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Five Stories that Matter in Michigan This Week – December 16, 2022

  1. Cabinet Changes Announced for Governor Whitmer’s Second-Term

Last week, Governor Whitmer announced changes in leadership for several state departments. Some of the changes include Dan Eichinger taking over as acting director of the Department of Environmental, Great Lakes and Energy, Shannon Lott will become the acting director of the Department of Natural Resources, Michelle Lange chosen as the acting director of the Department of Technology, Management and Budget, and Brian Hanna will become director of the Cannabis Regulatory Agency.

Why it Matters: Further changes may be in the future as the new directors in their respective departments take over and implement their policies. Fraser Trebilcock attorneys will monitor and report on any important situations.


  1. Michigan Slips Slightly in Economic Benchmarking Report

Michigan dropped two spots, to 31st nationally, in the Business Leaders for Michigan’s annual benchmarking report that ranks states’ economic performance. While Michigan improved over last year in some key metrics, other states did as well, leading to Michigan falling slightly in the rankings.

Why it Matters: As the national economy softens, it’s more important than ever for Michigan business and government leaders to focus on sound economic policy to help maintain—and improve—the state’s competitiveness. The report highlighted, for example, how Ohio jumped from 33rd in the rankings last year to 23rd this year.


  1. Tax Changes Incoming for Research & Experimental Expenditures

For tax years beginning in 2022, research and experimental (R&E) expenditures are no longer immediately expensed but rather must be amortized over five years (15 years for foreign expenditures). This change to the tax treatment of R&E expenditures was included as a revenue raiser for the federal government to help pay for other tax breaks in the Tax Cuts and Jobs Act passed at the end of 2017.

Why it Matters: Guidance is needed immediately for the 2022 tax year, especially for corporations that must prepare financial statements. The post-2021 tax treatment of R&E expenditures is inconsistent with financial accounting principles that requires most research and development costs to be expensed immediately. Learn more on the subject.


  1. Parties Ask Court to Decide on Paid Sick Leave / Minimum Wage Increase by February 1

Earlier this week, a 3-judge appellate panel heard arguments from both parties on whether to overturn the July 2022 ruling to adopt and amend two 2018 ballot initiatives that would increase the minimum wage to $12 per hour, increased tipped wages, and would significantly alter paid sick leave laws in the state forcing businesses to have to change their policies.

Why it Matters: Both parties have requested a decision by February 1 from the Court of Appeals, as the July 2022 ruling had a stay enforced until February 19. Depending on the court’s decision, businesses in the state may have to alter their paid sick leave policies and increase their minimum wage and tipped wage levels. We will continue to monitor the situation and report on any new developments.


  1. CRA Publishes New Monthly Data, Average Price Lowest Ever Been

According to recent monthly data published by the Cannabis Regulatory Agency, the average retail flower price of an ounce of cannabis is $95.12, an all-time low and a 50% decrease compared to last year.

Why it Matters: While the prices of cannabis and cannabis-related products continue to decrease and make consumers happy, growers on the other hand are seeing profits decrease resulting in them seeking ways to halt new licenses to be granted in an effort to steady prices. Contact our cannabis law attorneys if you have any questions.

Related Practice Groups and Professionals

Election Law | Garett Koger
Business & Tax  | Paul McCord
Labor, Employment & Civil Rights | Aaron Davis
Cannabis Law | Sean Gallagher