1 Peter Brimelow and Leslie Spencer, "The National Extortion Association?" Forbes, June 7, 1993, p. 74.

2 Section 2 of the Public Employment Relations Act (MCL 423.202) states "No person holding a position by appointment or employment… in the public school service... shall strike."

3 For reference, see the notes to MESSA's financial statements regarding related party transactions.

4 The MEA also operates the Michigan Education Association Legal Services (MEALS) program. MEALS was formed through a fund established by the MEA, the NEA, and the State Bar of Michigan, and began operating in 1974. The program was created as a negotiated fringe benefit in labor contracts which would provide pre-paid legal services to teachers.

5 Michigan Association of School Boards, "Questions and Answers About Health Insurance Bidding in Michigan's Public Schools," May 14, 1991, p. 2.

6 Michigan Association of School Boards, "Questions and Answers About Health Insurance Bidding in Michigan's Public Schools," May 14, 1991, p. 2.

7 Society of Professional Benefit Administrators, Directory of Third Party Administration Firms, 1993, p. 114.

8 For reference, see Section 501(c)(9) of the Internal Revenue Code.

9 Stated in the "Decision and Recommended Order of Administrative Law Judge" in the case of St. Clair Intermediate School District v. IEA/MEA and MESSA, MERC Case No. CU90 H-33,1992, p.3.

10 Peter Brimelow and Leslie Spencer, "The National Extortion Association?" Forbes, June 7, 1993, p. 81.

11 MESSA document, "MESSA Layoff Benefit Plan," dated July 12, 1982.

12 Brief of Appellant Michigan Education Special Services Association, IEA/MEA and MESSA v. St. Clair Intermediate School District, Michigan Court of Appeals Docket Nos. 161643 and 161645, p. 8.

13 The case of the Brandon School District, et al., v. Michigan Education Association, et al. (Insurance Bureau File No. 88-9510-L, September 6, 1985), was predominantly defended on the grounds that the Insurance Code does not apply to MESSA.

14 Houghton Lake Education Association v. Houghton Lake Board of Education, 109 Mich App 1 (1981)

15 MEA/NEA v. St. Charles Community Schools, 150 Mich App 763 (1986).

16 IEA/MEA and MESSA v. St. Clair Intermediate School District, Michigan Court of Appeals Docket Nos. 161643 and 161645.

17 For reference, see the "Governance Documents" of the Michigan Education Association (File No. 512840), last revised in May of 1991, available from the Office of Labor Management Standards within the U.S. Department of Labor.

18 Survey of MEA members, "MEA Evaluation," Greenberg-Lake: The Analysis Group, Inc., Washington D.C., March 1989, p.2.

19 Based upon information provided in the "Summary of Benefits" forms for various MESSA plans, distributed by the Michigan Education Association, dated April of 1990.

20 Houghton Lake Education Association v. Houghton Lake Board of Education, 109 Mich App 1 (1981).

21 MEA document: "MESSA and the MEA member in partnership together," dated April of 1989.

22 Peter Brimelow and Leslie Spencer, "The National Extortion Association?" Forbes, June 7, 1993, p. 82.

23 MEA document: "Labor Organization Annual Report, Form LM-2," filed with the U.S. Department of Labor, Office of Labor Management Standards, dated November 26, 1992, Item 38.

24 Houghton Lake Education Association v. Houghton Lake Board of Education, 109 Mich App 1 (1981).

25 Michigan Association of School Boards, "Helping Reduce Health Insurance Costs," MASB Summer Academies, 1991.

26 Memorandum from Reg Rye, Superintendent of Hemlock Public Schools, to Larry Engel, Superintendent of the Saginaw Intermediate School District, dated February 12, 1993.

27 For reference, see Brandon School District, et al. v. Insurance Commissioner, et al., Michigan Court of Appeals Docket No. 126891

28 MESSA document, "Notice: Information Concerning MESSA Health Plans," dated April 9, 1985, p. 7.

29 Calculated as follows: Five percent savings from elimination of Equitable rate increases plus seven percent savings from conversion to BCBSM.

30 Post-Hearing Brief of Charging Party St. Clair Intermediate School District, St. Clair Intermediate School District v. IEA/MEA and MESSA, Michigan Employment Relations Commission Administrative Law Court, MERC Case No. CU90 H-33, p. 13-14.

31 Petition for a Contested Case, Brandon School District, et al., v. Michigan Education Association, et al., Insurance Bureau File No. 88-9510-L, September 6, 1985, p. 12.

32 Beverly Wolkow, "Report on 1985-86 - Year of Many MEA Accomplishments for Members," The Voice, May 26, 1986, p. 2.

33 MESSA document, "Marketing and Service Program Agreement," dated August 3, 198 1, p. 2.

34 Michigan Association of School Boards, "Helping to Reduce the Cost of Health Insurance," MASB Legislative Relations Network, 1992, p. 16.

