any reason.

MDE officials said while the numbers are encouraging, there’s still a lot of work to be done, especially to further decrease the chronic absenteeism rate.

"Efforts by Michigan school staff, students, and parents continue to help improve attendance and reduce chronic absenteeism," Superintendent of Public Instruction Michael Rice said in a statement. "Our students need to attend school regularly to maximize their school experiences. Despite our progress, far too many students are chronically absent. We need to work together to redouble our efforts and remove barriers to school attendance."

Local school districts have engaged a variety of different methods to combat chronic absenteeism, including calls to parents, conferences with families, mental health interventions, and door-to-door outreach to visit students’ homes to "help reacclimate children to coming to school more frequently."

"We must continue to improve attendance to strongly address Goal 5 of Michigan’s Top 10 Strategic Education Plan, to increase the percentage of students who graduate from high school," Deputy Superintendent Delsa Chapman said in a statement. "Credit for the improvements in attendance goes to our local school districts."

Chronic absenteeism decreased across all grade levels and most racial and ethnic groups, but students who are economically disadvantaged still have a higher rate of chronic absenteeism at 40.1 percent.

In the 2022-23 school year, Michigan’s chronic absenteeism fell 7.7 percentage points compared to the year before, the biggest improvement from among 42 states and Washington, D.C., that released attendance data that year.

ARTICLES OF POLITICAL INTEREST:

Michigan Gas Prices May Drop as Refineries Switch to Winter-Grade Fuel

Soaring Egg Prices in Michigan Put Squeeze on Families, Small Businesses

Democrats Put Up $25M to Reach Voters in Michigan, Other States in Fight for Senate Majority

A Contentious Race to be a Tiny Michigan County’s Top Election Official

Michigan Politicians Respond to Second Assassination Attempt on President Trump

Marijuana News, Updates, & Articles of Interest

THE DCD MARIJUANA TEAM:  YOUR COMPETITIVE EDGE!

DCD continues to exist as the premier resource helping municipalities navigate the waters of cannabis policy. We would be more than happy to answer any questions you may have regarding medical or recreational cannabis policy, procedure, and more. DCD is available for presentations to municipal boards, for one-on-one meetings, and for consultations.

We are here to help you with: municipal lobbying, license application writing and assistance, business plans, state required operations manuals and compliance, facility design, corporate structure, and design and branding. 

We are experts in both medical and recreational cannabis policy and have been in the space for over ten years.  We welcome any opportunity to work with you in the future!

ARTICLES OF CANNABIS INTEREST:

Michigan Marijuana Sales Increase as Ohio Joins the Recreational Cannabis Market

Michigan Sets Record with $295.4 Million in Monthly Marijuana Sales

27% Of Older Adults in Michigan Have Used Cannabis in Past Year, U-M Study Finds

COA: Voter Initiated Charter Amendments Cannot Be Used to Implement Local Regulations Under MRTMA

Is Marijuana Outpacing Alcohol?

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