Free Credit Freezes, Expel Student Sex Offenders, Release Frail Prisoners

March 9, 2018 MichiganVotes weekly roll call report

House Bill 5094, Ban credit bureaus charging for security freeze: Passed 35 to 1 in the Senate

To prohibit consumer credit rating agencies from charging a fee to place, remove or temporarily lift a security freeze on an individual who requests this. Under current law these agencies can charge $10 unless the consumer has filed an identity theft-related police report. The bill was introduced following a security breech at the Equifax agency that reportedly put 140 million individuals at risk of identity theft.

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Senate Bill 799, Require state revenue estimators to estimate prisoner counts and costs: Passed 36 to 0 in the Senate

To require the biannual state revenue estimating conferences to include estimates of the coming year’s prison population, prison capacity, payroll and cost per prisoner.

House Bill 5463, Ban selling or delivering nitrous oxide to minors: Passed 104 to 3 in the House

To ban selling or delivering nitrous oxide to individuals under the age of 18, subject to a $500 fine. Current law bans selling or delivering nitrous oxide (laughing gas) for purposes of getting high, but reportedly young people are buying N2O cartridges and devices that use it in food preparation applications.

House Bill 5531, Expel students who commit sex crimes: Passed 93 to 14 in the House

To expand the law requiring the mandatory suspension or expulsion of pupils for certain violence or weapons offenses to also include committing criminal sexual conduct against another student. Specifically, a student who is guilty of committing a criminal sexual conduct violation against another student would be prohibited from attending the same school as the victim.

House Bill 5407, Require defendant be present for victim impact statements: Passed 105 to 2 in the House

To require that the criminal defendant be present in court at the time a victim exercises his or her right under state law to make an oral victim impact statement in felony cases. The victim could also choose to have the defendant excluded.

House Bill 5234, Authorize probation for medically frail prisoners: Passed 99 to 9 in the House

To let county sheriffs request and a court grant probation for a prisoner who is physically or mentally incapacitated due to a medical condition that renders the prisoner unable to perform activities of basic daily living, and/or the prisoner requires 24-hour care. Also, to let county sheriffs ask and a court grant a compassionate release if a physician determines the prisoner is not expected to live more than six months.

House Bill 4101, Authorize parole for “medically frail” prisoners: Passed 94 to 14 in the House

To allow medically frail prisoners whose condition makes them “a minimal threat to society” to be paroled to a hospital, hospice, nursing home or other suitable accommodation for the balance of their term.

Senate Bill 353, Preempt local bans on employers asking about past wages: Passed 62 to 46 in the House

To expand a law that prohibits local governments from restricting what prospective employers can ask on a job application. Among other things a local government could not prohibit an employer from asking about a prospective employee's previous salary history during a job interview.

SOURCE:, a free, non-partisan website created by the Mackinac Center for Public Policy, providing concise, non-partisan, plain-English descriptions of every bill and vote in the Michigan House and Senate. Please visit

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Salt Bill Would Raises Prices On All To Benefit One Company

Senate Bill 363 is held up in the Michigan House

The Michigan Senate came together on a bill that raises costs for all citizens to benefit one select company.

That’s not exactly how most politicians would describe it, but that is the actual effect of Senate Bill 363. The proposed law requires the state to pay higher prices (up to 8 percent) on salt it purchases from other countries versus what it would pay to purchase salt from a company located in Michigan. It is believed that the only Michigan-based company that would benefit from an artificially higher price is the Detroit Salt Company.

This is pure protectionism. The key argument from proponents, noted in the Senate Fiscal Agency report on the bill, makes that clear:

One product that the state purchases is road salt, and one of the suppliers provides the salt from a mine located in Detroit. There are concerns that companies with mines in Canada are undercutting the ability of the company mining in Detroit to supply road salt based on pricing. According to some, this activity could result in the mine's eventual closure. To address this, it has been suggested that products mined in Michigan receive preferential treatment for the purposes of state procurement.

In other words, one company isn’t able to offer a product as inexpensively or efficiently as its competitors, so it has sought the help of politicians to protect it from rivals.

