Town Hall with Governor Rick Snyder - January 22, 2013

Music… Good Evening and welcome to a special online live online town hall event with Governor Rick Snyder. Tonight we're broadcasting live from the office of the Governor in the George Romney building in Lansing, Michigan but we're not going to just take questions from our live audience here today. Many you already know the Governor's Snyder has a passion for technology. Well thanks to google plus hangouts technology we're joined tonight by participants in Traverse City, at Northwestern Michigan College, in Houghton at the Mtech Smart Zone, where I'm told the winds chill is far below zero, and in Saginaw at Saginaw Valley State University. We're gonna take questions from all of our sites tonight, but first i'm going to turn it over to the Governor of the state of Michigan for opening remarks. Ladies and gentlemen, Governor Rick Snyder. Hi...Well this is great. This is a record crowd. Well thanks for turning out such cold night, and for those in Houghton, it's just wonderful that you're still going strong. That's hearty Yoopers there. I appreciate that because it's exciting. So i appreciate you taking the time. What i try to do in these town halls are a couple things. One is giving an update on what's going on with state government how we're doing it at least from my perspective. The second thing is, and the part I really enjoy is, the question part because from the questions I can really learn about things that are on your mind and hopefully have a chance to answer those questions in a way that really you can appreciate and understand in get better insight on why we're doing certain things, because there's a lot going on and it's very exciting. One thing I'll do is is I'll try to be shorter than I was last week, for any of those that made it through the State of the State, that was a whole hour um... in terms of talking, but I really want to take a lot of questions, so I'll be fairly short term to some comments to set the stage particularly given the State of the State last week, but then have a chance that have a dialogue. And one thing, if you wonder why do we sort of have people read the questions and stuff like that: One thing we found is I can do a lot more questions that way in terms of people going through that process, because believe it or not we found when I did it the old way, where we give people a microphone, that occasionally they would make a fairly long statement before we get to the point of getting a question. So, so what I found is we're able to do almost twice as many questions, which I think really is of interest to a lot of people. So with that let me get started. First of all the State of the State is good. We're the comeback state in the United States and we should be proud of that and we should be telling people across the country that, because too often we we sort of beat up on ourselves. I said if you go back two or three years when I was campaigning is I'd find people coming in at Michigan really excited about coming to Michigan until they talk to some Michiganders and they heard our own perceptions on things. Well, we've come back a long way but we're not there yet where I want us to be, but the progress is very positive. If you look at it unemployment's improved a lot, still too high, but we were at 14 percent at one point. It's slightly below nine percent. We need to keep going on that. Personal income's improved in our state. We used to have among the highest in the nation if you go back a decade or so. We dropped to about fortieth or so in the country. Now we've started moving back up. Homes are being sold again. Home sales are up about 10 percent, prices up about five percent. And one exciting fact I shared at State of the State that isn't even on our dashboard but I think is very good is as we're the only state that lost population between 2000 and 2010. The only state that went backwards in terms of population. We actually have started growing again. It's only about 6,000 people, but it is positive progress. And so what I'd say to you is we've made tremendous progress but we shouldn't be complacent nor content with where we're at. With a long way to go, but it's an exciting upward path, and that's what we need to stay focused on. And there's two or three key messages that I really always come back to: Jobs and kids. Because if you think about it, if people have a job there's opportunities for all of us. And then keeping our young people here. And it's great to see some young people joining us today. It's exciting. It gets me fired up, because I've got three kids and I want to see us have a bright future for our children and their children. So on the jobs front, how are we doing? Well, our economy is making a good, great comeback and our major industries are all working well. Autos, agriculture, tourism, pretty much across the board. Any industries are coming back. Even the construction industry starting to see some progress now. That was probably the hardest hit of any industry, and it's starting to see some positive movement. It's still got a long way to get back to where it was, but we're headed in the right direction. So if you look at it, that's a good signal. And at the state government level, you might ask, what's our role? Well, our role isn't to create the jobs. It's to create an environment where jobs can flourish. Because think about this: If everyone worked for the state of Michigan, we would be really scared, if we had 10 million people working for the state. We got a great people working for the state, but we all shouldn't work for the state. Again, that's free-enterprise working. So our role is to create the best environment for success. And how do you do that? It's the tax system, the regulatory system, finding talent, really getting a connection between people looking for job and employers needing good help. And we've come a long way in all those. And the tax system: We've fundamentally revised our tax system so we're among the most competitive in the country. And we had a broken tax system. The Michigan Business Tax was the dumbest tax in the United States. It was fundamentally unfair, and we got rid of it. We did Personal Property Tax reform this year. That will make a huge difference for many of our communities, in terms of making that them more competitive, in terms of being able to keep jobs and grow jobs. Regulatory reform: When I talk about regulatory reform, I talk about a lot of rules we got rid of, but the point is, you don't get rid of them if they really have value, because there is an important regulatory aspect to what we do. And people will tell you that. People in the agricultural industry will actually say 'We want to be regulated, in a smart way though.' So, overall we've gotten rid of about 1,000 rules in the last couple years in our state. We've gotten rid of about ten rules for every rule we added, which really makes us much more competitive and creates a better environment. That's a good thing. The other one is how we apply the rules, though. And that gets to a big point of what I believe is the role of state government. We're not here just to take people's money and give money to somebody else, and that's the old model of how too often how political organizations work and governments work. I define state governments our role as a customer service organization, and you're the customer. Ten million customers, and the organizations in our state are customers. And how do we give you great service? So it's not just the in number of rules, but when we work with people, are we actually trying to solve your problem and help you win, and make sure you're complying with what the rules are in a