Small Business Proposals Part of State of the State

The Governor’s State of the State address on Wednesday proposed very little in the way of new initiatives.  However, she did devote a portion of her speech to programs that would assist entrepreneurs.

The governor indicated that “one of the most effective ways to diversify our economy is to spur small business development.”

In that vein, she announced three proposals.

The first proposal fits in with SBAM’s long standing support of entrepreneurial education.  The MEDC will make a nationally recognized entrepreneurial training program available to 1,000 prospective entrepreneurs.  Participants would go though a 10-week, intensive training program where they learn markets, finances, collections and how to come out with a business plan.
The second proposal is a partnership with Michigan’s credit unions that would provide over $40 million in funding for start-ups.  The governor predicts that up to 2,100 new businesses will benefit from this effort.

Her last proposal would create a new tax credit for those who make venture capital available for businesses that need it to expand and create new jobs.

All of these proposals have been part of SBAM’s entrepreneurial agenda over the years.  We will report to you as more details become available.

Governor Proposes Government Reforms

Last Friday Gov. Granholm joined the chorus of elected officials and business groups calling for reforms to state government spending.  It is estimated that her proposed reforms would result in savings of $450 million.

Below is a list of some of the reforms that the Governor has proposed:
-  reduce costs by providing incentives to encourage 7,000 eligible state employees and 39,000 eligible public school employees to retire;
- increase state employee participation in a new health-care plan that maintains critical benefits for new state workers and their families while reducing the cost to state government by 21 percent;
-  eliminate lifetime health care for legislators;
-  continue reforming Michigan prison policies to reduce costs;
-  shift to a two-year state budget cycle;
-  audit state contracts annually and review all tax expenditures biennially to identify needed changes and savings;
-  implement pay-as-you-go budgeting;
-  give local government, school, university, and other public employees the option to participate in the state of Michigan's new, cost-effective health-care plan;
-  require competitive bidding of contracts and additional shared services among local governments and schools.

Already this week the House moved a bill to eliminate the lifetime healthcare benefits for legislators.

One problem with the governor’s proposals is that the state is facing a $1.7 billion budget deficit.  So her proposals only go part of the way to solving that problem.

The Senate Republicans released their reform proposals a couple of weeks ago, and the House Democrats are expected to make a reform announcement next week.

We will continue our efforts to work with elected officials who are looking to change the way the state operates, and keep you posted on any developments.

NSBA Releases Year-End Economic Report

SBAM’s national affiliate the National Small Business Association (NSBA) released its 2009 survey of small businesses last week.  Not surprisingly, economic uncertainty remains a key concern for small business owners across the country.

Highlights of the report yield some of the following results:

  • 64 percent reported a decrease in revenues (the highest since 1993).
  • 39 percent indicate that they are unable to get adequate financing for their business.
  • While 12 percent increased the number of employees during the year, 44 percent saw a decrease in the number of employees.
  • 52 percent expect growth opportunities in the coming year.
  • 24 percent expect to hire more employees, while 18 percent expect a decrease in their number of employees.

To access the full report please click here.

Election 2010

The shake-up on the Democratic side of who will run for governor this year has continued throughout the month.  Recall earlier this month, the presumed front runner for the Democratic nomination, Lt. Gov. John Cherry, decided not to run this year.

That created a whirlwind of activity and rumors regarding potential candidates that would run for governor.

State Representative Alma Wheeler Smith remains the only announced candidate for the nomination.

Two others who announced have since withdrawn.  State Senator Hansen Clarke declared as a candidate and then eleven days later withdrew.  Former State Representative John Freeman who was an announced candidate also withdrew. 

House Speaker Andy Dillon and Lansing Mayor Virg Bernero formed exploratory committees and are both likely to get into the race.

Congressman Bart Stupak, who had been considering entering the race decided to remain in Congress.  Joe Dumars decided to end the rumors circulating about him and reported that he would not be running.

There are still at least three others who are considering entering the race.  Denise Ilitch, a business executive involved with the Ilitch family holdings (Little Ceasars, the Detroit Tigers and the Detroit Red Wings,) is still mulling over the decision.

Dan Kildee, the nephew of Congressman Dale Kildee and a former Genesee County Treasurer, is weighing his options.

One other potential candidate has surfaced this month..  Bob Bowman, who served as State Treasurer under former Gov. Blanchard in the 1980s, and is now a successful business executive with Major League Baseball’s, is also considering getting into the race.

We would expect that the potential candidates will announce their intentions in the next month, so we will keep you posted.

State Senate Begins Hearings on Reform Proposals

SBAM came out in support of the first installment of the State Senate’s $2 billion in government reforms.  The bills (SB 1072) would amend the binding arbitration procedures for police and firefighters, and SBs 1085 and 1086 would ease the process for local governments to merge and consolidate local services.

The estimated savings from these measures is somewhere between $70 million and $118 million per year.  Both items are part of the list of reforms that our coalition of business groups has been discussing with legislators over the past few weeks.

Concerns were brought up from municipal officials that the bills still needed more work to provide more savings.  The committee intends to meet again next week to vote on the bills.

(Audio) Federal Health Insurance Reform Update on SBAM's Small Business Champion Podcast

In this week’s Small Business Champion podcast, Michael Rogers talks with SBAM’s health insurance expert Scott Lyon about President Obama’s state of the union address and the near-term prospects for federal health insurance reform.


Like this podcast? Share it with your friends and colleagues by using the social media links at the bottom of this story. And get engaged in the health insurance reform discussion in our member forum!