Singling out one company for special treatment is bad policy and does nothing to improve the state’s economy. While the idea may save or add a few jobs at the Detroit Salt Company, it will cost many more throughout the state because of higher prices. It shifts spending from a more productive area to a less productive one, benefiting the few at the expense of the many.

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Though the bill flew through the Senate, applause is due to Sen. Patrick Colbeck and Mike Shirkey – the only two “no” votes. But a coalition of business groups, local governments, salt haulers and truckers, unions and conservative groups has come out strongly against it. That has helped it get bottled up in the House Commerce and Trade Committee, where it should stay indefinitely.

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Put ISD Funding on Education Budget Table

While agency spending grows, Guv seeks student-based cuts

Gov. Rick Snyder has pitted a generous increase in overall student funding against cuts to certain kinds of educational services some families prefer. But it doesn't have to be an either-or proposition; there are other options that could be put on the table.

In particular, one sacred cow has been left out of the conversation: intermediate school districts. These 56 regional agencies provide various services within their set boundaries. One common function ISDs have is to oversee special education. ISDs directly serve about 1 percent of the state's public school students, most of whom are children with individualized education plans designed to meet their special learning needs.

The governor insists that funding must be cut for students who opt into cyber schools (charter schools that provide students with online instruction) or shared-time programs, in order to provide a larger formula increase for all other students. His executive budget estimates that these cuts to tilt the playing field will save the state about $90 million altogether.

But a 5 percent reduction in overall ISD spending would get nearly the same effect, without even pushing the agencies back to 2014 spending levels. As a whole, these regional agencies are spending more money and hiring more personnel at a faster pace than the districts and charter schools that serve most students. It isn't clear why ISDs should continue to enjoy most of the state's education funding increases while some of the choices families make are put on the budgetary chopping block.

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These regional agencies depend far more on local property tax dollars than do conventional districts, yet a great deal of extra funding has come their way from the state treasury in recent years. Fiscal year 2017 saw state funding to ISDs increase from $829 million to $880 million. That kind of annual growth is typical. The amount of inflation-adjusted dollars shipped to ISDs has nearly doubled over the previous decade.

ISDs send on to local districts about 40 percent of the money they receive, and the amount of money they keep for themselves is on a steep upward track. Today, 10 percent of all Michigan K-12 public education expenditures are spent by ISDs. Adjusted for inflation and the number of students enrolled statewide, ISDs spent nearly 42 percent more in 2017 than in 2006.

From 2012 to 2017, ISD payrolls also increased from 15,400 to 17,400 full-time equivalent employees — representing a 13 percent growth — all while directly serving slightly fewer students. The number of special educators employed by ISDs hasn’t changed much; most new ISD employees are classified as instructional aides or support staff, but the number of administrative personnel has increased by almost 14 percent over that time.

At the very least, ISD officials should have to publicly demonstrate how their burgeoning budgets and payrolls are helping students achieve more. Funding these agencies should not be a priority over ensuring fair funding for programs that families and students clearly want.

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Property Tax Revenue On a Slow Rise

Value of property increased 12 percent over past four years

The largest source of revenue for local governments is property taxes. They raised $14.0 billion for the state, schools, community colleges and local governments in 2017, a 2.42 percent increase from the previous year. Property tax revenues are approaching their 2007 peak of $14.3 billion. But with inflation, they would still be 13 percent below these peak levels.

That’s not bad considering that the tax is based on the value of property in Michigan. Assessed values dropped 31 percent from 2007 to 2013 when adjusted for inflation. This is the value of all real estate, including industrial and commercial properties. Things may have been even worse for homes. According to the Michigan Association of Realtors, the average home sold for $192,000 in 2005, but this dropped to $114,000 in 2011. Nevertheless, assessed values are on the upswing since 2013.

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A property’s taxable value cannot increase faster than inflation, a policy in the state constitution. But values are reset when a home is sold. This may explain why property tax revenue has lagged the increase in property values. But according to the Michigan Association of realtors, the number of home sales has been on the rise and is within 3 percent of 2005 peaks.

