LANSING – If the Michigan Legislature in 2007 cannot resolve the business replacement tax issue in a way that would not hurt state revenues, then Gov. Jennifer Granholm told reporters Monday she would consider a ballot proposal on a business tax.

The idea is very preliminary and would depend largely on the makeup of the Legislature, and, of course, on her re-election on November 7. But Granholm told reporters riding with her at the start of her statewide bus tour that going to the voters with a plan for a business tax replacement is an option.

If a ballot proposal does go before the voters it would likely include elements of the Single Business Tax plan Granholm proposed in 2005 that would expand the base and flatten the tax rate.

Genna Gent, director of communications for the campaign, said there is no definite plan to seek a ballot proposal, only that it remained a possibility if there is no satisfactory resolution of the business tax issue with the Legislature.

A spokesperson for Granholm’s Republican opponent, Dick DeVos, said the statement was essentially an acknowledgement that she would be unable to finish the job.

The SBT is now scheduled to end on December 31, 2007. A special joint committee of the Legislature is scheduled to propose an alternative to the tax by December 1, though most officials now believe it nearly impossible that the Legislature and the governor would resolve the business tax issue during the lame-duck session.

Ari Adler, a spokesperson for Senate Majority Leader Ken Sikkema (R-Wyoming), said it was hard to respond to an idea that was “half-baked.”

Should Granholm win re-election and should the Legislature go Democratic, there seemed to be a sense on the bus that a resolution to the tax issue could be reached.

If the Legislature remains in Republican hands, the possibility of a ballot proposal seemed greater.

Gent said the discussion was not intended to suggest that the Legislature had to work on the proposal Ms. Granholm brought forth in 2005, although Ms. Granholm has called for whatever tax is enacted to replace the revenues the SBT would generate.

Plus, Gent said the Legislature never took a formal vote on Granholm’s proposal. Technically, it still could before the current Legislature adjourns sine die.

But a ballot proposal in 2007 could be technically problematic as there are no statewide elections scheduled that year. Many cities will hold municipal elections, but not all. Then there would be the question if a tax approved in November would provide officials in the Department of Treasury with enough time to put together the documents and forms businesses would need to use to pay the tax.

John Truscott, spokesperson for DeVos, said the GOP candidate is not thinking about such a possibility because he will be able to complete work on a proposal. Even if the Legislature went Democratic, he said, DeVos would be able to reach a resolution.

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