Local Grocery Bag Bans Coming? Not If These Legislators Prevail
At least two counties poised to regulate, but research shows negative effects
Some Michigan legislators want to protect retailers from becoming enmeshed in a web of conflicting local ordinances regulating the use of plastic bags. Senate Bill 853, sponsored by Republican state Senators James Stamas, Mike Shirkey, Ken Horn and Wayne Schmidt, would pre-empt local governments from enacting ordinances that regulate “auxiliary containers,” including bottles, bags, and disposable cups. The bill follows the lead of similar measures in other states, several of which have already become law.
While there are currently no local bag bans in Michigan, at least two counties are looking to regulate bags. Sarah Damm, a sustainability coordinator for Muskegon County, said people there are working to finalize an ordinance for the Board of Commissioners to consider within the next few months. The measure would likely ban stores from giving plastic bags to customers and impose a fee for each paper bag they distribute. Plastic bags would still be allowed at meat and produce counters.
The idea emerged last year when Muskegon Board Chairman Terry Sabo complained about expenses the county incurred in picking up plastic bags that fly away from its landfill. The bags often land in trees and on neighboring properties, according to Damm, and account for most of the $25,000 the county spends each year picking up the landfill’s litter.
Washtenaw County also has a professional in this area on its payroll. Solid Waste Program Specialist Noelle Bowman says the county is considering its own ordinance. It would not be a ban; instead, it would take a “product stewardship policy approach.” It’s doing so with the Boston-based Product Stewardship Institute, which says on its website that stewardship efforts to reduce the effects of plastic use can be voluntary or compelled by law.
The regulation of plastic bags is one of many areas where activists are looking for local governments to take on issues previously reserved to states and the federal government.
According to a module on the National League of Cities’ website, Michigan is a so-called Dillon Rule state, which refers to an 1868 doctrine promoted by Iowa Judge John Dillon that local government should operate with a narrow scope of authority. Thomas Cooley, a well-known Michigan judge of the same era, challenged this doctrine, arguing that locals have an inherent right to greater levels of self-government. But the league reports that Michigan still operates mostly under a Dillon Rule system.
Damm said Muskegon County explored these doctrines extensively with its legal counsel before concluding that it does have the power to regulate plastic bags. The county, she said, gets this through its power to manage sanitary and stormwater sewers and drains, where bags can accumulate and clog pipes.
“Solid waste is the responsibility of county government, as it sees fit,” said Damm.
The Michigan Grocers Association opposes local regulation and supports state pre-emption.
“A patchwork of local ordinances is bad for local economies, bad for businesses, and bad for consumers, who have come to rely on these convenient containers to protect and transport their purchases,” said Linda Gobler, President and CEO of the Michigan Grocers Association.
Opponents of a ban say that it will lead to confusion and higher costs for consumers with little positive effects. Paper bags cost more and are more expensive to stock and distribute than plastic ones. Grocers operate on profit margins of 1 to 2 percent, according to the U.S. Treasury Department, so any cost increase may show up in more expensive groceries.
A study commissioned by the city of Austin, Texas two years after they banned plastic bags found a reduction in the use of plastic bags but also that people were throwing away reusable bags at a much higher rate than anticipated, mitigating the positive environmental effects. Other research has found that reusable bags often contain coliform bacteria and even a spike in visits to the hospital for E. coli potentially linked to bag bans.
Opponents also point out that plastic bags are often reused by consumers, which is a positive for the environment, and they are unfairly demonized because of their visibility. Landfills accept many types of plastic refuse not singled out for new government restrictions. Additionally, consumers who currently reuse plastic grocery bags for many purposes may end up buying plastic bags made from heavier stock. Their manufacture requires use even more resources and they eventually take more landfill space.
Bag bans have already been imposed by more than 100 local governments around the country, mostly in California and New England. Moving in the opposite direction, legislatures in Texas and Florida have pre-empted local bag bans, and Arizona and Missouri are poised to do the same. Bills are pending in Indiana, Wisconsin and Idaho, and are being drafted in South Carolina and Louisiana.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.
New Bill Fixes a Pension Problem, Leaves Major Problem Untouched
Boosted pensions aren't the main cause of underfunding
Rep. Pat Somerville (R-New Boston) introduced a bill last week that would prevent local government employees from using overtime and other extra compensation to boost their taxpayer-funded pension benefits. The bill could can lower the costs of those benefits and make them more predictable, but unfortunately it will do little to contain the runaway costs of an underfunded pension system.
The problem with public pensions in Michigan is not how generous they are, but how politicians tend to kick the costs of funding them into the future.
When public employees work for one year, they earn credit towards a pension that they will collect when they retire. In order to pay for this, their employer puts money into a pension fund. This ensures that the pension credits employees earn in a year are paid for in that same year.
But to make this happen how much does the employer need to prefund the pension fund on behalf of each employee? Determining this amount requires making a number of assumptions about the future, for instance: how long a retiree will collect a pension, how large that pension will be, and — most importantly — how much will the pension funds' investments grow before money is needed to cover benefits.
The value of an individual's pension is typically determined by three things — average compensation, years of service and a multiplier applied to these. Excluding overtime and other salary boosters from the definition of compensation can help make the average amounts used in the benefits formula more predictable. There have been a number of cases in which individuals' pensions were artificially boosted (Michigan Capitol Confidential has covered several of them). The Somerville bill will make these cases rarer.
But this is not the core problem governments face with pensions. The multi-billion-dollar gaps between how much is owed to employees and how much has been set aside to pay are the real problems.
There are two fixes. The first is to lower investment return assumptions. On paper, this would appear to increase the gaps between the amount saved and the amount owed, and it would require larger contributions to prefund pension credits earned each year. But it would also help prevent this state's pension systems from becoming the kind of problem that drives governments toward insolvency.
Governments can also start getting out of the defined-benefit pension game altogether. Contributing money into a retirement fund that each employee controls would prevent governments from promising benefits that history shows they haven't been willing to pay for in advance.
The rising cost of meeting pension commitments means governments are spending more than ever paying for services that were delivered some time in the past. This is unfair to pensioners, taxpayers and current managers who have to dig deep into their budgets catch up on past pension underfunding. Tweaks to retirement rules can help, but lawmakers need to focus more on the real pension problem.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.
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