Top Michigan DEQ Budget Priority Could Be Challenge

LANSING – Environmental Quality Director Heidi Grether told both subcommittees overseeing her budget that finding a replacement for the Clean Michigan Initiative bonds was her top priority for the year, and heard concerns from members of both panels over the proposed increase in tipping fees.

As part of the department’s $494.59 million budget ($46.95 million General Fund), Governor Rick Snyder proposed a new $78.96 million Renew Michigan’s Environment program to replace the CMI funds.

Grether said the new program, still called the Clean Michigan Program in the budget, funds essentially the same tasks as the bonds had, but with some shift in priority.

“The Clean Michigan Initiative funds helped address thousands of contaminated sites,” she said. “While the bonds did many great things, the bond was expensive.”

The $675 million total for the CMI will cost the state more than $1 billion once it is paid off in 2040, she said. Nearly all of the revenue from the bonds is either spent or committed, she said.

The new program would be funded through an increase to the state’s tipping fee on solid waste to $4.75 a ton from the current 36 cents. Ms. Grether said the proposal would ensure a steady revenue source for cleanup of orphaned environmental sites, which would get $45 million of the total.

Other programs under the new fund are recycling grants ($15 million), solid waste management ($6 million), state park infrastructure and water quality monitoring ($5 million each) and asbestos and landfill gas monitoring and materials management ($1.5 million each).

Amy Epkey, DEQ deputy director, noted that, based on current volumes, $16.5 million of the new fee would be paid by Canadian communities and $3.5 million by other states. She said about a quarter of the new fee would be paid by households.

Rep. Mary Whiteford (R-Casco Township), chair of the House Appropriations Environmental Quality Subcommittee, noting the 3,400 sites that had seen some funding under the Clean Michigan Initiative, questioned how many of those had been closed and ready for redevelopment.

Grether said some had, but some had only recently seen funds approved and still had work remaining.

“Very clearly, our goal is to get these sites closed and off the list,” she said, though adding that some have recently come back on the list of eligible sites because of vapor intrusion from old contaminants thought contained or from new contaminants found.

Sen. Mike Green (R-Mayville), chair of the Senate Appropriations Environmental Quality Subcommittee, asked if Ms. Grether had an alternative plan.

“This is a bad year to ask for big fees,” Green said. “It’s an election year for everybody. I can see a big problem getting this done.”

Green said he might be able to get the plan through the Senate but questioned its viability in the House.

“Ever thought about what $50 million General Fund would do?” he said.

Grether acknowledged she did not have an alternative plan, but said she was open to others’ proposals.

Though he did not indicate opposition to funding the cleanups, Green did question whether some might have been completed without state assistance. “We’ll probably never know if somebody would go ahead and do it themselves because they want the property,” he said.

Epkey said in most cases, without the state funding, it would be more cost effective to use a greenfield site than a brownfield.

Sen. Hoon-Yung Hopgood (D-Taylor) agreed on the concerns of passing a fee increase during an election year, and asked what the department was doing to prevent additions to the cleanup list.

Grether said that is the goal of the department’s regulatory functions. “Are we managing what people are doing for the future?” she said, though adding she did not expect to ever completely end additions to the list between spills and new chemicals being found hazardous.

Rep. Jon Hoadley (D-Kalamazoo) praised the plan. “Those who use more will pay more. That’s a really conservative idea,” he said, adding that the current plan dissociated the benefits of industry and the related costs of contamination.

The department is asking to maintain the $4 million General Fund in the Oil and Gas Program. Epkey said that represents a portion of the severance tax oil drilling companies pay into the General Fund.

There was also some discussion at the subcommittees about the proposed new water infrastructure fund, which would be the subject of a different fee increase, but budget officials noted the new program was not part of the 2018-19 budget.

Hoadley said he supported the idea of the fee, but wanted to be sure that it was capped at $5 per person as the proposal stated.

This story was published by Gongwer News Service.