proper sense? And for the really bad people, go after the really bad people. But understand most people are good people, and just trying to get by and make a living. So that's the the regulatory front. A big one I want to work on that we've started working on this, is one of the biggest opportunities and know it will come up in the questions is about matching the supply and demand of talent. Really helping people find careers. And one thing that really showed that, because I want to illustrate it to most people becuase you hear about this and it's like, 'Well, I'm not sure what exactly the governor's saying when he's talking about that.' I'll give you the illustration. We launched a website called mitalent.org about a year ago, and this was a point where we had over 9 percent unemployment in our state. Well, they went out and aggregated all the open jobs we could find across Michigan. At that point in time, we had about 80,000 open jobs. Think about that: 9 percent unemployment, 80,000 open jobs. If we filled all those jobs, that would drop our unemployment rate by about 2 percentage points, just doing that. And these weren't bad jobs, these were good jobs, skilled trade jobs. One of the jobs on the list, I'm an old accountant. We need more accountants. So we sort of built the society, a system that didn't do a great job of saying, 'Hey, here are the opportunities, they're in these fields.' And where do you go get training, if you're interested that as your first career or you're looking for that second career? So we really launched that to start it, but one of things you're going to hear about this year is that's going to be a huge emphasis, about doing a better job of matching supply and demand, and getting our educational institutions to better listen to our private-sector employers. To say how do we match those things out and get that information out to parents and kids? It's really important. So one other thing I'll mention and then I'll stop. It was one of the highlights, or one of the lowlights depending on what you think of my State of the State address, is the whole topic of investing in our roads. I'd be interested, anyone in here like the current roads in Michigan? Anybody in those remote sites, put your hand up if you really like the roads in Michigan. Okay, I don't see a whole lot of hands going up. The funny part is is, I can tell you, I've done over 100 town halls all across Michigan over the last couple years. I haven't had anybody put their hand up yet. It's one of those things we talk about and then we don't do anything. The last time we made any major change in our road funding was in '97. That was a long time ago. And so our roads are on a path right now to just continue to crumble. And it's going to get really bad if we don't invest something. So that's why I made a big deal. Because I know it's hard asking people for more dollars, but the way I view it is this is actually a chance to save money. Again, I'm a very frugal guy. I'd normally say I'm a cheap guy, but they like it better when I say frugal. Because you have to understand, you're talking about precious resources and still tight budgets for many people. Because the real question there is if we invest $1 billion a year over the next 10 years, it will avoid us getting a bill that would be $25 billion. That's a big deal. And that's a bill that we'd have to pay, the $25 billion, because if you think our roads - we're about 70 percent good and fair on one benchmark already - those roads would be in the 30s. So the other part is, that's the first tier is, you can pay now. It's much like getting an oil change versus paying for an engine rebuild, is the way I like to analogize it. You can pay something every period, keep your oil changed, or you can have this huge engine rebuild cost. Second thing is we pay too much in repairing your vehicle every year for road damage. We actually looked at this in four surrounding states versus Michigan, and we average over $80 higher then the four surrounding states. That could offset about two-thirds of the cost of what we need in additional road investment every year. Again, we may not get that full $80 back, but if you we even get a good chunk of that, that makes a huge difference in that net cost. Now the third thing is, is we calculated this would create about 12,000 jobs a year. And if we have 12,000 more jobs that's 12,000 more families being successful, and that's a whole lot more spending in the economy that can help a lot of people out there in terms of the businesses you work for. And the final one that you can't put a price tag on, and this is a lot more important than any commercial you'll ever see about being priceless, is we looked at it, if we had better roads they'd be safer roads and we'd probably save about nearly 100 people a year that otherwise will lose their lives in traffic accidents. And that's 100 people a year. And I think most of us know someone that has lost a life in a traffic accident. So if you add those all up the way I view this is, this is this is pretty straight forward to do. Now we can talk about the dollar amount, the timing, the transition, but the concept of doing it or not doing it is pretty straightforward. And that's the point I tried to make in the State of the State. If you treat this like we're a big family of 10 million people and we just sat at a dining room table and I walked through all those facts, you'd go, we'd figure out how to do this in our budget. We'd make this work. Now the problem is, if you get a bunch politicians together, they'll find a lot of reasons not to do something. And I'm not being critical of our current Legislature, I'm just giving you the history. Because again, it goes back to '97. Nothing's happened since And that's why. So part of this is deciding what's our political culture. Is it one that uses common sense and get things done or is it about politics? The good part is we've got a lot of great legislators. Some are joining us tonight in these various remote sites, and they're good people, and we're all working *** doing this together. So the good part is I think you've got a good crew, but you need to speak up on this topic and I'm sure I'll get some people speaking up tonight on one side or the other. So with that, let me stop and really open up for questions, because hopefully we can have a good dialogue. So Bill, who's gonna kick it off? Thanks governor, and our first question's going to come from the live audience here, from Kelly, who asks, "I see you're making environmental quality of our Great Lakes a priority. Please elaborate on plans to keep Asian carp out of our lakes." Kelly, can you just raise your hand? Oh, Kelly's right here! Well, I appreciate that question, Kelly, because we do need to do more. The Asian carp are a major threat to the Great Lakes, and the part is, is they're not the only aquatic invasive. I don't think most of you know, I think the number's about 170 different aquatic invasives. A hundred and seventy different threats, and that number is going up all the time. So it's one of those things we do need to get on top of and to be open with you, I wish we would've spent more emphasis over the last two or three years, but it's been difficult. So what I would say is we've dealt with a lot issues in the state, the tax system, the regulatory system, and we're still working on them to improve them. But now I felt it was time to spend time on the Great Lakes, so one thing that the opportunity came up is recently I became, just before the end of the year, I became co-chair of the Great Lakes Governors' Council with Governor Quinn from Illinois. And I think it's time to make a big deal of the Great Lakes, so