Michigan_state_capitolIn Michigan, the ill fated revenue sharing initiative known as the Economic Vitality Incentive Program (EVIP), a “Carrot and a stick” approach to passing down state revenue sharing dollars to local units of government is dead – – or is it?

The 2015 Approved Appropriations Bill tells a little bit of a different story.

Yes – EVIP by name (the phrase and acronym) is gone!!  Hooray!

The requirement started off as a novel idea, but the execution, and eventual audit ‘nit-picking’ turned it into a downer!

Category 2 (Shared Services) and Category 3 (Compensation and Unfunded Liabilities) are COMPLETELY DEAD and nowhere to be found in the Appropriations Bill this year.

But Transparency & Accountability requirements are still intact.

These were formally known as Category 1 requirements.  Section 952 titled REVENUE SHARING, found on page 133 in the House Enrolled Bill 5313 (approved by the Senate too) subsection (3) clearly states:

“For purposes of accountability & transparency, each eligible city, village, township or county shall certify by December 1, (2014) or the first day of a payment month, that it has produced a…

Citizen’s guide of its most recent local finances, including a recognition of its unfunded liabilities, a performance dashboard, a debt service report containing a detailed listing of its debt service requirements, including at a minimum, the issuance date, issuance amount, type of debt instrument, a listing of all revenues pledged to finance debt service by debt instrument,  a listing of the annual payment amount, and a projected budget report, including at a minimum, the current Fiscal Year (budget year) and, a projection for the immediately following Fiscal Year (next budget year). The projected budget report shall include revenues, and expenditures and an explanation of the assumptions used for the projections.

The bill further states, “The citizen’s guide, performance dashboard, debt service report and projected budget report shall be made available for public viewing in the city, village, township or county’s clerks office or posted on a publicly available internet site.”

However, in Section 4(a)3 on page 134, “”a department of treasury review (audit)…is not required in order for a (local unit) to receive payment” and directs the Department of Treasury to develop detailed guidance for local units to follow to meet the requirements of this subsection – and distribute it to the local units by October 1, 2014.   Section 4f also gives fair warning to those that think they might send in the compliance paperwork, but not actually do the work!

So let’s sum it up!!

  • EVIP by name – is dead, gone, kaput!
  • More local units are eligible (by formula) for revenue sharing.
  • Compliance, formally known as Category 1 survived – and does require a compliance document be submitted…BUT there is no auditing mechanism.
  • If a local unit falsely submits compliance paperwork yet does not follow the requirements, it
    • “Shall forfeit any future revenue sharing payments

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