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March 2, 2018 MichiganVotes weekly roll call report

House Bill 4321, Authorize extra $160 million for road repairs: Passed 36 to 0 in the Senate

To appropriate $160 million from state general fund revenue to road repairs, and $15 million for "next generation technologies, hydrogen fueling stations, and demonstration projects related to enhanced transportation services for senior citizens." The bill also appropriates $7.4 million for other purposes, including $1 million for MSU sex abuse scandal investigations.

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House Bill 4430, Ban agencies from participating in federal metadata collection: Passed 37 to 0 in the Senate

To prohibit state agencies, local governments and their employees from assisting or providing material support to a federal agency in collecting electronic data or metadata concerning any person, except with a warrant (with some legally recognized exceptions), or with an individual's informed consent, or if the information had been collected legally by a state or local agency.

House Bill 4606, Revise medical marijuana law transport regulations: Failed 16 to 19 in the Senate

To repeal a law that bans transporting medical marijuana in a vehicle unless it is enclosed in a case or is in the vehicle’s trunk and is inaccessible from inside the vehicle. The citizen-initiated law that legalized medical marijuana is silent on transporting it, and a recent court ruling held that a person authorized to use medical marijuana cannot be prosecuted under a different law for transporting it. A motion to reconsider the vote was adopted so it may come up again.

House Bill 4535, Give 30 days “grace” to affix license plate tab: Passed 37 to 0 in the Senate

To authorize a 30 day “grace” period between the time a person pays the vehicle registration tax and when they actually affix the license plate or tab to the vehicle.

House Bill 5438, Define withholding drugs as human trafficking coercion: Passed 108 to 1 in the House

To expand the definition of coercion in a law addressing human trafficking, so it includes “controlling or facilitating access to controlled substances for no legitimate medical purpose.”

SOURCE:, a free, non-partisan website created by the Mackinac Center for Public Policy, providing concise, non-partisan, plain-English descriptions of every bill and vote in the Michigan House and Senate. Please visit

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February 23, 2018 MichiganVotes weekly roll call report

Senate Bill 798, Establish foster care alternative: Passed 37 to 0 in the Senate

To establish an alternative for court-ordered foster care that would allow a parent or guardian to sign a “safe families” power of attorney form delegating to another person (potentially but not necessarily a family member) the care, custody or property of a minor child for up to 180 days with no intimation of “abandonment,” subject to rules prescribed by the bill including background checks, home inspections and more.

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House Bill 4053, Establish English as official state language: Passed 62 to 46 in the House

To establish English as the official state language. This would apply to government activities, but not to private sector activity. It would require governmental documents, records, meetings, actions, and policies to be in English, but would not prohibit them from also being in another language.

Senate Bill 551, Give political branches input on Natural Resource Trust Fund spending: Passed 56 to 53 in the House

To establish a Natural Resources Trust Fund advisory board comprised of the Governor, the state Treasurer, the Senate Majority Leader, the Speaker of the House (or their designees) and one member of an existing NRTF governing board, which would make non-binding recommendations for annual spending and operation of the fund. State land oil and gas royalty money is earmarked for this fund, which acquires and develops more land for recreational purposes

House Bill 5190, Extend major sports event liquor licenses to golf: Passed 108 to 0 in the House

To extend a law that authorizes special liquor licenses for national sporting events, which allows the sale of liquor in designated theme areas related to the event. The bill would add the Professional Golf Association tournaments in 2018, 2019 and 2020.

House Bill 4321, Authorize extra $160 million for road repairs: Passed 109 to 0 in the House

To appropriate $160 million from state general fund revenue to road repairs, and $15 million for "next generation technologies, hydrogen fueling stations, and demonstration projects related to enhanced transportation services for senior citizens." The road repair money would be divided between the state and local governments according to the usual road tax allocation formula.

SOURCE:, a free, non-partisan website created by the Mackinac Center for Public Policy, providing concise, non-partisan, plain-English descriptions of every bill and vote in the Michigan House and Senate. Please visit

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Detroit Schools Will Sell to a Prison, But Not a Charter School

Moves criticized by parents and community members

The vacant Detroit Public Schools property.