over the course of the next year, we hope to make a major emphasis on the Great Lakes in terms of aquatic invasives, in terms of other water quality issues, water use issues. There's going to be a major issue that you're going to see coming up more more often about the need to dredge our harbors because of lake levels. So there's a whole litany of Great Lakes issues that I thought the best answer is, and I've invited all the governors, I talked to Gov. Quinn, is hopefully up on Mackinac Island in June we're going to have a conference, a meeting of the Great Lakes governors and hopefully the premiers from Quebec and Ontario, to really highlight these issues to make a bigger deal about it, to say now let's start taking action because there hasn't been enough to deal with these kind of topics. So I think that's a very good opportunity to really move forward in that way. Just going back to the aquatic invasives for a minute, or invasives in a minute, because I like to use this to really put it in perspective, that there's a lot of work that needs to be done and two or three topics. The first one is educating people about invasives. The next one is how do you sort of prevent the whole question in terms of keeping them out to begin with and Asian carp that we're on the edge of having, going past that line, and then if you have them actually show up, how do you kind of manage, or you know contain the problem. And then how do you deal with it in terms of long-term things if you get beyond that stage. So you gotta go through each one. So one, some of the young people here may not know this so I'm sort of speaking to the old people like me, older people, is of not understanding you're being educated. How many people remember back when you were in high school and you'd go buy a bouquet or you'd get a bouquet, depending on whatever side to the arrangement that you were on, and it would involve not just flowers, but if you want to a florist or you'd get the bouquet, it would have something called baby's breath. How many people are familiar with baby's breath? Now Roger, I bet you knew about baby's breath. I don't see your hand going up there. A lot of us put our hand up. Did you, do you realize that's an invasive? And literally there are people that spend thousands of hours every summer on the Lake Michigan dunes ripping out baby's breath? So that's one of those cases where there's a lot of work to be done to help us on all these issues. So both the aquatic and the non-aquatic. Thanks, thanks governor. Our first, our next question comes from Saginaw where Sen. Kahn is hosting, and he's standing by with a question. Sen. Kahn. Good evening governor. Governor, I'm here with Rep. Ben Glardon and Rep. Tim Kelly, they both say hello to you. Our question comes from Jaquanda Hamilton. She's concerned about the crime that we have here in mid-Michigan and in particular in Flint and Saginaw and wants to know what needs to be done to decrease crime throughout mid-Michigan and throughout Michigan. as a whole. Yeah, I appreciate that Roger. It's great to have Tim and Ben with you. I can see you guys well. You got a great location at Saginaw Valley. I did a town hall up there pretty recently, so that was fun. We do have too much crime and in particular there are four communities I highlight because it's really bad and at least for places in Michigan we have four of the top 10 most violent places in the country: Flint, Pontiac, Saginaw and Detroit. So I did a public safety message last year to really say let's focus in on these communities. To also let you know, though, we shouldn't stop there and we shouldn't look down upon those communities. It's an issue we need to deal with all over. we actually have eight of the top 100 in our state. So we're putting a focused approach on those four communities and unfortunately it doesn't turn overnight, but I think we are making progress in Saginaw and some of the other communities. And two or three steps we took. One of the first things I did is we're actually increasing the number of Michigan State troopers we have. That's something we let decline a lot over the last decade. We actually have two more classes graduating, we had a class graduate before the end of the year, we have another one going through right now, the academy. Because the nice part about Michigan State troopers, one, I just think they're the best, wonderful people, but by being Michigan State Police, we can be flexible to deploy them in whatever part of Michigan we need them. So that's part of it, and we've actually put more people, troopers up in Saginaw. The next stage is to get people cooperating better, to get the sheriff working better with the local police, with the state police, and then bringing in the prosecutors and the courts and working through that whole system together. And one of things we're trying to emphasize is, and we've started a fund this better, and you're going to hear about that when I do the budget message, is we're actually increasing the number of drug courts we have, mental health courts and veterans' courts. Because in many cases, the people may have a substance abuse issue our mental health issue, and easy answer is not just simply locking them up in the penitentiary, it's to get them treated in some fashion and hopefully get them on a more positive path for society. Dealing with them appropriately, but getting a better outcome there. And we need to work through that. And then we have the whole question about the corrections system doing a better job of financing parolees, when people re-enter, you know, when they reenter society, are they going to be successful or they just going to commit crimes again and come back in the system? We've had a pretty good program called Prisoner Reentry in Michigan. We're improving that quite a bit. They had room for improvement. One of the final things I'll always tell you, though, one of the best ways to deal with crime is to help people find a job. That gets back to the jobs point. The best crime prevention you can have in my view is if someone has a job and family, they're not going to be out committing crime. So we created a program, two programs, this last year. One's called community ventures, and we're piloting it in these four communities, and the goal is to help the structurally unemployed, the people that have seriously been challenged about finding a job for a very long time, and to really look at what are those barriers and what we can do to help them. We're starting that with 1,000 people and 1,000 jobs. And we're already showing pretty good progress. We're already probably the hundreds of placing people, and we're going to keep going to get that to really work well. The other thing was we did a summer youth initiative because in many ways if we can help young people understand what careers, give them broader exposure we have a chance to get them to avoid what could be a criminal outcome and get them in an employment outcome. And we did over 750 kids in these four communities again through the DNR, working with community groups, nonprofits in those communities to really help them be successful. And we have the resources to continue both those programs over this next year, along with more troopers, more tying into the criminal justice system. So we're just going to keep working *** this issue, not only for Saginaw in particular, but for a number of other committees in our state. And then take those learnings and spread them across all of Michigan. Governor, our next question comes from Facebook, where Brian wrote and would like to know when we plan to put the shovels in the ground on the new bridge. The sooner the better. Yeah, the bridge is a great