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For The Week Of January 6, 2018 Through January 12, 2018

Success For Self-Funded Candidates In Michigan A Mixed Bag

By Nick Smith
Staff Writer
Posted: January, 12 2018 5:33 PM

Each election season brings candidates who opt to primarily use a sizeable chunk of their personal fortune to fund their campaigns for higher office.

This year is no different in Michigan politics, with U.S. Senate candidate Sandy Pensler, a business executive, entering the Republican primary and dropping $5 million into his effort.

Quickly the campaign of U.S. Sen. Debbie Stabenow (D-Lansing) cried foul in fundraising email blasts, accusing Mr. Pensler of trying to buy a Senate seat. Mr. Pensler has called Ms. Stabenow ineffective while in office and says the infusion of funds is necessary to get his message out since the incumbent has nearly $7 million in the bank already for the race.

Such efforts to quickly get a large-scale campaign rolling and the countering accusations are par for the course in Michigan and nationally. The trend toward federal and state candidates choosing to risk large sums of their own money grows more common with each passing cycle.

The Washington D.C.-based non-profit, nonpartisan research group Center for Responsive Politics, has a well-compiled list of self-funded candidates for U.S. House, U.S. Senate and presidential candidates for each election cycle dating back to 2000 at www.opensecrets.org. Candidates listed are those who put in $500,000 or more of their money in a race.

The list is compiled based on Federal Election Commission campaign finance reporting data and lists several Michigan examples of candidates tossing in six and seven-figure sums for congressional races.

Most recently, U.S. Rep. Paul Mitchell (R-Dryden Township) won the 10th U.S. House District seat in 2016 by spending more than $3.6 million of his own money.

In 2014 it was a similar story for U.S. Rep. David Trott (R-Birmingham), spending $3.62 million of his own money to win the 11th U.S. House District seat.

Meanwhile, former Secretary of State Terri Lynn Land lost to now-U.S. Sen. Gary Peters (D-Bloomfield Township) after spending $3.6 million of her own money.

Mr. Mitchell lost the GOP primary in an earlier bid for the 10th U.S. House in 2014, putting $3.56 million into that year’s race, while Grand Rapids businessman Brian Ellis self-funded just over $1 million in an unsuccessful 3rd U.S. House District primary against U.S. Rep. Justin Amash (R-Cascade Township).

In 2012, former Democratic state Rep. Steve Pestka of Ada spent $1.6 million in his loss to Mr. Amash.

In 2006 former Detroit city councilman Keith Butler put more than $544,000 into a failed Republican U.S. Senate primary to Oakland County Sheriff Mike Bouchard, who went on to lose to … Ms. Stabenow.

And Detroit-area lawyer David Fink, a Democrat, dropped $1.2 million into a failed 9th U.S. House District bid in 2002.

Gubernatorial races in recent years are a mixed bag as well, with Dick DeVos spending tens of millions in his failed 2006 bid against former Governor Jennifer Granholm and in 2010 Governor Rick Snyder spent $6 million to win his race. And in this election cycle, Shri Thanedar has put $6 million into his bid for the Democratic nomination for governor, though he has spent a fraction of it so far.

Candidate quality, overall campaign, a candidate’s opponent and the prevailing political winds are all key factors in whether or not a self-funded candidate can succeed. The debate over “buying” a political office or being well-funded to get one’s message out is also common and bound to happen.

Between 2000 and 2016 nationally, the success rate of candidates putting $500,000 or more of their own money on U.S. House, U.S. Senate or presidential campaigns is 18.6 percent out of nearly 390 total candidates.

The odds are long, but it does happen, and opting to go that route has a mixed track record in Michigan of getting one across the finish line. Something to chew on as races begin heating up.

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The Game Of Which Congressperson Do We Lose

By John Lindstrom
Publisher
Posted: January, 11 2018 3:02 PM

We are now less than three years before finding out officially that we will lose a member of Congress. Yes, Michigan’s population has grown, which is good when the country is growing, but not as fast in relationship to other states to prevent us from losing at least one seat in the U.S. House of Representatives. If we see a big upsurge in growth over this year, 2019 and the first few months of 2020 we might be able to stave off a loss and stay at 14 seats, but not, at this moment, is that likely.

Which brings us back to the lamentable game we as a state have had to play since 1980: which congressional seat, which congressional member do we lose. We went from 19 seats to 18 with the 1980 census, to 16 with the 1990, to 15 with the 2000, and the current 14 with the 2010 census.

Before looking at that more closely, here is a side game. And here is the answer: U.S. Rep. Fred Upton (R-St. Joseph).

The question is: In January 2019, which Michigan congressperson will have served continuously for more than a decade? Mr. Upton, presuming he runs and presuming he wins, will be the only one. Yes, Rep. Tim Walberg (R-Tipton) was elected in 2006, but he was then defeated in 2008 before returning with the 2010 election. While he will have served at least 10 years, it has not been continuous.

That speaks to the stunning change that has occurred to Michigan’s delegation. The longest-serving member of the U.S. House, former Rep. John Dingell, decided against running in 2014. Former Rep. John Conyers was the dean of the House until claims of sexual improprieties forced him to resign last month. And then U.S. Rep. Sander Levin (D-Royal Oak), who has served for nearly 40 years, announced he would not seek re-election. And add to that former Republican U.S. Reps. Dave Camp and Candice Miller as well as former Democratic U.S. Rep. Bart Stupak leaving office and since 2000 nearly 200 years of congressional service from Michigan has ended.