After spending months fighting to prevent the sale of an abandoned building to a charter school, Detroit’s superintendent supports the sale of another property to a prison.

The Detroit Free Press reported last week that Superintendent Nikolai Vitti recommended accepting the sole $200,000 offer for vacant Detroit Public Schools Community District property from a developer in conjunction with a new Wayne County Justice Center. However, Detroit's school board narrowly rejected an offer to sell after member LaMar Lemmons insisted that the community did not want a correctional facility in the area. Two other board members joined him to stop the sale.

Community opinion didn't inform the district's attempts to keep an actual school from occupying one of its former buildings. On Nov. 30 Vitti told a legislative committee that DPSCD officials found a 2017 law against deed restrictions "problematic" in their fight to bar the sale of a former district building to Detroit Prep, a successful charter on the city's east side.

The superintendent blocked a property sale to a competing school, which some legislators saw as an attempt to flout the law. His actions come despite the neighborhood association favoring the new school location, and the school needing extra space to match its growth. But he apparently is now fine with selling property that will be part of a project to house convicted lawbreakers. While the Mackinac Center has no position on whether the district should sell a property to a correctional facility, the combination of moves certainly looks bad.

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As Detroit parent and education activist Bernita Bradley wrote: "New schools are a threat, but new prisons are the answer to helping DPSCD gain new funds. Wow! Is the war against charters really this serious for you?"

The good news is that DPSCD backed down from its legal fight when the state Legislature squeezed the last ounce of ambiguity out of the law banning deed restrictions on school properties. Detroit Prep reached an agreement with the district, and is now on track to remodel the building and move into it by December.

And, at least for now, a new Wayne County Justice Center will have to be built without former school district property.

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State’s MBDP Job Creation Claims an Inconvenient Fiction

Just because government says its effective doesn’t mean it is

As state budget discussions are underway, now may be a good time to revisit the state’s corporate welfare complex to search for scarce dollars that could be redirected to higher priorities. One area that could be examined involve subsidies that support the Michigan Business Development Program. This program takes money away from lots of people and business and gives it to a few in the hope it may create more jobs than might otherwise occur.

The Mackinac Center just yesterday released a study about the MBDP and it finds it does not, on balance, create new jobs. The state of Michigan thinks differently. It claimed last year that so many jobs will be created by the program that $10 in new personal income tax revenue will flow back to the state economy for every dollar it gave to companies in fiscal 2016.

The program gives subsidies, loans and other handouts to a favored few firms in exchange for promises to create jobs or make certain investments. It has offered up $300 million in 319 deals through fiscal 2016, though only about half of that amount has actually been disbursed. As part of state law, the agencies managing this program must produce return-on-investment analyses to help justify the program. They do this by using a software program known as REMI, which helps them measure the economic and fiscal impact.

Here’s out it works. The analyst plugs the pledged inputs — new jobs, compensation and investment, for instance — into the REMI software, which generates a report on expected outcomes. These estimates are done for each MBDP deal, summed up and averaged for the relevant state agencies (the Michigan Strategic Fund and the Michigan Economic Development Corporation) and the report they present to the Legislature each year.

The bad news is that companies often don’t live up to their pledges. Companies that get deals in one year may fail, and in the next year see their agreement terminated. That means the agencies’ annual report to the Legislature shows the effects of successes that turn out to be failures. Yet when that next year’s report comes around, it doesn’t mention that the previous ROI estimates were too high. Such an omission may lead lawmakers and others to believe the program is more successful than it really is.

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It’s fairly common for companies to fail to live up the terms of their deal. In the previous three legislative reports 34 companies are shown to have had their deals revoked. A spokesperson for the MEDC said that at least eight more revocations will be included in the 2018 report. Not all failures are due to company performance short comings, but many are. The fiscal 2016 report detailed nine revocations, and eight involved a company’s failure to meet some milestone or parameter of its agreements with the state.