opportunity because it literally will create 10,000 construction jobs for a number of years. More importantly, it will create tens of thousands of long-term jobs for Michigan. And I won't go through all the bridge stuff, people are probably still tired of bridge comments, but to put in perspective for you, to give you some idea: The Ambassador Bridge, in terms of how much volume they have, let me compare it to what happens at Niagra in the Buffalo area of New York. They have four bridges there - four - and they're all financially viable. If you come and look at the Ambassador Bridge, it has more traffic then all four of those bridges combined. And so the point is, shouldn't we at least have a second crossing that will lead to more trade and more jobs? In terms of the specific question, in terms of the timing, the timing is basically, the next step that we're waiting for in the process is a presidential permit, which actually comes from the Secretary of State. Eventually the president's responsible for it, but is gets processed by the Department of State. And we're actually on a reasonable path to get that permit, and as soon as we get that permit, we should be in a position to really move forward and get to the point of starting to acquire land, the engineering work being done to move forward on the bridge. So that's pretty exciting. Governor, the next question comes up from Traverse City on the campus of Northwestern Michigan College, where Sen. Howard Walker is the host. Sen. Walker, question for the governor? Good evening, governor. Hi Howard. How are you? I'm fine, and I just want to let you know that it was probably a lot easier for you to get into northern michigan via the internet that by driving, so thank you. A little snowstorm. But I do have a question from Don Coal and its regarding our regulatory reforms in the areas of wineries, microbreweries and the new distilleries. Someone's thirsty! Well, thirsty and also northern Michigan has found a, or they have found a home for these in this area, and there's a lot of interest in developing some of these facilities because it's a good match with our tourism industry. And Don is wondering with the recommendations from the Regulatory Reform Committee, I guess, have you developed any position or a strategy to work through or following through on some of the recommendations and the reforms or what can we look forward to with regards to reforms so these industries can develop even further. That's a great question, Howard, and Don's been working hard in that field for a long time. If you look at it, that's something that we simply ran out of time at the end of the year to keep pushing forward. As I mentioned, we got rid of 1,000 net rules, we had regulatory reform efforts in a number of areas. Occupations for one, workplace safety, finance and insurance. This area was one of those, but it was one of those fourth or fifth kind of efforts. And as you recall from the legislative side, Don, we actually had a number of bills that went through the legislature and thank you for your support on regulatory reform at the end of the year. And we simply ran out of time to look at which ones in that particular report we should be pushing forward with. So that's something we do have on our agenda, to go through that report, identify the most prudent ones of those to move forward with and so, we should be working together on that with the new session getting started. Next question right back here in Lansing, governor, from Elijah, there. He asks, "Governor, foreign investment versus local investment - do you have a preference in terms of the continued economic recovery recovery of Michigan." Absolutely. The easiest answer is you always go to local investment first. You always want to help the people already here. Most jobs are going to come from people already in Michigan, and those are the ones that are already our customer. So you should always focus and that ahead of going after investment anywhere else. And the illustration I'll give you, that's a different philosophy then you hear from a lot of government people. And it just shows a lack of understanding of what I describe as good business. You'll hear a lot of people say that they were out hunting mode, that they didn't pay as much attention to what was in their state, and they were out trying to bring new things into the state all the time. For the business people in the audience, let me ask you this. If your business is challenged, if you're having a difficult time in your business, do you take care of your current customers first, or do you go after new customers? I can hear the business people sort of laugh. Because that's almost business 101, is if you have a challenged business, you always take care of your current customers first. It's much easier to retain a customer, work with them than ever trying to go get a new customer come in. And that's the same philosophy here. The term that you'll hear quite often, sometimes in the press and we're trying to get it to come up more often is so-called economic gardening. So it's like you garden in your own backyard to grow jobs before you go off hunting. Now what I'll tell you is is we're doing some hunting, because you shouldn't just be exclusive one or the other, it's really what percentage and how you balance those two things. So the bulk of our resources and effort are on economic gardening and they're going to stay there. But we're doing well enough now in terms of creating an environment for success where we're doing some hunting. So for example, I did trade missions to, I've been to China, Japan, Korea, Germany, Italy and Canada. And we're going to continue to do some of that over the next year. So most likely this year I'm looking to a trip to Israel because of they're very high-tech, and I think there's good opportunity to bring businesses to Michigan from that. And then most likely I'll be back in China sometime in the fall. So it's that balancing act but the balance is clearly weighted towards economic gardening, helping Michigan businesses right here. And that's the same thing. One thing I will mention is, I blew up most of the tax credits for business, because that was part of hunting is we're giving huge tax credits out to people to come into our state, where we weren't doing things for people already in our state. I didn't think that was fair. So to give you some idea of magnitude, the amount of tax credits we're paying for this year are out of this year's budget that were given out years ago, so this is how much we start our balance, our budget with in the hole before we even start saying we need to balance that, $500 million. And so my view is, shouldn't we be treating people evenly, creating a level playing field? So I got rid of almost all that. We kept some strategic dollars to give out some cash, but it's only a fraction of what those tax credits amount to. So we've restructured a much fairer system that I think is much smarter for us for the long term. Governor, the next question comes to us from frigid Houghton, where Dave Nyberg is hosting at the M-Tech Smart Zone in Michigan Tech's Lakeshore Center. David, you have a question for the governor? I do. Good evening, governor. This question comes from Tom Tikedon, he's a county commissioner here in Houghton County, and he's also the director of Main Street Calumet. Tom's question is, "Governor, you mentioned transportation improvements in your State of the State address. Can you share some specific ideas about how we accomplish transportation infrastructure improvements in Michigan?" Yeah, no, I appreciate that. And you guys are at a cool site. I've been to the M-Tech up there, it's very cool, so they're