And not just years of service, but real power. The representatives who have left Congress were the chairs and ranking members of major committees. Until the last session, Mr. Upton was chair of the Energy and Commerce Committee. Now no Michigan representative is a committee chair.

Which means what when we get down the shedding part of the game? Two caveats. One, there is always the chance someone will decide not to run in 2022, that makes the task easy. Second, the answer could be complicated if the Voters Not Politicians redistricting proposal win at the polls in November. It is very hard to say what it could mean in terms of how lines will be drawn and who will be the odd congressperson out.

If it doesn’t pass, and the Legislature is left to make the redistricting decisions, the fact that most Michigan’s delegation are newbies means there are very few powerful names to protect. Not that the Legislature was always worried about protecting persons, such as when Mr. Dingell had to square off against Democratic colleague former U.S. Rep. Lynn Rivers after they were tossed together in a district.

But add term limits to the mix and very few if any lawmakers drawing lines in 2021 will have served in any capacity with any of the current U.S. House members in the Legislature. Meaning, there won’t be as many legislative friends U.S. reps will be able to call on for some aid in Lansing.

As to where a seat may be lost, well, for nearly 40 years that has always come from the Detroit area. Will it still?

Here is a thought. Rep. Justin Amash (R-Cascade Township) has proven relatively popular with his district, he has been a major thorn to President Donald Trump and he is disliked by the business community and what has been labeled the Republican establishment. If the state is forced to mix districts up is it too far-fetched to suggest Mr. Amash might have to go up against someone like Mr. Upton or U.S. Rep. Bill Huizenga (R-Zeeland)? Especially if the district would favor Mr. Upton or Mr. Huizenga more?

We’re just playing a game, after all. Ponder the possibilities.

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Income Tax ‘Fix’ Addresses Unexpected Political Mess

By Zachary Gorchow
Editor
Posted: January, 9 2018 3:33 PM

Governor Rick Snyder has come up with his answer to the federal tax law causing the elimination of the personal exemption for those paying state income tax, a technical change that will enable taxpayers to still claim an exemption for themselves and their dependents.

Michigan law now allows a $4,000 exemption, with the amount rising annually by inflation, rounded to the nearest $100, in effect saving taxpayers $170 each for themselves and their dependents. But the Michigan Income Tax Act says Michigan taxpayers can claim the same number of personal exemptions as they claim on their federal taxes. The end of the federal personal income tax exemption thus also means the end of the Michigan one.

It would mean a $1.4 billion tax increase, or again, $170 more for each taxpayer and dependent.

Well, no one thinks that’s a good idea, and so discussions began on how to remedy the issue.

The Snyder administration’s answer is a technical wording change, which is not yet available in bill form, which would in effect decouple the Michigan personal income tax exemption from the federal one. As an added bonus, the personal exemption would rise to $4,500 by 2021. Had it been up to inflation alone, the exemption probably would have needed more time to get to that level.

So everyone gets to keep their $170 per taxpayer and dependent. All’s well that ends well, right?

Well, while the legislation is simple, the process of getting it to the governor’s desk looms as a big political headache.

First of all, the probability of a legislator offering an amendment seeking a much more substantial increase in the personal exemption seems like at least 100 percent.

The House could avoid an uncomfortable record roll call vote, which became a thing of the past on amendments in that chamber once the majority decided it was tired of the minority party putting its vulnerable members in a tough spot. Now it just gavels down amendments on a voice vote. But the Senate does allow record roll call votes on amendments, and that could make for some interesting theater on the south side of the Capitol.

Republicans love tax cuts, and if there’s one tax cut Democrats prefer, it’s the personal exemption, because increasing it means the same amount of money for every taxpayer, unlike a reduction in the income tax rate.

The advantage of a “simple” fix, as the Snyder administration has called it, is that it requires amending only one section of the Income Tax Act. That’s important because it means any amendments can only affect that section of the act, thus confining the potential for mischief other changes to the bill. A bill that amends more than one section enables legislators to propose amending any portion of the act, and that would turn into a free-for-all.

Democrats could propose increasing the Corporate Income Tax, the tax Mr. Snyder championed to replace the Michigan Business Tax. The CIT, in effect since 2012, raises a small fraction of the revenues the MBT did. While businesses have applauded the new tax as far more reasonable in size and easier to administer than the complicated MBT, it is a pariah among Democrats because most of the revenue loss was made up by wiping out individual income tax credits.

Republicans could take another run at cutting the income tax rate from 4.25 percent to 3.9 percent although the House fell short of the votes necessary to make that change 11 months ago.

There have been proposals to restore some of those lost income tax credits from the 2011 tax changes. Someone could take a swing at reviving one of those.

Oh, and here’s the one that would be the most interesting: the pension tax. The 2011 tax changes extended the income tax to pension income from public sector jobs for the first time and greatly expanded the tax’s application to pension income from private sector jobs, though those born before 1946 were exempted.

In the years since then, when our reporters at Gongwer News Service have interviewed candidates for the House about the pension tax, virtually every one of them, Republican and Democrat, has said they support repealing it. If the House were to vote on pension tax repeal today, it would probably pass unanimously.

If you combine the seven Republican senators who voted against the bill in 2011 who are still in the Senate with all 11 Democrats and the Republican senators eligible for re-election in 2018, that makes well more than the 20 needed to pass something in the Senate. The only reason the pension tax made it through the Legislature in 2011 is it was combined in the same bill with the MBT repeal and Republicans could not afford to embarrass their new governor in his first year in office.

Will legislative Republicans be willing to introduce a simple single-section bill like Mr. Snyder wants and limit the drama (though there would still be plenty of it)? Or will they decide to go for more and open the proverbial political floodgates?

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