Snyder asks business world for a $6 billion favor

LANSING — With Gov. Rick Snyder entering his final 18 months as Michigan’s CEO, who will be left to champion $6 billion in recommended investments to the state’s infrastructure and public schools after he leaves office?

Hint: Look to the C-suite.

Snyder and a coalition of business and academic leaders want to draft corporate executives, civic leaders and chambers of commerce to carry the flag for dozens of recommendations they say would help improve school performance, make water and roads safer, and help workers better compete in a global economy.

Enlisting the business community is gaining steam partly because corporate executives will remain in power even as lawmakers exit, many due to term limits. Michigan voters will elect a governor and all 148 legislative seats in 2018, many of which will be filled by newcomers to Lansing.

Snyder, too, is ineligible to run again after serving two terms as governor.

The corporate call to action is intended to avoid the likelihood that high-profile, Snyder-commissioned reports will wind up on a shelf as Michigan’s next governor sets his or her own priorities.

“As you have a dialogue or discussion about what you’re doing in your organization, reference these reports,” Snyder implored a business audience recently at the Detroit Regional Chamber’s annual policy conference on Mackinac Island.

“How are you embracing it?” Snyder asked the crowd. “...Are we moving the needle in some of these areas, or not?”

Snyder last year created three commissions with ambitious agendas: to improve the economy, reverse Michigan’s steep decline in education, and restore water, road and other infrastructure. The commissions were thick with executives of large Michigan companies, including Ford Motor Co., Huntington National Bank, DTE Energy Co., Whirlpool Corp., and West Michigan-based Talent 2025.

One group looked at infrastructure, from roads to water to high-speed internet access. Another researched how to restructure K-12 education to improve student performance and prepare kids for careers. The third, led by Sandy Baruah, president and CEO of the Detroit Regional Chamber, identified what a successful economy would need, including skilled talent and a favorable business climate.

“(We’ve) got to get our partners in the business community to rally behind this,” said Thomas Haas, president of Grand Valley State University, who led the education commission. “Case in point: You hear time and again, it’s all about talent. It’s about competitive advantage as a state and a region, and we aren’t there, whether it be postsecondary degree attainment or the achievement of third-grade reading.”

Though Snyder and business leaders are largely aligned, advancing these big-ticket items has eluded them ‒ largely because of a growing split between business interests and a small government, fiscally conservative Republican majority in the Legislature, whose top priority right now is closing teachers’ pensions.

Two Snyder-and-business-backed proposals would add up to $6 billion more to state spending annually ‒ roughly $4 billion just to maintain the state’s existing infrastructure systems, and another $2 billion to transform public schools.

With the list of people seeking to succeed Snyder growing, it remains unclear whether Michigan’s next governor will carry the torch on either issue.

Business leaders who spent hundreds of hours over several months researching reforms to infrastructure and education say the groups took pains to remain apolitical and nonpartisan in their recommendations.

“These are not open to political debate,” Baruah, who led the economic commission, said of the effort. He bluntly suggested to lawmakers at the Mackinac Conference that Lansing needs to be equally focused on these same issues.

“Is the piece of legislation in front of you today advancing the necessary things to achieve either the infrastructure report requirements, the education report requirements or the economic commission report requirements?” Baruah asked at the conference. “If it’s not, then the Legislature needs to ask themselves the question: Why are we spending time on this?

“If the governor who follows Rick Snyder, and the legislators starting today, ask themselves that question,” Baruah said, “we will succeed.”

The dustbin of history

The question of collecting dust often comes up when state government publishes a new report. They make an initial splash, but skeptics wonder whether they will accomplish what they set out to do.

In December 2004, the “Cherry Commission,” led by then-Lt. Gov. John Cherry, was asked by Democratic Gov. Jennifer Granholm for recommendations that would, among other things, double the percentage of Michiganders who have postsecondary degrees or other credentials over a decade.

Its success was mixed.

After the report was released, the state created the Michigan Merit Curriculum and high school graduation requirements. There was a merit-based college scholarship program, the collection of more educational performance data, and new programs for students to earn early college credits, said John Austin, director of the Michigan Economic Center and a former Democratic State Board of Education president.

But the commission’s goal of boosting degree attainment fell short. In 2005, 32.7 percent of Michigan residents 25 or older had an associate’s degree or higher, according to American Community Survey data reviewed by Bridge. By 2015, that percentage was up to 37 percent ‒ an improvement, but of just 13 percent.

Austin helped lead a December 2015 report called “Reaching for Opportunity,” which he said sought to update the Cherry Commission findings. Recommendations were similar — more residents with postsecondary degrees or credentials, making it easier for students to transfer from community colleges to universities, and expanding need-based financial aid programs.

Some higher ed experts who worked on the 2015 study told Bridge last year they were frustrated by the lack of state funding that has been budgeted to date toward the goals.

Austin said he believes the Snyder administration has made talent and education a focus of its remaining time, and a workgroup led by the Lansing-based Michigan College Access Network continues to work on solutions.

The Legislature, however, “is not serious about investing in infrastructure or about making changes to our funding model or other things that are good recommendations,” he said.

Several business and academic leaders who worked on the policy goals said they need to wind up as issues in the next campaign.

“I know that not one party has all the good ideas,” Gretchen Whitmer, a former Democratic state Senate majority leader from East Lansing who is running for governor. “I’m very interested in seeing if there are things in there that we would want to carry over.”

A short timer

In the short term, Snyder said he could use his remaining time in office to push forward on a goal to increase broadband Internet access, particularly in northern, rural areas of Michigan.

At the Grand Hotel during the Mackinac conference, he gestured toward the Straits of Mackinac and said the state’s Great Lakes shorelines would be attractive places to live and work — if only high-speed Internet were reliable.

People gravitate to large cities for economic opportunities, he said, but the ability to work remotely creates new opportunities for people who want to live in less-populated places.

“Let’s try to be more proactive about making it happen faster and better,” Snyder said. “If there’s multiple innovations or pilots we can try, let’s get them out there.”

The infrastructure report is unlike any that has preceded it, said S. Evan Weiner, the commission’s chairman and chief operating officer and executive vice president of Detroit-based Edw. C. Levy Co., a construction materials conglomerate that specializes in steel mill services and road construction,

Future governors and policymakers will have to confront the facts about the state’s deteriorating roads and water systems, Weiner said.

Already, the report led Snyder this spring to launch a pilot effort in metro Detroit and West Michigan intended to help guide the creation of a database that will serve as an infrastructure inventory, including locations and conditions.

The two regions cover about 55 percent of the state’s population. The results are due within a year, before Snyder leaves office.

In the meantime, state lawmakers have been less than friendly to any proposals that call for more revenue. For two years, legislators have cut Snyder’s plans for a statewide infrastructure fund. The 2018 budget has not yet been adopted, but proposed legislative funding levels are far below Snyder’s $20 million pitch.

Business leaders need to step up to teach local and state leaders, including newly elected legislators, the importance of the issues, Weiner said.

“The economy, education or infrastructure — those are three things that government leaders have to deal with,” he said. “If the business community could take care of it by themselves, they would have. They can’t.”