35 Michigan Chamber of Commerce, Property Taxes & School Finance: What Happens Next?, "Cost Containment," July 30, 1993, p. 8.

36 Michigan Association of School Boards, "Helping Reduce Health Insurance Costs," MASB Summer Academies, 1991.

37 Hospital Council of East Central Michigan, "Facts That Direct Policy," March 8, 1991, p. 5.

38 Michigan Association of School Boards, "Health Care Costs," MASB Legislative Relations Network, 1991, p. 20.

39 Excerpted from "Summary of Benefits" forms for various MESSA plans, distributed by the Michigan Education Association, dated April of 1990.

40 Peter Brimelow and Leslie Spencer, "The National Extortion Association?" Forbes, June 7, 1993, p. 82.

41 Richard Cantley, "A Report and Commentary on the Michigan Education Special Services Association: Prepared by a Michigan Taxpayer," 1991, p. 3.

42 Peter Brimelow and Leslie Spencer, "The National Extortion Association?" Forbes, June 7, 1993, p. 82.

43 Editorial, "The MEA's Sweetheart Deals," The Detroit News, March 7, 1993, p. 2B.

44 Mike Thompson, "Insurance Switch Keys Teacher Pact," The Saginaw News, June 2, 1993, p. Al.

45 Letter from the Michigan Association of School Boards to Attorney General Frank Kelley, dated October 6, 1989, p. 3.

46 Michigan Association of School Boards, "Helping Reduce the Cost of Health Insurance," MASB Legislative Relations Network, 1992, p. 17.

47 Letter from Deputy Comn-tissioner Jean K. Carlson of the Insurance Bureau to Robert Kasperek of BCB SM, dated December 15, 1992.

48 MESSA document, "Notice: Information Concerning MESSA Health Plans," dated April 9, 1985, p. 1-2.

49 Letter from the law firm of Fraser, Trebilock, Davis & Foster, P.C., to Comn-tissioner Herman W. Coleman, dated October 4, 1985.

50 Based upon information listed in "Michigan Education Special Services Association: Schedule of Operating Expenses," located as the last section of MESSA financial statements.

51 Peter Brimelow and Leslie Spencer, "The National Extortion Association?" Forbes, June 7, 1993, p. 82.

52 MESSA document, "Notice: Information Concerning MESSA Health Plans," dated April 9, 1985, p. 5.

53 Public Sector Consultants, "Health Care Costs and Mandated Benefits," Michigan Insurance Handbook, 1993, p. 107.

54 MESSA document, "Notice: Information Concerning MESSA Health Plans," dated April 9,1985. p. 7.

55 Public Sector Consultants, Michigan Insurance Issues Handbook, Public Sector Consultants, Inc., 1993, p. 111.

56 Blue Ribbon Committee on Health Care and Business, "Exploring Areas of Mutual Interest and Benefit," Hospital Council of East Central Michigan, March 8, 1991, p. 13.

51 Peter Brimelow and Leslie Spencer, "The National Extortion Association?" Forbes, June 7, 1993, p. 82.

58 MESSA document, "Background Summary," accompanied Insurance Bureau filing dated December 4, 1985, p. 1.

59 Letter from Fraser Trebilock Davis & Foster P.C. to Insurance Commissioner Herman W. Coleman, October 4, 1985. This letter discusses the Formula II document on file with the Michigan Insurance Bureau, which can also be obtained as a public document.

60 MASB Legislative Relations Network, "Health Care Costs," 1991, p. 20

61 For reference, see Section 8 of the federal Clayton Antitrust Act of 1914.

62 For reference, see the federal McCarran-Ferguson Act of 1945 and Michigan's Antitrust Reform Act (Public Act 274 of 1984).

63 Letter from Steven Hess of the BCBSM Office of the General Counsel to Wallace Long of Cox & Hodgman, P.C., dated September 4, 1992.

64 Letter from Wallace Long of Cox & Hodgman, P.C., to Commissioner David Dykhouse of the Michigan Insurance Bureau, dated July 6, 1992.

65 Letter from Keith Provost, Assistant Superintendent of Clawson School District to Senator Jack Welborn, dated May 22, 1991.

66 Letter from Iris Socolofsky of Fraser, Trebilock, Davis,. & Foster P.C. to Attorney General Frank Kelley, dated December 1, 1989.

67 Letter from Bridget E. Hughes of the Jardine Insurance Agency to Mara Jane Zodtner of the Troy School District, dated September 4, 1990.

