Who foots the bill if Michigan legislators waive licensing fees for restaurants?
LANSING  Legislation aimed at helping food service establishments could leave local health departments operating at a loss. The two Michigan Senate bills would waive licensing fees for one year to help food service establishments recover from financial losses suffered during the pandemic. But waiving those fees could leave local health departments hundreds of thousands of dollars in the hole because the legislation does not include a mechanism to offset the local revenue loss. The bills, introduced by Sen. Curt VanderWall, R-Ludington, passed the Senate in May by a 20-16 vote and are currently pending before the House of Representatives. Its not a bad idea at all, in concept, Ingham County Health Officer Linda Vail said. There should be a way to fill that budget hole.  If theres a way to replace those funds, I support that, she added. If the bill passes, fees will be waived for 973 establishments in Ingham County, 513 in Barry and Eaton counties and 540 within the Mid-Michigan District Health Department, which covers Clinton, Gratiot and Montcalm counties. Food service licensing is the responsibility of local health departments, which set their own fees. As a part of the process, health departments inspect establishments and review food services plans, according to the Michigan Department of Agriculture and Rural Development. The licensing fees, which are paid annually, range from $152 to $935 for ICHD, $155 to $732 for BEDHD and $201 to $604 for MMDHD. The fees vary based on the type of food service establishment. ICHD and BEDHD did not provide estimates of the financial loss if the bills pass. MMDHD estimates losing $236,551. Food service license fees support 50% to 75% of the cost of supporting food safety activities at the local level, so the bills could have a greater fiscal impact on local food safety activities than on State government, a legislative analysis of the bills said. MDARD could lose more than $5 million, according to a legislative fiscal analysis. VanderWall said, during an April committee hearing, that the bills will provide relief to the businesses that had to closed during the stay-at-home orders. He said the waived fees will not come close to making the business owners whole from the losses they suffered. It is a small gesture, VanderWall said. The food service industry was one of the hardest hit during the pandemic, especially for the states locally-owned businesses, Vail said. I dont think its completely unreasonable, she said. VanderWall said COVID-19 relief money from the American Rescue Plan Act will keep communities from taking a hit if these fees are waived. MMDHD Health Officer Marcus Cheatham said hes already spoken with county administrators about the potential need for relief funds to offset the loss as he expects the bills will move forward. I cant imagine them not passing it, Cheatham said. Like local governments, the state too is receiving substantial relief fund dollars, Vail said. The Legislature should look for some source of funding because it will create a budget hole for local health departments, she said. Consideration should be given to where the local revenue comes from if its not coming from fees, Vail said. It seems like there ought to be a way to fund that if thats what youd like to do, she said. I think there needs to be a funding mechanism for it.  The pandemic has also been hard on local health departments as staff has tried to keep up with regular duties but also responding to COVID-19, Vail said. Ingham County scaled back on many operations to meet the pandemics demands, she said. Public health needs to get back to functions outside the pandemic at this point, Vail said. We need the funding to have the staff to do those things, she said. Contact reporter Craig Lyons at 517-377-1047 or calyons@lsj.com. Follow him on Twitter @craigalyons.