Michigan bill that would ban community benefits is effectively dead — for now

A state bill that would ban municipalities in Michigan from requiring developers to provide community benefits for projects funded by public money wasn't voted on this week — effectively killing it, for now.

The bill, which has been widely considered as an effort to prevent Detroit City Council from passing an ordinance that would require developers to negotiate Community Benefits Agreements (CBAs). CBAs are legally binding agreements that ensure specific benefits to a community — these often include jobs, housing, and other economic opportunity. 

On Tuesday, the state House Committee on Michigan's Competitiveness passed the bill, HB5977, in a tight 8-7 vote. But, as the Detroit Free Press reports, "if the bills were going to comply with the rules of the House and Senate, which require a five-day layover before one chamber can consider bills passed by the other chamber, [the bill] had to pass by Thursday." It wasn't. 

Still, lawmakers remained concerned that the language of HB 5977 could be attached to a so-called "vehicle bill" that lawmakers could consider next week. 

"It's certainly a positive development that those bills didn't move today," House Minority Leader Tim Greimel, D-Auburn Hills, told the Free Press. "But we're still trying to determine if there are vehicle bills out there that could be used to move those or other very bad public policies."

Currently, how the CBA ordinance would work in Detroit is like this: A developer who wants a public subsidy, say a tax credit or to purchase Detroit-owned property, would need to include benefits to the community. They would negotiate those benefits into a CBA, and the community is involved. If the development is 100 percent privately-funded, then they don't need to negotiate community benefits. They also don't need to involve the community if the value of the credit or property is less than $300,000.

But the new bill would prevent Detroit from enacting the CBA ordinance. Detroit City Council has been working on the ordinance for nearly two years.