68 MESSA document, "Employer Participation Agreement for Negotiated Group Benefit Programs," dated 1989.

69 MESSA document, "Employer Participation Agreement for Negotiated Group Benefit Programs," dated 1989.

70 MESSA document, "Employer Participation Agreement for Negotiated Group Benefit Programs," dated 1989.

71 Stated in "Decision and Order of Appeals Commission," in the case of St. Clair Intermediate School District v. IEA/MEA and MESSA, MERC Case No. CU90 H-33, p. 3.

72 The legal basis of this case pertained to a violation of Section 10(3)(c) of the Public Employment Relations Act, MCL 423.201 et seq.

73 Stated in the "Decision and Recommended Order of Administrative Law Judge" in the case of St. Clair Intermediate School District v. IEA/MEA and MESSA, MERC Case No. CU90 H-3 3, 1992, p. I 1.

74 Stated in "Decision and Order of Appeals Commission," in the case of St. Clair Intermediate School District v. IEA/MEA and MESSA, MERC Case No. CU90 H-33, p. 5.

75 Michigan Association of School Boards, "Questions and Answers About Health Insurance Bidding in Michigan's Public Schools," May 14, 199 1, p. 2.

76 Maureen Kelly and John Gierak, "Summary of Health Insurance Issue for the 1990-93 Troy Teachers Contract," Mosher, Vondale, Gierak, & Baumhart, P.C., July 9, 199 1, p. 9. National Education Association, "State Side: Midwest," NEA Today, April 1983, p. 7.

77 National Education Association, "State Side: Midwest," NEA Today, April1983, p. 7.

78 MESSA document, "Report on Financial Statements: Years Ended November 30, 1984 and 1983," p. 9.

79 Letter from the Michigan Association of School Boards to Attorney General Frank Kelley, dated October 6, 1989. ,

80 Letter from Richard Whitmer, President of BCBSM, to Stephen Wang, Assistant Superintendent of Mt. Morris Consolidated Schools, dated September 25, 1989.

81 Editorial, "The MEA's Sweetheart Deals," The Detroit News, March 7, 1993, p. 2B.

82 Copperweld Corporation v. Independence Tube Corporation, 467 U.S. 752 (1984)

83 MESSA document, "Articles of Incorporation," Section 11, as of September 9, 1960.

84 MESSA document, "Bylaws of Michigan Education Special Services Association," Article 1, Section 1, as of October II, 1985.

85 MEA document, "MESSA and the MEA member in partnership together," dated April, 1989.

86 Stated in the "Decision and Recommended Order of Administrative Law Judge" in the case of St. Clair Intermediate School District v. IEA/MEA and MESSA, MERC Case No. CU90 H-33,1992, p. 3.

87 MESSA document, "Bylaws of Michigan Education Special Services Association,". Article IV, Section 8, as of October 11, 1985. A quorum at all meetings of trustees is defined therein as "a majority of incumbent trustees." No motion may be passed without this quorum.

88 MESSA document, "Bylaws of Michigan Education Special Services Association," Article 11, Section 7, as of October 11, 1985.

89 MESSA document, "Bylaws of Michigan Education Special Services Association',". Article III, Section 3, as of October 11, 1985.

90 Sworn testimony of Beverly Wolkow; Post-Hearing Brief of Charging Party St. Clair Intermediate School District, St. Clair Intermediate School District v. IEA/MEA and MESSA, Michigan Employment Relations Commission Administrative Law Court, MERC Case No. CU90 H-33, p. 10.

91 Brief of Appellant Michigan Education Special Services Association, IEA/MEA and MESSA v. St. Clair Intermediate School District, Michigan Court of Appeals Docket Nos. 161643 and 161645, p. 8.

92 Stated in the "Decision and Recommended Order of Administrative Law Judge" in the case of St. Clair Intermediate School District v. IEA/MEA and MESSA, MERC Case No. CU90 H-33,1992, p. 9.

93 Post-Hearing Brief of Charging Party St. Clair Intermediate School District, St. Clair Intermediate School District v. IEA/MEA and MESSA, Michigan Employment Relations Commission Administrative Law Court, MERC Case No. CU90 H-33, p. 13.

94 MEA document, "Annual Report 76-77," dated 1977, p. 28.

95 Petition for a Contested Case, Brandon School District, et al., v. Michigan Education Association, et al., Insurance Bureau File No. 88-9510-L, September 6, 1985, p. 31. 96

96 Maureen Kelly and John Gierak, "Summary of Health Insurance Issue for the 1990-93 Troy Teachers Contract," Mosher, Vondale, Gierak, & Baumhart, P.C., July 9, 1991, p. 10.

97 Senator Jack Welborn, "The Fury of a Vested Interest," Right to the Point, May 9, 1991.

98 Letter from Iris Socolofsky of Fraser, Trebilock, Davis & Foster, P.C., to Attorney General Frank Kelley, dated December 1, 1989.