high-tech up there. So I don't know that they're trying to show off, but stay warm first. As a practical matter, in terms of transportation infrastructure, we do need to invest, but it's not just about, I talked about where the dollars would come from, let me talk about where the dollars would go. Because I think that's worth talking about, about how the funds would get distributed. To give you some idea, the current formula that they used to distribute our transportation dollars are under something called Act 51. And when I came to Lansing, I'm not a career politician, so I kept on hearing people talk about Act 51 this and Act 51 that, a lot of Act 51 stuff, so I finally stopped and I said, 'Isn't there like an Act 51 almost every year when they pass acts? Say of what year they're from!' So I said, 'What year is Act 51 from?' And Bill's laughing because he's the guy told me, he goes, 'Governor, it's Act 51 of 1951.' And that's the statute that decided how we distribute our road funds. Now, for those of you that haven't tracked and been around Michigan a very long time, the interstate freeway system wasn't started until after 1951. To give you some idea that things have changed slightly since 1951. Well, they have modified it over time. So I said, 'Give me a chart of Act 51, where the dollars go.' It's like a bowl of spaghetti. This thing's got lines and curves going all this different ways. It's all goofed up folks. It doesn't make any rational sense. A lot of it depending on who might have been in office at that particular time to say, 'Okay, they got something for their area verses this area.' So I said, 'Shouldn't we clean this up?' Again, we don't want to take, we don't want to cause huge issues for areas that are already getting money, but for this new investment, let's invest it based on what would be smart. To actually put it where main commercial corridors are, where the most important places are to invest and do it in a thoughtful fashion, and clean up the old Act 51 situation. So that's a big part of this reform package, too, is to use your dollars smarter, and when I say dollars I appreciate the infrastructure question because it's not just about roads. Roads are critically important, but we actually have some important rail infrastructure things we need to invest in in this state, both passenger but also freight. If you talk to the agricultural community there are some important things we can improve there. It also deals with harbors. In particular, that can be an important issue for the U.P. And the lake shore issues because, one of the issues you're gonna come up is this harbor drudging issue that's going to come up over and over because of lake levels. And so we need the dollar resources to do more with our harbors. And then finally there's the whole issue of mass transit, public transportation. We have some good systems, but one illustration was is we just got legislation passed for the Regional Transit Authority for southeastern Michigan. That was a case where we had probably the worst set-up for public transportation of any major area in the entire United States. We've avoided dealing with it appropriately for the last 40 years, and now we have a structure to help address that situation and deal with it appropriately. In terms of demand, we were top 10 in terms of demand for regional transit needs in metro Detroit. Our raking in terms of capacity, in terms of ability to serve, we're ranked below 100, and so we're getting that straightened out, and that would be part of the use of these dollars, so it would be very widespread. Now a lot areas that, if you think about it, if I go through that list, it touches almost all of us in some way in our lives, in terms of a better economic opportunity. We're going to go next back to Saginaw where Senator Kahn is live from Saginaw Valley State University, Senator Kahn? Hi. I've got a question from Emily and similarly from Samantha. They're both concerned about the affordability of college education. They remember the Promise Scholarship and how that was helpful. What are we going to be able to do in the future for the affordability of post-high school education? Yeah, there's at least three ways to work it because college is too expensive today. I mean that's a major challenge. Believe me I know, I've got three kids. I've got two in college right now. And if you stop and look at it, the three levels that need to be worked, the first level is just better cost management, in terms of the universities in the institutions involved in the process. That if you look at it, just like we've done a lot of things for best practices to say as a state how we need operate to be more efficient, the universities need to do that. And they're trying, they're working towards that, but what I'd say is that I think there's still room for improvement. So I don't want to be critical, it's more let's get on top of it and work at it. And to put it in perspective, there's a lot of limits on what we can do as state government because there's a lot of autonomy to the university system in Michigan. So I really encourage you to talk to people in the universities to really work that issue, and I think they'll respect that comment and work it. The second one is the financial aid question. Is there more we can do to help with financial aid? Because the promise concept came up. We used to have some programs, some merit scholarships. What I would tell you this is they disappeared before I got in office, largely, because of budget challenges. If we have an opportunity to look at some of that, I'm happy to look at it, but I wouldn't do it that way. And what I mean by that is a lot of it was pure merit, and to be open with the you, I always want to recognize merit. But given the cost of education, I want to look at need, and really try to give it to people that need it the most. And I speak to this from personal experience. My oldest, my son, actually got some of the award money from the old program, and we're very fortunate. I've been fortunate my career where we can afford college for our kids. So we actually made donations to universities for that dollar amount more to sort of say take the money back, would you please, and give it to people that really need it, so they can stay in school or go to school. The last one is we need to think more innovative, because the first two probably don't surprise you, but let's think out of the box. Let's be more creative here. And we passed some legislation this last year that was really cool so I want to thank, thank you to Roger and Ben and all the people working this, Howard, that were part of that and I know Tim, you're going to jump in on this one, but we did something called dual enrollment, which said if you're in high school you can also get credit in college. And part of the goal here is, can't we look at building a system longer term where you might be able to complete a whole year of college while you're still in high school? Wouldn't that be cool? Because think about that. If you completed year of college before you finish high school, how much would you save? That's one year out of four, that would be a 25 percent savings. So that'd amount to a bigger savings amount than almost anything else you could think of. And we didn't have a system to do that very well. We can improve. And to me this a very personal one because you've heard the nerd thing right? Everybody know I'm a nerd? The history of that actually goes back to the fact I started college when I was a junior in high school. And so I started going to college basically full time while I was in high school. The obnoxious part of this was I actually took government when I was in college. When