Updates About Legislation

This week, members of the Senate Appropriations Committee reported on SB 596 (Anthony, D-Lansing) and HB 4420 (Kunse, R-Clare), legislation that would apply transparency measures for budget earmarks into state statute. In a unanimous vote, HB 4420 which outlines the requirements for the earmark request form, was approved by members. All but one legislator voted for SB 596, which would enact certain transparency requirements for legislative earmarks.

Both bills were substituted before being reported, with the S-1 substitute for SB 596 including several changes. The bill defines a “legislatively directed spending item” (LDSI) as an appropriation that provides a specific amount of money to a particular entity, local government, or project. It excludes funds tied to declared emergencies, formula-based programs, or services that are already required by law.

Earmarks would need to be reviewed by the originating chamber’s appropriations committee before inclusion in any bill or conference report. For-profit organizations would be ineligible for earmarks, while nonprofits must have operated in Michigan for at least three years, maintained a Michigan office for one year, and have a board of directors. The House and Senate would also be required to post earmark requests online within five business days of submission.

A second substitute was adopted for SB 596 to require that an earmark be submitted at least 10 days prior to being voted on by the legislature. The substitute also included parameters for giving either chamber the authority to require an earlier deadline for submitting earmarks. While the bill passed in the Senate 31-5, Speaker of the House Matt Hall (R-Richland Township) criticized the brief 10-day deadline for submitting earmarks and instead suggested a 90 day deadline would be optimal.

HB 4420’s S-2 substitute would require the legislator making the earmark request, and any cosponsors, to attach their name to the earmark. The name of the recipient and their address would also have to be included. A confirmation for nonprofit requirements detailed in SB 596’s S-1 would also be required. Each request would also need to include a statement confirming no conflict of interest and verification of the recipient’s nonprofit status or a statement that it is not-for-profit.

SB 596 is currently awaiting a committee hearing in the House Appropriations committee. HB 4420 has been placed on third reading in the Senate.

On July 4, 2025, the One Big Beautiful Bill Act of 2025 (OBBBA) was signed into law. As a result, Michigan is facing significant and concerning updates to its Medicaid and SNAP programs that will have wide-reaching effects on residents’ health and access to essential services. These changes are expected to reduce coverage and support for many vulnerable populations.

The Supplemental Nutrition Assistance Program (SNAP) supports over 1.7 million Michigan households, helping prevent food insecurity. Key changes include:

• Low-Income Home Energy Assistance Program (LIHEAP) deduction may reduce SNAP benefits
• Internet Expense Deduction removed
• Work Requirements: Waiver for Able-Bodied Adults Without Dependents (ABAWDs) is being rolled back, requiring more individuals to work or face SNAP loss
• Changes to Immigrant Eligibility: Certain refugees and asylees previously considered eligible may have benefits reduced or terminated
• Enrollment Frequency: Enrollment for SNAP may now occur every six months, instead of annually
• Error Rate-Based Funding Cuts: States will be required to pay a portion of SNAP benefits based on their Payment Error Rate (PER), effective FY28
• Administrative Cost Shift: Federal funding for SNAP administration will decrease from 50% to 25% starting FY27, requiring Michigan to cover 75% of administrative costs

Medicaid currently provides coverage for roughly one in four Michiganders and is a critical lifeline for low-income residents. Major updates include:

• New work requirements for Healthy Michigan Plan (HMP):
  • Applies to enrollees ages 19-64
  • Must work, train, or volunteer at least 80 hours per month to maintain coverage
  • Many exemptions and exceptions
  • Effective January 1, 2027
• Six-month redeterminations instead of renewing eligibility annually
• Retroactive eligibility Limits (previously 90 days prior to application):
  • HMP: Coverage now only 30 days prior to application
  • Other Medicaid programs: Coverage now only 60 days prior to application
  • Effective January 1, 2027
• Fewer coverage pathways for non-citizens
  • Some lawfully present non-citizens may receive Emergency Services Only (ESO) coverage
  • Lawful permanent residents remain eligible
  • No longer eligible: Refugees, asylum grantees, trafficking victims, and more
  • Effective October 1, 2026
• Financing and Provider Changes:
  • Insurance Provider Assessment (IPA) tax to be discontinued
  • Gradual reduction of provider tax cap
  • State Directed Payments (SDP) to providers now capped at Medicare rates (replacing prior commercial-rate cap)

For a full review of the projected impacts of these changes on Michigan residents, see this Medicaid and SNAP Impact presentation by MDHHS shared during a Senate Appropriations committee hearing.

The first half of 2025 has produced the lowest number of public acts during an active legislative session in Michigan history. Only six public acts have been signed into law, far below the nearly 200-bill average typically passed by mid-July. The only instances with fewer laws enacted were years when the Legislature didn’t convene at all. Prior to 1951, the Legislature typically met every two years, but even in years with brief special sessions, more was accomplished. For instance, during the Spanish-American War in 1898, lawmakers passed eight public acts in just 22 days. This sluggish pace has been attributed to the partisan standoff between the Republican-led House and Democrat-controlled Senate, with observers on both sides pointing to a breakdown in bipartisan cooperation and growing political polarization.