99 MEA document, "MESSA and the MEA member in partnership together," dated April, 1989.

100 MCL 423.202 (Section 2 of the Public Employment Relations Act) states "No person holding a position by appointment or employment...in the public school service... shall strike."

101 Stated in the "Decision and Recommended Order of Administrative Law Judge" in the case of St. Clair Intermediate School District v. IEA/MEA and MESSA, MERC Case No. CU90 H-33,1992, p. 10.

102 For reference, see Fraternal Order of Police v. Meridian Township, 90 Mich App 533 (1979); and Stephenson v. Golden, 279 Mich 710 (1937).

103 Brief of Appellant Michigan Education Special Services Association, IEA/MEA and MESSA v. St. Clair Intermediate School District, Michigan Court of Appeals Docket Nos. 161643 and 161645, p. 21.

104 Calculated as follows: Payments to MEA + Payments to MEDNA Revenues in excess of benefit costs [($1,549,000 + $28,500 + $8,285,000) -, $27,865,559] 35.4 percent

105 For reference, see the "Michigan Annual Report - Profit Corporations," filed by the Michigan Education Data Network Association with the Michigan Department of Commerce.

106 Information contained herein was taken from the "MEA/MESSA Marketing and Service Program Agreement," dated August 3, 1981.

107 MESSA document, "MEA/MESSA Marketing and Service Program Agreement," dated August 3, 198 1, p. 1.

108 Brief of Appellant Michigan Education Special Services Association, IEA/MEA and MESSA v. St. Clair Intermediate School District, Michigan Court of Appeals Docket Nos. 161643 and 161645, p. 9.

109 MESSA document, "MEA/MESSA Marketing and Service Program Agreement," dated August 3, 1981, p. 2.

110 MESSA document, "Addendum to the MEA/MESSA Marketing and Service Program Agreement," dated August 3, 1981.

111 MESSA document, "MESSA and the MEA Member in Partnership Together," dated April of 1989, p. 2.

112 MESSA document, "Addendum to the MEA/MESSA Marketing and Service Program Agreement," dated August 3, 1981.

113 MESSA document, "MEA/MESSA Marketing and Service Program Agreement," dated August 3, 1981, p. 2.

114 The MEA also receives a substantial cash flow from MESSA's annual rental payments. According to MESSA's financial statements, MESSA has been leasing a parcel of land from the MEA since April 1, 1975. The lease will expire on March 31, 2074. The annual base rate is $20,000, not including adjustments for inflation.

115 MEDNA document, "Articles of Incorporation," Article II, dated November 24, 1982.

116 Brief of Appellant Michigan Education Special Services Association, IEA/MEA and MESSA v. St. Clair Intermediate School District, Michigan Court of Appeals Docket Nos. 161643 and 161645, p. 9.

117 Based upon the figures for MEDNA's total income identified in the MEA's "Return of Organization Exempt From Income Tax: IRS Form 990," and MESSA's total payment to MEDNA for services identified in MESSA financial statements.

118 Mark Hornbeck, "State reviews teachers' insurance costs," The Detroit News, September 22, 1993, p. B 1.

119 Michigan Association of School Boards, "Memo to members of the MASB Legislative Relations Network," dated May 14, 199 1.

120 Determined from MEA PAC filings with the Bureau of Elections for the period covering January 14, 1991 to December 22, 1992

121 Governor Engler addressed the monopoly on health insurance for the school employees of Michigan in "A Prescription for a Healthy Michigan: Special Message on Health Care," dated March 11, 1992. Senator Jack Welborn has commented on MESSA in his "Right to the Point" column and in letters to his constituents. '

122 Despite numerous requests that his office investigate MESSA, Attorney General Kelley has avoided the issue. For example, Senator Welborn sent a request dated to January 27, 1990, to the Attorney General asking for an investigation of MESSA. Over a year had lapsed without a reply, and the Senator repeated his request to the Attorney General. An aide for Senator Welborn confirmed in June of 1993 that the investigation was expected to begin as soon as the Attorney General's office found the time.

123 Excerpted from a profile of NEA President Keith Geiger, printed by Concerned Educators Against Forced Unionism

124 MEA filing, "Statement of Organization, Campaign Finance Reporting," dated June 28, 1977, Section 7.

125 Excerpted from a profile of NEA President Keith Geiger, printed by Concerned Educators Against Forced Unionism

126 Letter from' Kevin S. Harty of Tbrun, Maatsch, and Nordberg, P.C. to Commissioner Herman Coleman, dated October 4, 1992.

127 Letter from Commissioner Herman Coleman to Kevin S. Harty of Tbmn, Maatsch, and Nordberg, P.C., dated October 9, 1985.

128 Letter from Thrun, Maatsch, and Nordberg, P.C. to Attorney General Frank Kelley, dated October 6, 1989.