I was a junior high school, I got an A. See, I was a good nerd. And then I got to my senior year in high school they didn't recognize anything I had done. They wouldn't give credit, they didn't give anything for it. So because of Michigan curriculum standards, I actually had to take government in high school in my senior year even though I had an A in government in college. That was a very worthwhile class by the way, but that just shows by being innovative thinking out of the box you can make a huge difference, so let's think that way too. Coming back to the audience right here in Lansing, Bill asks "When the Education Achievement Authority was selected to point the way to reviving failing schools, what experience, what history of success was demonstrated by the EAA to convince you that the EAA was the right organization to remedy the problems?" Bill, you here? Raise your hand. Great, well I appreciate the question Bill. Let me give you an update. There's not experience yet with the EAA in terms of a lot of results because they just started their first school year in September, looked all across the United States. We did a lot of research, and the main model we ended up using was New Orleans. Because Katrina came and literally wiped out their school system. Things were so desperate in Louisiana, they had a clean sheet of paper to say if you are designing a school system, what would it look like? To really account for what is the best state of thought for public education in the country. And they created something called the Louisiana Recovery District, and so a lot of cases, we went to Louisiana. I even spoke to the guy that had been superintendent, we spoke to people in the Louisiana government about how well worked. We talked to people of the Department of Education at the national level, Arne Duncan, the Secretary of Education, and really took that. And then we found some other pieces and we tried to put the best model together of best practice. And that became the model for the Educational Achievement Authority that we launched in Detroit with 15 schools in September. And the idea there is a couple unique things. First of all, it's for persistently failing schools, schools that have had a terrible track record. A number of these schools had zero college ready students graduate from them prior to us coming into these schools. So it's for the schools that were the most desperate in some ways. And the idea was, it's not a school district. It's a system of schools. And the idea is, you push as much resources out of the central office and as much into the classroom as possible. So the goal is to have close to 90 percent of the dollars in the classroom rather than in other functions, and build off of that. But very importantly, it did something else. They have a longer school day, they have over a 200 day school year. Because there's a lot evidence, if you look around the globe, the place's being most successful, they just have more time in school, because you can lose a lot over a summer time. And then beyond that, they actually have gone to something called student-centered learning, where really the students are sort of taking more charge of their education. Those of you that are familiar with my story at all, it's a similar kind of model, where basically the students are mastering levels of competency. So one thing that you found in persistently failing schools, a lot of kids would just flunk a grade, and they could flunk a grade more than once. There's no flunking in these schools. It's only a question of how long it takes you to master level of competency so you can move on to the next level. So you can see culturally, it sort of creates a whole different tone. So kids aren't there to flunk, they're there to succeed and master something. ways the teacher becomes much more a coach, and the model really works. It's really cool. I went and visited the schools, I've been there a couple times to visit students. I'm going to go back in the next month or so, and talk to parents and teachers and the kids. It's a great opportunity, and so we hope to help these schools and we hope to add some schools besides Detroit that are on the persistently failing list. It's never going to be a huge organization. And sometimes people think, well, it's going to take over all the schools in Michigan. That's not going to happen. That's not it's intent. It's to deal with these persistently failing schools. And what I hope happens is they can be a place of innovation that any school, it's an open model, so any school district can say, 'We want to start doing some of the same things that they're doing for kids that aren't on the persistently failing list.' And I hope schools start doing that stuff because then the EAA can go learn from them. So in a lot of ways, it's a place to really innovate in education, to really say it's about moving to the future and being creative and really focusing on student growth. So it's very exciting. The EAA is something I'm pretty passionate and fired up about. The biggest challenge is when you do something so new and novel like that, a lot of people are challenged with change. Actually I do that with a lot of things I do, and we tend to take on tough issues, and everybody likes change until it shows up right? That was a really good idea until you asked me to change something. So that's a big part of the barrier and we're just going to keep moving forward. Thanks Governor. Going back to Traverse City: Senator Walker, you have a question for the governor? Thanks again Governor, I have with me Jeff, and he's from, he's a staff person with Representative Wayne Schmidt. I'm going to turn over the opportunity to him to ask you a question. Hi Governor, thanks again for using Traverse City in this experience again. Representative Schmidt is unfortunately unable to attend tonight. He's down in Lansing working on some proposals. Two questions, trying to mash them together, one from Steve and one from James here in Traverse. Talking about transportation funding and your proposal. Mainly, how will your proposal be equitable both for businesses and individuals, and to that point, how will that help local communities such as Grand Traverse County and northern Michigan? Great, I appreciate that. Wayne's doing a great job in terms of working on stuff, so I appreciate that. I'm glad you can be be up there to share. In terms of if you look at the whole process, why is it fair? Because these are user fees largely. They're not what I would call "attacks," but really saying is based on how much you use the road, if you think about gas tax. This is to change it to a percentage, and there are some variations. When we talk about average cost, the average cost that we're calculating is about $120 per vehicle to get about $1 billion a year. That's not insignificant, but it varies dramatically based on what kind of vehicle and how much you use your vehicle. So if you don't drive much at all, you wouldn't pay much at all. If you drive all the time or that's your business, you're going pay a lot more. But you're using the roads. Isn't it fair that you pay more or less based on your use of the roads? On the registration piece, we do that based on value in Michigan. So if you have that used car, that inexpensive car because you couldn't afford a lot, your percentage increase is going to be very low. If you happen to have that big luxury vehicle you're going to pay more. So there's really, it's really based on value of the vehicle and very importantly road usage, and that seems to be pretty fair answer when you look at that model in terms of saying it's a user fee. So the more you use the more you pay. The less you use, you don't