That’s only a portion of the problem. Around a third of MBDP deals have been or are in some stage of default and dismissal (revocation). Sometimes the company may turn it around and at other times, it will not. Even then, some companies on the fringe of failing to meet some stipulation in their agreement with the state may ask for their deals to be amended. In the MSF-MEDC fiscal 2016 report to the Legislature, 38 amendments are offered up and 28 of them appear to lower some performance standard such as the expected number of jobs to be created.

The Mackinac Center for Public Policy’s new study, titled “An Assessment of the Michigan Business Development Program,” eschews projections for historical fact. We built a statistical model based on workforce data at the county level and reports from state agencies from 2012 through 2016 in an attempt to isolate the impact of this program on the number of jobs. We find that for every $500,000 in disbursed funds, there was a loss of more than 600 jobs in the county in which MBDP projects were located.

Our economic analysis shows that this state program doesn’t create jobs but rather costs them. It should be eliminated.

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Snyder's proposal undercuts cyber school, shared time options

Last year Gov. Rick Snyder failed in his attempt to reduce funding for full-time online students. Rather than seek an equitable solution, the governor is now using his final budget proposal to double down on the attack and penalize certain parental choices.

The core of Snyder's education budget pitch is a significant boost to Michigan's foundation allowance. That’s the money which the state gives on a per-pupil basis to serve as a guaranteed floor and revenue source for K-12 public schools.

The current school funding system, enacted with Proposal A in 1994, was designed to achieve greater equity between districts with differing levels of taxable wealth.

To his credit, Snyder's proposal builds on the 20-year trend, giving most of the lower-funded districts an extra $240 per pupil compared with an extra $120 per pupil for the small number of districts at the high end. But he pays for those funding increases by reducing payments for students who choose certain kinds of schools or programs.

Snyder's proposal recommends cutting the foundation allowance by 25 percent for the roughly 10,000 Michigan students enrolled in one of 14 cyber schools. State Superintendent Brian Whiston backs the governor's call, telling a news outlet, "We want to make sure that we're paying for it fairly, and that allows more money to go to all students around the state."

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Snyder called for cutting the foundation allowance for cyber schools by 20 percent in 2017. The justification didn't add up. His second attempt to cut funding — by an estimated $25 million, this time – certainly doesn't either. His executive budget cites research that says it costs 23.8 percent less to run a cyber school than a conventional brick-and-mortar school. But the budgets of cyber schools are already that much lower, if not more, mainly due to disparities in funding sources outside the foundation allowance, where districts have an advantage.

In 2016-17 cyber schools took in 71 percent of the total per-pupil revenues of an average school district. Just comparing the costs of operations rather than capital and debt service costs, these online schools still only spent 78 cents on the dollar. Widening the gap through cutting the foundation allowance would be truly unfair, leaving cyber schools to get by with less than 60 percent of what districts receive in total per-pupil funding.

Full-time online school may not be the best choice for most students and families, but for some it has proved to be a true lifesaver. Still other families are eager to enroll their private- or home-educated children in flexible district programs that offer elective courses. A growing number of districts have created homeschool partnerships and shared-time programs to reach more students and, in some cases, to learn innovative approaches that help them serve all students better.

Yet Snyder's proposal would greatly restrict how many students a district could serve though these programs, no matter how great the demand. It includes a mechanism to keep any district from having more than 5 percent of its students enrolled in an online program, which would cut funding for such programs by an estimated $68 million statewide. Artificially capping participation would leave it to the districts to decide who to turn away, or perhaps to figure out how to keep the programs going at all.

Snyder's office appears intent on giving legislators a stark choice between his full foundation allowance increase (an extra $312 million) or standing with parents who have chosen from the options of a cyber school, partnership or shared-time program.

If legislators need other education budget items to roll back, they should look first at the political projects in some of the state's existing categorical grants. The governor's proposal streamlines the number of categorical grants but does very little to reduce their overall funding.

Lansing leaders have a chance to challenge the governor's proposal and stand by student-based funding that more closely follows families' choices and priorities.

