Michigan Developments
Eric Rule,
Director of Governmental Affairs

Business-competitiveness panel seeks ideas
A bipartisan, bicameral committee working on recommendations for maintaining and attracting business investment and good-paying jobs wants to hear from members of the Michigan Retailers Association. Sen. Alan Sanborn (R-Richmond), committee co-chair, has contacted MRA and asked if any members are interested in providing testimony during a series of hearings across the state.

MRA will testify and make the case that item-pricing reforms and ratification of the national streamlined sales tax project are necessary for improving business competitiveness in Michigan. Any members interested in sharing problems or potential solutions with the committee are invited to do so, and should contact MRA’s Governmental Affairs staff at 800.366.3699.

The committee’s report is scheduled to be delivered to the Senate Majority Leader and Speaker of the House in September. The hearing dates and locations are:
March 31 - Grand Rapids
April 15 - Traverse City
April 16 - Menominee
April 28 - Macomb County
May 5 - Battle Creek
May 19 - Bay City/Saginaw area
June 9 - Monroe

$3-a-ton solid-waste surcharge proposed
A bill has been introduced in the House to add a $3 surcharge to each ton of solid waste removed to a landfill. Bill sponsor Rep. Jerry Kooiman (R-Grand Rapids) says the legislation is intended to encourage greater recycling of sold waste.

Although the bill would appear to impact only the waste-management industry, retailers—especially larger operations with distribution centers—could see their waste removal bills increase. The waste-management industry likely would not absorb the increased charge and would pass it on to the businesses and residences they service.

MRA is part of a broad-based coalition that includes the waste-management industry and is opposed to the bill. The Speaker of the House has indicated he is opposed to the bill, but anything can happen during budget negotiations.

Electronic recycling talks involve MRA
In the past few years, the issue of recycling electronic waste has been discussed and enacted in various states throughout the nation. The Michigan Department of Environmental Quality recently decided to consider this practice in Michigan.

Such programs can be very burdensome to the retailer, with some plans requiring the retailer of electronic materials such as televisions and computers to charge the consumer a fee or deposit when purchasing these products. They may also require the retailer to “take back” electronic materials for recycling.

MRA will be participating in the initial discussions that begin on March 27 in Lansing. The major stakeholders will be present to offer insight on how the state can encourage the recycling of these products without causing too many burdens on the various industries involved in their sale and manufacture.

More information on possible approaches that the state will take will be forthcoming from MRA as the discussions proceed. Comments from members are welcomed by MRA.

Land-use bills introduced in Senate
Senate Republicans rolled out an eight-bill package intended to protect farmland from development, create incentives for land donations and urge Congress to pass federal legislation cutting the tax on lands sold to conservation entities.

Sponsor Patty Birkholz (R-Saugatuck), chair of the Senate Natural Resources and Environmental Affairs Committee, introduced the legislation despite Gov. Granholm’s desire for lawmakers to hold off on legislation dealing with land use until her recently established blue-ribbon commission completes its recommendations next fall.

Frank appointed chair of Tax Commission
Granholm appointed former State Rep. A.T. Frank, a Saginaw Democrat, as chair of the State Tax Commission. Rep. Frank, who could not seek re-election last November because of term limits, is a former staff member of the Michigan Retailers Association.

Update from Washington
James Goldberg,
MRA Washington Counsel

FTC mandates national ÒDo Not CallÓ list
The Federal Trade Commission has amended its 10-year-old telemarketing-
sales rule to establish a national “do not call” list that all telemarketers would have to check prior to making unsolicited calls to individuals. If a business made a call to anyone whose name was on the list, it could be subject to an FTC enforcement action or possible civil litigation.

However, the final rule contains an exemption sought by MRA and other retailer organizations. It is not a violation of the rule for a retailer to call an individual with whom the retailer has had a business relationship within the preceding 18 months. In other words, a retailer may call a customer and try to sell that customer an extended service contract on a previously purchased appliance, if the purchase or last payment occurred within 18 months of the call.

The new rule only applies to calls to consumers in which the telemarketer is trying to sell something. It does not apply when a retailer calls a customer and states, for example, that the business is having a sale starting on a specific date.

For all covered calls, a telemarketer would have to first determine whether a customer’s name exists on the national “do not call” list; names will be provided by the FTC, for a fee to be determined. If the individual hasn’t indicated that he or she wants calls blocked, the telemarketer must identify himself on the call, state that the purpose of the call is to sell goods or services and provide an identification of the type of goods or services being offered.

The rule also applies to “upselling,” where a customer calls a retailer to find out information, and the retailer responds by trying to sell the customer a specific product or service.

The rule also sets forth guidelines for what’s called “free-to-pay” services in which an individual receives a product or service at no cost for an initial period and will be obligated to pay for it later if he or she does not take action to cancel the offer before the end of the trial period.

In addition, the rule requires telemarketers to transmit caller ID data about the phone number they are calling from.

Hearing held on product-registration cards
The Consumer Product Safety Commission (CPSC) recently held a hearing on a petition filed by the Consumer Federation of America (CFA) requesting that the agency require product-registration cards for all products intended for use by children.

The CFA proposed that recall of dangerous products would be more effective if manufacturers, retailers, private labelers and importers were responsible for collecting and maintaining the information for 20 years after the product’s first sale.

However, it appeared at the hearing that CPSC staff agreed with comments filed by the National Retail Federation and others that the legislative history of the federal law establishing the Commission expressly excluded retailers from such reporting requirements.

The agency will decide shortly whether to reject the petition or to seek public comments.

Major retailers begin collecting online sales tax
A group of 10 major retailers, including Wal-Mart, Marshall Field’s, Target, Toys R Us and Mervyn’s, has begun collecting state sales taxes on all transactions occurring on their Internet sides, after reaching agreement with nearly 40 states that were pressing the companies to collect.

States agreed to forego any attempt to collect back taxes in return for the retailers agreeing to begin collecting the taxes now.

The companies apparently wanted to simplify the operations of the “bricks and mortar” and Internet sites to permit customers to return products purchased online to any store. States had argued that such a move gave the retailers “nexus” and thus obligated them to collect sales taxes.

The move is expected to give a boost to efforts by MRA and other retail groups to secure passage of federal legislation to require virtually all Internet and remote sellers to collect state sales taxes.

At the present time, legislatures in Michigan and several other states are moving forward with the adoption of legislation to implement the so-called Streamlined Sales Tax Project (SSTP), which is designed to simplify state sales tax laws and make them more uniform across the country. Adoption of the SSTP will be the quid pro quo for states being able to require sales tax collection on Internet sales.