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Nessel oil and gas lawsuit ‘grave abuse of power,’ business leaders say

Michigan Chamber of Commerce warns lawsuit will interrupt population, job goals

Attorney General Dana Nessel’s planned lawsuit targeting oil and gas companies would set a “highly dangerous precedent,” the Michigan Chamber of Commerce announced recently.

Nessel has been seeking legal arguments from attorneys experienced in pursuing constitutional, statutory, tort and other applicable common law claims. Specifically, she aims to have these private-practice lawyers serve as special assistant attorneys general in litigation against companies that allegedly contribute to climate change.

Nessel’s request for proposals expires today, but the Chamber of Commerce, which represents businesses in all 83 counties, in May called the attorney general’s move “a capricious attack on the business community.” The plan, it said, would create powerful state-backed incentives for private law firms to seek settlements from Michigan companies.

“It runs directly counter to the goals of growing our state population, economy and manufacturing and energy sectors,” Mike Alaimo, the chamber’s director of environmental and energy affairs, told Michigan Capitol Confidential in an email.

The chamber said the intended legal argument is unclear, as are the potential defendants in the lawsuit.

“It seems like a grave abuse of the power and authority of the Department of Attorney General,” Alaimo wrote. “Using a contingency-fee solicitation to private law firms who are highly incentivized to potentially benefit from such a lawsuit creates significant concern that a state office could go this route on any number of issues without a clear rationale for doing so.”

Nessel claims climate change decreases tourism, harms agriculture and depletes Michigan’s tax base.

“Our ‘Pure Michigan’ identity is under threat from the effects of climate change,” Nessel said in a news release. “Warmer temperatures are shrinking ski seasons in the UP and disrupting the wonderful blooms of Holland’s Tulip Time Festival. Severe weather events are on the rise. These impacts threaten not only our way of life but also our economy and pose long-term risks to Michigan’s thriving agribusiness. The fossil fuel industry, despite knowing about these consequences, prioritized profits over people and the environment. Pursuing this litigation will allow us to recoup our costs and hold those responsible for jeopardizing Michigan’s economic future and way of life accountable.”

Nessel’s office said proposals will be accepted through a blind-bid process, seeking contracts with the best qualifications, experience, abilities, capacity and cost-effectiveness.

Sen. Joseph Bellino, R-Monroe, and the entire Republican Senate caucus sent a letter to Nessel, opposing the planned lawsuit.

“This frivolous and dangerous lawsuit idea is a waste of taxpayer dollars, an abuse of power and an illustration of the attorney general’s complete lack of understanding of her role in state government,” Bellino said in a separate statement.

The lawsuit follows Gov. Gretchen Whitmer and Nessel’s ongoing attempt to shutter the Line 5 pipeline, an effort they have been pursuing since 2019 — in the face of opposition from both the Biden administration and the Canadian government. The legal limbo created by the governor’s effort jeopardizes longstanding plans to upgrade the pipeline’s safety by burying it beneath the lakebed. Line 5 has carried about 540,000 gallons of hydrocarbons daily across the lakebed of Lake Michigan since 1953.

Democratic Party leaders say they fear a spill similar to the 2010 oil spill near the Kalamazoo River.

Bellino’s statement pointed to the value of oil and gas. “We use these resources to get our kids to school; transport goods to stores; heat our homes; grow, preserve and cook our food; provide health care; and supply the electricity needed to power our economy and electric vehicles — not to mention that our state’s largest industry and largest job providers literally would not exist without them,” Bellino wrote.

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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Michigan Supreme Court rejects request to overrule canvassers’ action on $15 wage proposal

Court declines to override decision

An effort to place an initiative on the November 2024 ballot asking whether to raise the hourly minimum wage to $15 has failed. The Michigan Supreme Court rejected a request to override the decision made by the Board of State Canvassers that will keep the question off the ballot.

The group Raise the Wage Michigan asked the state’s top court to overrule the Board of State Canvasser’s refusal to certify its petition to boost the minimum wage to $15 per hour by 2027. The petition, if the board had approved it, would have advanced to the November 2024 ballot.

The current minimum hourly wage is $10.33.

The board approved the petition language, first brought forth by Raise the Wage, to lower the threshold for making an employer subject to the minimum wage. The threshold would go from two employees to one. Raise the Wage, however, changed the wording when it then circulated petitions. The petitions said the law would apply to employers with 21 or fewer workers.

The court said this change could have eliminated the minimum wage for employers with fewer than 21 workers instead of raising the minimum wage for all employees.

The canvasser’s board deadlocked 2-2 and rejected the revised petition submitted for its final approval.

Justice Brian Zahra wrote a concurring opinion.

“It was abundantly reasonable for the Board to conclude that plaintiff failed to obtain preapproval of an accurate statement of the petition submitted for final approval, which, rather than increasing the minimum wage for all employees, may have served to eliminate it for thousands,” Zahra wrote.

The ruling cited polling from the Michigan Restaurant and Lodging Association that 61% of Michigan restaurant operators said they would lay off more than 25% of their tipped employees if the minimum-wage offset is substantially reduced or eliminated.

Zahra said the decision was best made by lawmakers and the democratic processes.

“As repeatedly indicated in similar cases, it is not the role of this Court to second guess and question the administration of election disputes properly left to the bipartisan oversight of the Board of State Canvassers,” Zahra wrote.

Justin Winslow, president and CEO of the trade group MRLA, welcomed the ruling.

"We are relieved that the Michigan Supreme Court agreed with Michigan Opportunity that the drafting errors in Raise the Wage's submission were so significant as to render it fatally flawed,” Winslow said in a statement. “While the restaurant and broader hospitality industry still operate in the long shadow of the pending Adopt-and-Amend ruling by the Michigan Supreme Court expected later this year, this ruling will provide some solace to the nearly 500,000 industry employees and nearly 20,000 operators that they can return their focus to serving up Pure Michigan hospitality to millions of Michiganders every day."

Michael LaFaive, senior director of the Morey Fiscal Policy Initiative at the Mackinac Center for Public Policy, said the ruling is “a win for Michigan.”

“It means greater opportunity for job seekers and for those who work under the tipped minimum wage,” LaFaive told CapCon. “Mandated minimum wages throttle opportunities for lower-income workers that can have long-term pay consequences. In addition, research and experience have shown that the net pay of tipped workers may decline. It’s not hard to see why. Restaurant goers presume their servers enjoy a much higher wage and are less likely to offer generous tips.”

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.