In this issue:
- What could a road funding plan look like?
- UIA obligation assessment phased out early
- FDA bans fruit and mint flavored cartridge-based e-cigs effective Feb. 6
- Tobacco 21 guidance from the FDA
- House Judiciary considers ban on vaping products containing Vitamin E Acetate
- Regulatory round-up
What could a road funding plan look like?
As the legislature resumes its normal business after the holiday break, we’re back in budget season and expecting conversations to focus around a potential road funding plan. Once could argue budget season and road discussions never left, but with elections looming in November any chance for a real plan must be presented soon. Here’s what we’re hearing as potential ideas so far: allowing local governments to add local taxes on fuel, issuing state bonds, toll roads, or raising the sales tax. So essentially, it’s all back on the table.
While MRA agrees good roads are critical to retailers – both in transporting goods to stores and customers traveling to stores – our position has always been to support reasonable increases in user-based fees that ensure those using the roads share the burden of fixing them. Expect to hear lots more on this topic in the governor’s Jan. 29 State of the State Address. So far, the governor has indicated that it may need to be a combination of revenue sources to reach $2.5 billion in additional funding.
UIA obligation assessment phased out early
Thanks to the early payoff of Michigan Finance Authority bonds by the Unemployment
Insurance Agency (UIA), employers will no longer see the added obligation assessment calculated in their unemployment tax rate. According to UIA, the early payoff of bonds used to cover the increase in unemployment claims from the 2008-2010 recession will allow employers to keep $55 million in added taxes. Employers will see a reduction of $65 to $217 per employee in 2020. To calculate the estimated savings for your business, visit the estimated savings table on the UIA website.
FDA bans fruit and mint flavored cartridge-based e-cigs effective Feb. 6
On Jan. 7, the FDA filed a policy with the federal register prioritizing enforcement against certain unauthorized flavored e-cigarette products including fruit and mint flavors. Enforcement will begin Feb. 6, 2020. Retailers are still permitted to sell tobacco and menthol flavored e-cigarette products.
Tobacco 21 guidance from the FDA
Earlier today the FDA released a statement providing more clarity on recent federal law change raising the purchase age from 18 to 21 for tobacco and vaping products. MRA and our federal partners have been waiting on guidance on what retailers can expect in terms of enforcement. During this period of transition, FDA states that the agency expects retailers to follow the law and take measures to ensure an individual purchasing a tobacco product is 21 or older, including manually checking IDs when needed. However, during this ramp-up period, FDA will continue to only use minors under the age of 18 in its compliance check program.
In the notice, the FDA also noted it has free resources available to assist retailers in calculating the age of customers. Retailers who use FDA’s This is Our Watch digital age verification calendar may update the minimum purchase age on the calendar to 21 years. Instructions on how to update the age on the digital calendar are available on FDA’s website. Retailers who would like a This is Our Watch digital age verification calendar may order one free of charge from FDA’s Center for Tobacco Products Exchange Lab. Additionally, retailers who use FDA’s Age Calculator app should update the age limit to 21 years through the app settings. Instructions are provided within the help feature of the app.
Now that federal guidance is available, we expect the state will soon offer additional clarity on what it will be doing as of enforcement and how it will be handling the discrepancies between state and federal law.
House Judiciary considers ban on vaping products containing Vitamin E Acetate
Yesterday, the House Judiciary Committee heard testimony on HB 5159-5161, which seek to ban
vitamin E acetate, from being added to marijuana and tobacco vaping products. Vitamin E Acetate, which helps to liquify the solution used in vaping devices is thought to be the cause of vaping illnesses and deaths across the country, from marijuana and tobacco vaping products. In testimony before the committee, the Marijuana Regulatory Agency’s executive director suggested the legislation be broadened to prohibit any additive in vaping products not approved by the U.S. Food and Drug Administration. The committee is supportive of the legislation and is considering the request to expand its scope. Next step: House Judiciary Committee vote. MRA Position: Neutral.
- Reminder: Wage statements due by Jan. 31. These include W-2, W-2G, 1099-R and 1099-MISC and must be sent to the Michigan Department of Treasury. Statements can be uploaded electronically to www.michigan.gov/mtobusiness.
- Reminder: Sales, Use and Withholding Taxes Annual Return (Form 5081) is due on Feb. 28.
- Michigan’s Department of Treasury published a notice on our marketplace facilitator law change. We’ve been told an updated RAB (revenue administrative bulletin) is in the works. Of note: “Upon request, the Department will waive failure to file or deficiency penalties for tax due on sales facilitated by a marketplace facilitator for returns due on or before April 20, 2020. Penalties will not be waived for direct sales made by facilitators during this timeframe.”
- $1.5M Recycling Quality Improvement Grant Opportunity – Together with the national nonprofit The Recycling Partnership, the Michigan Department of Environment, Great Lakes, and Energy (EGLE) is offering a new 2020 grant opportunity totaling $1.5 million to communities seeking to improve material quality in residential curbside and drop-off recycling programs. The grant request for proposals (RFP) was released on Monday, Jan. 6. Applications are due Friday, Feb. 28, 2020.
- City of Detroit receives $1M grant to expand recycling efforts. The collaboration between Detroit, EGLE and The Recycling Partnership, with special support from the PepsiCo Foundation, will increase residential access to recycling and collection capacity in Detroit through the purchase of 16,400 curbside recycling carts and nearly 4,000 multifamily containers. Grant funds also will provide additional collection capacity through commercial, public space and municipal recycling containers of various sizes and a collection vehicle.
- The Michigan Department of Health and Human Services (MDHHS) announced the allocation of a $17.5 million grant from the State Opioid Response (SOR) from the U.S. Department of Health & Human Services to respond to the opioid epidemic.
- Michigan Medicaid bulletin MSA 19-37 discusses Provider enrollment requirements for Durable Medical Equipment, Prosthetics, Orthotics, and Supplies Providers, and was issued on January 2, 2020.