Michigan Developments
Eric Rule,
Director of Governmental Affairs

Item-pricing reform tops 2002 agenda
The Michigan House may consider legislation this year addressing one of retailers' top concerns: Michigan's onerous item-pricing requirements.

House Bill 5544, sponsored by Rep. Mike Bishop (R-Rochester), would allow retailers to use technological solutions for customer price verification instead of individually marking every piece of merchandise.

The legislation would let retailers provide portable UPC scanners capable of printing receipts for customers who want to check the price of an item. Retailers would have to demonstrate 98-percent scanner accuracy to be exempt from item pricing. The exemption would not apply to food or nonprescription drugs.

Rep. David Woodward (D-Royal Oak) has introduced a separate bill, HB 5562, that doubles fines for violation of scanner accuracy standards.

No timetable has been set for the bills. But nothing will happen before the January 23 State of the State address, the last for Gov. John Engler.

The thorniest issue facing the legislature this year is the expected $1.4 billion shortfall in the state budget for 2003, especially its impact on scheduled reductions in the personal income tax and Single Business Tax. The state's Budget Stabilization Fund is likely to be drawn below $250 million, activating an automatic suspension of the SBT rollback.

Gov. Engler has made passage of his "MI HiSpeed Internet Plan" a priority to increase broadband coverage in the state. MRA is backing this proposal, which would provide funding to help private companies expand high-speed Internet hookups in underserved areas.

House Republicans have proposed an increase in the cap on unemployment compensation benefits, which have been frozen at a maximum of $300 per week since 1995, in return for a delay in payments. MRA is participating in a coalition representing business interests on the issue.

Proposed restrictions on telemarketing remain high on MRA's list of concerns. Despite passage in the Senate of a business-friendly telemarketing package just before the holiday recess, the issue is still under close watch by MRA.

Because of major differences between the House and Senate versions of the package, the bills must go to a conference committee. The lawmakers expected to be named to the committee have not been favorable to the concerns of the business community.

MRA will remain vigilant to ensure that business protections are not stripped from the conference bill. MRA will also continue to push for an exemption for businesses that have a prior relationship with a customer.

An MRA-supported bill to outlaw shoplifting devices is expected to be taken up by the Senate this session, after passing the House. Sponsored by Rep. Bishop, HB 5125 criminalizes use of materials such as foil-lined bags and tag removers to prevent merchandise from being detected by store anti-theft devices.

Another issue expected to surface again is scrap tire regulation. Late last year MRA won amendments to HB 5380 to relieve record-keeping duties and liability retailers would have faced for scrap tire disposal.

The package that includes HB 5380 was held up over a proposed fee increase on vehicle tires. A compromise plan was passed leaving the fee unchanged but placing a three-month sunset on the provision - meaning the legislature must reconsider the proposal by this spring.

Online orders planned for liquor licensees
Legislation passed in December paves the way for the Michigan Liquor Control Commission to create an online ordering system for licensees. The new system would allow licensees to place all their liquor orders at once rather than calling three authorized distributors.

The Liquor Control Commission has also instituted a new "fast track" license approval process for liquor licensees with a clean record who are purchasing another licensed business. Fast track applications are available from the commission at 517.322.1400 or www.cis.state.mi.us/lcc.

Dunaskiss drops committee responsibilities
At his request, Sen. Mat Dunaskiss (R-Lake Orion) has been temporarily removed from his committee assignments while he recovers his health. He was hospitalized for several days after suffering an apparent grand mal seizure on the Senate floor December 12.

Dunaskiss served as chair of the Technology & Energy Committee and the Senior Citizens & Veterans Affairs Committee, was vice chair of the Human Resources & Labor Committee and the Natural Resources & Environmental Affairs Committee, and sat on the Financial Services Committee and the Michigan Capitol Committee.

Update from Washington
James Goldberg,
MRA Washington Counsel

Supreme Court limits Disabilities Act
The U.S. Supreme Court has significantly tightened the standard that employees must meet before they can claim coverage under the Americans with Disabilities Act.

In a unanimous decision, the Court held that an automobile assembly-line worker with carpal tunnel syndrome was not protected by the ADA because the repetitive-motion disorder did not prevent or severely restrict her from "doing activities that are of central importance to most people's daily lives."

The employee had developed carpal tunnel syndrome while assigned to the assembly line. Several years later, when she refused to continue in a different quality-control job offered by the company, she was fired. She sued, claiming that the company failed to make a reasonable accommodation to her condition, as required by the ADA.

But the Court disagreed, saying that the 1990 federal law clearly states that a disability is a condition that affects "major life activities," and that mere evidence of an impairment, even when accompanied by a medial diagnosis, is not sufficient to provide eligibility for ADA protection.

The decision is the latest in a series of Supreme Court opinions limiting the scope of the ADA. In 1999 the justices ruled that the law does not cover most correctable conditions, such as poor eyesight that can be improved with eyeglasses.

Price Increase planned for postage stamps
The U.S. Postal Service and major mailers have agreed on a settlement of a pending postal rate increase case that will probably result in a three-cent increase in first-class mail rates, effective on or about July 1.

Other classes of mail, including third-class mail (used primarily for advertising purposes), are expected to see similar increases.

The Postal Service is reeling from last fall's anthrax attacks and a sharp drop-off in postal volume caused by those incidents and the general slowdown of the economy.

The mailers apparently agreed to the larger-than-anticipated rate increase in return for a promise that additional increases would not be sought for some time.

Sales tax holiday still has a chance
Despite growing support, the House of Representatives failed to include a federal sales tax holiday in an economic stimulus package it passed just before the Christmas recess.

Although the issue is "limping along," in the words of one Capitol Hill observer, it isn't quite dead yet. Senate Majority Leader Tom Daschle (D-SD) held up Senate consideration of the House-passed bill because he thought the package did too much for business and too little for workers, especially those laid off in the wake of the September 11 tragedy.

Among the small-business benefits in the House-passed bill were an increase in the amount that can be expensed (instead of amortized) under the IRS Code from $24,000 to $35,000 annually, and a reduction in the cost recovery period for leasehold improvements from 39 years to 15 years.

MRA's Washington Office and its retail industry allies pushed strongly for inclusion of the sales tax holiday, under which the federal government would reimburse states for lost revenue if the states enacted a sales tax holiday for all retail products.

The original plan was to hold the holiday before Christmas, but now a mid-February to mid-March date is being discussed - if Congress continues to work on the stimulus legislation when it returns from the holiday break.

Revisions considered for overtime pay rules
In its latest semiannual regulatory listing, the Bush administration has made revising the "white-collar" exemptions from overtime pay a priority. The white-collar rules define professional, executive and administrative employees and set forth conditions under which these employees are exempt from overtime pay requirements.

The regulatory listing says a formal notice of proposed rule-making will be published in September.

Needed revisions to the white-collar exemptions have been largely ignored since President Ronald Reagan rescinded changes made by the Department of Labor in late 1980, at the end of President Jimmy Carter's term.

Business lobbyists, including MRA's Washington Office, sought changes to these rules in the mid-1990s, proposing legislation to simplify the white-collar criteria and open it up to more individuals. They only partially succeeded when Congress established a new exemption for inside salespersons. Most of those covered are employees of manufacturers and wholesalers who call on retail accounts from a central office.

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