pay. If you use public transit and don't own a vehicle, you don't pay anything. In terms of the Traverse City area, one things we're focusing on, as I mentioned, is changing the funding formula, it's really to reflect where the greatest demands are, in terms of are there important roads that we need to prioritize? Again, Michigan actually does a very good job of an asset management plan. Every year, MDOT, or every couple years, they do a five-year plan to present what priorities are, and I remember Howard, if you go way back when I was campaigning, I remember coming to your campaign headquarters and we had a discussion about how there's a road or two right near where your headquarters was that was a big commercial stretch. It wasn't a long term stretch but you had a whole lot of commercial businesses, industrial businesses on this stretch of road that needed to make sure it was improved and in good shape because that was about a lot of jobs. And those are the kind of things that we really want to prioritize to say, 'Let's make sure we're being successful in terms of job creation, and then let's make sure we're taking good, better care of our roads all across the state.' One thing I will share with you too, though, I talked about $1.2 billion and I talked about $1 billion. We're actually talking about giving local counties or groups of counties the ability to do a local option. And again, that would be a vote of the people, that would be up to you in your community. But to decide you want to focus in on your own projects, your own road projects, your own mass transit projects, your own infrastructure projects. Here's an option that you can decide you want some additional adder to make an investment in the things you want to prioritize the most. That seemed pretty fair because that happens in many places across the country. Thanks Governor. Going back to Houghton now, where Dave Nyberg has the next question. Dave? Yeah. Governor, this question comes from Kim Stoker. Kim's the president of the Upper Peninsula Economic Development Alliance. He's raising his hand there. Kim is a proponent of this project called the U.P. Link Project, which is a high-definition video processing project that he's working on. He would like to know how they can partner with the state to do business smarter through the use of high-definition video conferencing. Yeah, I would be happy to learn more about that. That one I've heard of but I don't know enough about. If you look at the basics, we're actually going through several steps to make it happen. And one, this just happened over the last year or so, is we're finally getting broadband connection across the bridge. It's actually mind-boggling to me to learn that we didn't have a real broadband connection across the Mackinac Bridge to connect the two peninsulas. A lot of it is completing that circuit around the lakes, because that really opens up a lot of opportunity and that could tie right into your project. Again, that's the question of what kind of fiber is it, what's the capacity, how to manage that in an effective fashion. So I think it ties right into that, because one of the cool things you can do that I believe is probably behind some of your question, Kim, is you can do great business or great economic development work or great creative work anywhere in the country if you've got enough bandwidth to do that. And so the question is, is we've got fabulous quality of life places. We've got Traverse City, Houghton, both are now high recreation areas, that if people could say they could live there year-round because they have better connectivity, we could see growth and say, 'Hey, I want to live right there do my business. I can do business all around the globe from right here.' So that's where the high-def piece really comes in. So that's a very worthwhile thing to look at, in terms of making that connection. One of the other things that surprised me, just to give you a side note so you recognize, we have some things still to work on. Because there actually isn't a good electrical connection even between the Upper and Lower Peninsula. And I think that's something that needs to take place. So for example, the Lower Peninsula, we pretty much get all our power just coming in from the south, and the U.P.'s getting all their's pretty much from Wisconsin. And wouldn't it be bright at some point if we actually say let's complete a much more reliable circuit, beause in the northern parts of the Lower Peninsula and in the U.P. they actually occasionally brown out or other issues because of quality of power. So those are the things that you sort of always assume are just a given, but we actually haven't done well on electrical connection or broadband, which ties into your high-def question. Governor, the next question is right here from Lansing from Mike who asks, "The state of Michigan has the tenth highest most expensive auto insurance rates in the nation, but provides best benefits when a catastrophic accident happens. How would auto no-fault reform stress the already overburdened Medicaid system, or what does it make make a difference?" Mike, where are you? Mike, I appreciate your question. Actually I'll be happy to talk about Medicaid separately because there's a big question coming up there, but in terms of the no-fault reform, to give you some idea is, in terms of magnitude, we're the tenth most expensive, but the severity of our claim, the average no-fault claim in Michigan is $44,000. The next two states, number two is $17,000 and the next one after that is $10,000. And we do need be thoughtful because you're talking about injured people here. So there's two. One is there's a question, should there be a cap on medical expenses? And the way I describe it is I don't like the word cap, but there should be some kind of number that goes with the standard policy that then people can decide you want to buy more because it's no-fault. You decide whether you want to get additional coverage beyond that. So you shouldn't be limited in how much you want, but to give you, that's not the biggest concern. The biggest concern is really more on the management of medical costs for somebody that gets hurt. So that issue of limitations are one thing. And to give you some idea, a $1 million limit would be 20 times higher than the next highest state in the country. Those are huge orders of magnitude, so we're trying to be very good here. And again, I'm not even saying that, I'm just giving you an illustration of what $1 million would do. That would be 20 times the next closest state in terms of limitations. And again, you should be able to buy higher. But the bigger one is the management of the medical cost question because right now, basically people that are hurt are paying full list, which is full price, where almost no one is paying list for medical. If you have any kind of insurance or you're going in, it's a substantially discounted number. So the point is, is can't we get it to be a more discounted rate, which could drop those costs by a lot that come out of your premium. So there's room for improvement to still provide care but to do it in a much more cost effective fashion, that we should look at. And there's a whole issue of auto fraud insurance. There's a whole bunch auto insurance questions we need to work in Michigan. On your Medicaid expansion question, or Medicaid question, that piece is a fairly small element compared to the question about, we now have to address, are we going to increase Medicaid for lots of people, probably in about the range of a half million people in Michigan? And that's a big choice we need to make, and to be open with you, I'm going to make my recommendation when I