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Michigan Is Not a Windy State

The true cost of wind in Michigan is beginning to become clear

Michigan is not a windy state, but you wouldn’t know it from the actions of state regulators. Michigan’s Legislature has favored the wind industry, mandating that an increased portion of energy produced in the state must come from wind. These mandates are typically advanced under the assumption that energy produced by wind will eventually become competitive on price. That seemed true for a while, but lately wind energy prices have been stuck in neutral or even started to increase in Michigan. Unfortunately, it seems unlikely prices will improve with protective federal tax provisions being phased out and with the best locations for wind farms already occupied.

A key aspect of Michigan energy policy is the renewable energy mandate. First enacted as Public Act 295 in 2008, the law required electric utilities to ensure that 10 percent of their retail electricity sales are sourced from renewable options. That mandate was expanded in December 2016 by Public Act 342, which requires utilities to obtain 15 percent of their electricity from renewable sources by 2021.

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Today, the majority of renewable generation in Michigan is provided by wind and biomass sources, which — according to the Energy Information Administration — provide approximately 53 and 28 percent of Michigan’s renewable energy, respectively. Hydroelectric provides almost 18 percent and solar provides less than 1 percent.

The renewable energy mandate has been responsible for much of Michigan’s interest in expanding wind power. When combined with the generous federal subsidies, there has been significant artificial incentives to build wind generation facilities. Michigan taxpayers and residents pay for these policies and this development through federal taxes and renewable energy surcharges on monthly electric bills.

Energy experts always expected renewable energy costs to start out high; advocates argued that this was a relatively new industry that needed to get its feet under itself. But ratepayers were assured that early economic and policy support wouldn't be needed for long. Once sufficient experience was gained building and operating wind installations, energy produced by wind would drop in price and begin to outcompete other options.

Initially, those predictions appeared correct. From 2010 to 2012, contract prices of utility wind projects dropped substantially. But, in Michigan, price decreases stalled for four years and, in 2016, they actually increased. A recent wind contract — for the Pine River wind park near Alma — compounded price issues. This contract, one of the most expensive wind contracts signed in the U.S. in 2016, actually pushes Michigan wind prices back up to almost $60 per megawatt-hour.

To put this price in perspective, the investment group Lazard annually reports on the levelized cost of electricity. Their 2017 report describes expected market prices for wind of $30 to $60/MWh. Contract prices in Iowa and Oklahoma are as low as $20 per MWh, one third the price of wind in Michigan.

Michigan Weighted Average Wind Contract Cost Comparison Prices ($/MWh) Source: 2017 PA. 295 report.

The differences in price exist largely because the best wind resources in Michigan would be considered some of the worst wind in Iowa. Wind speed maps demonstrate this reality and show that the only areas in Michigan with wind speeds comparable to interior states like Iowa and Oklahoma are in the middle of the Great Lakes. But building offshore wind turbines is both unpopular and significantly more expensive.


Utilities and wind developers know where to find the best onshore wind resources, and that’s why Michigan’s wind farms were preferentially located in Huron, Tuscola and Sanilac counties. Michigan’s remaining counties have average wind speeds at the low end of wind resources found across the nation.

The Michigan Public Service Commission, the state office charged with overseeing Michigan’s electricity system, added to these challenges with its September 2017 ruling. Starting in 2022, a minimum percentage of electricity used in Michigan will need to be produced in Michigan – something called a local clearing requirement. That ruling may force Michigan residents to buy $60/MWh wind energy that is produced in Michigan instead of the $20/MWh wind energy being produced in other states.

Expanding wind development in Michigan is becoming an increasingly expensive proposition for Michigan residents. If wind energy were not subsidized and not mandated, but still made economic sense given wind resources and market conditions, there would be reason to celebrate the growth of this industry in Michigan.

It increasingly appears that wind energy is produced in Michigan only because politicians are forcing it into the system. High contract prices are obviously attractive to utilities and wind developers. But the costs of this policy are being passed off to ratepayers and taxpayers. The numbers are not adding up for more wind development in Michigan, so it’s time for legislators to reconsider the state’s renewable energy mandates.

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