do the budget on Feb. 7. So I'm not going to give you the answer tonight, but I'm going to tell you the big question. The big question on Medicaid expansion is, in my view, is not just the cost feature, but the question is do we have enough capacity to take people in and and put them in a medical home model, which is, means they have a primary care physician, they actually have a place for medical care where can be managed in some fashion to be effective and actually keep people healthier and well to begin with. Because if we can't do that, it simply leads to people going to the ER two or three more times. The costs skyrocket and it would become, it would be awful in terms of cost prohibitive for all of society. So the big question that needs to be answered in my view is how much is our capacity to have primary care people or get them into the system so we take care of them the right way? It may not be there day one, but we have a plan to do that? So that's what we analyzing right now, is our capacity and plan, talking to the health care community and other people. Thank you, governor. We've had really great participation in from all three places and we're moving now toward the end of our allotted time. I want to remind everybody that if you have a specific question hasn't been answered or you greet, or you would prefer to talk offline, you can reach Governor Snyder's office at 517-335-7858. Again, that number is 517-335-7858. We're going to take the the final question now from Saginaw, and Senator Kahn, you're live on the air, go ahead with your question. Okay. We have a question here from a Barbara who wonders where we're going with the funding, the funding formula for special education that is, is funding for special education being looked at or does it need some changes or how would we go about deciding if it does need a change? Yeah, we're looking at all parts of our education funding formula, because it's continuous improvement. How do we keep doing better? So I would say it's more than just special education, it's the whole funding model, and again, the goal is how do you work with people to optimize student growth? So we can work on the system to get the most growth, most positive growth out of each child every year. Because one of the things we have to do is, shouldn't we try to get to the point where for most kids, they can grow at least one year or more every year of school? And we're not doing that today. We've got a lot of really good people in the education system, a lot of great teachers, a lot of great people in the system, but our outcomes are not very good, for special ed and otherwise, for most kids. Only 17 percent of our kids are college ready when they come out of high school, in terms of if you look at the ACT test, saying did they do well enough on all subjects to say they are doing well to go off to college. 17 percent. That's up from 14 percent two or three years ago. And when people say, 'Well, the governor's full of it, because I don't buy that,' I always like to give you the other stat that really illustrates it, makes it tangible, is what percentage of our kids do you think have to take a remedial class before they can take an entry-level community college class, when they go off to community college? You know what the statewide percentage is that need a remedial class? It's in excess of 60 percent. So we need to do better. Special ed kids deserve special attention, obviously. A lot of it is also going to the point of what are special ed kids? And then making sure we have, to find the right way and identified the right way, and working with their families to make sure we can follow up. So we have done some cool stuff. One of things I'm proud of, one of the big accomplishments last year is we did something with autism, in terms of helping provide coverage for autism. Because that gets into a lot of educational learning issues. That what we found, and unfortunately it's hard when someone gets older, but if you can help work with someone when they're still very young, the evidence is compelling now that you can actually dramatically improve the quality of their life, their family's life and actually the cost to society. So those are the kind of things we need to be looking at all the time, so I'd give you an illustration. We are looking at special ed, but we have big issues on all kids, but then we are having, have had real success with autism, for example, in terms of at least starting a process to really help children. Thank you, governor. We've had a lot of questions tonight and I want to thank everybody for joining. Governor, I want to turn it over to you for just some closing comments at this time. Thanks, and I appreciate everyone joining. Thank you for people involved in Houghton, Traverse City and Saginaw for joining. Hopefully you found it to be an interesting experience. Those of you, those of you here in person, we got a record crowd here. What we really are trying to do is leverage technology in a way to say, 'Let's talk all across the state to do things together.' Because the biggest thing we need to do in my view is really work on our culture in Michigan. And what do I mean by that? It's harder to change a culture that to change any law or regulation. And a lot of it is just becoming more positive about who we are and recognizing we're all in this together. So I have a philosophy called Relentless Positive Action that I get up and live every day. No blame, no credit. You simply hired me to show up and use common sense to solve problems, and to be relentless in pursuing solutions, and going after one problem after another and just keep going. We actually have an expression in our office called we work in dog years. Because when I first came to office I said to we got to get at least four years worth of work done in the first six months, but I said we got more than six months worth of work to do. And so I stepped back to say okay, what's the closest thing? Four years, six months, stuff like that. Dogs! Seven to one. So we jumped on the dog year concept, and we actually live that. And I'll put Bill on the spot. I actually terrified poor Bill at the end of the year. We were working on a special message and stuff like that on energy and the environment, we were working on this, I believe that's when it came up. And we're working really *** something and I said, 'Bill, you know about dog years, right?' Bill's like, 'I got it, I'm with you on dog years.' I said, 'Bill, think greyhound.' It's about going even faster. So we're going to continue to work hard but that's why we need to have a good dialogue, and that's why I really appreciate you taking the time. Hopefully this has been worth your time and attention. I'm honored to be your governor. I'm fired up to be your governor. We've come a long way, but we're not stopping. This is not the time to be complacent nor content nor take anything for granted. Now's the time to use dog years and Relentless Positive Action to continue on a path to make sure that these last two or three years end up being several decades of positive growth for Michigan. Because it's not only us, but it's like for the young people that joined us today, say how do we create this environment so they can have a Michigan where they don't have to deal with a bunch of the stuff that we're cleaning up now, and they can think about their future, their kids' future and just look towards the future in a very positive way. That's exciting. So thank you so much for joining us. I hope you enjoyed it. Thank you. Thanks. Nice to see you. Thank you. Ladies and gentlemen, this concludes tonight's town hall event. Thank you to all for joining us. Drive safely and keep warm.