Emerging Statewide Campaign Issue: Stopping State Spending Spree Building New Facilities Obligating Grassroot Taxpayers to Repay Bond Loans Without Constitutionally Required Voter Approval Or Competitive Bids.

LANSING, Mich. -- Taxpayers United is trying to stop Gov. Engler's method of sneaking new facilities for state employees into construction without constitutionally required public scrutiny.

Despite objections expressed by thousands of grassroot taxpayers to all candidates for Governor, Lt. Gov., Attorney General, Secretary of State and 16 State Senators and State Representatives (and their opponents) currently on the Joint State-House Capital Outlay Committee, Gov. Engler has notified legislative leaders he still wants "approval" to begin construction without competitive bidding of a $300 million new high rise headquarters building for the State Police and National Guard on a flood plain near the Capitol before he leaves office December 31 this year.

Without disclosure required by Michigan's Open Meetings Act, Gov. Engler wants to increase taxes $300 million and obligate future grassroot taxpayers to pay back the borrowed money in the form of bonds he wants to issue.

Dick Headlee has written politicians of his concern that "certain elected officials are actively seeking to circumvent the Constitutional protections of the 1978 Headlee Tax Limitation Amendment by financially obligating future State Government Administrations and citizens of Michigan with sizeable implied full-faith bonded indebtedness without public debate, without competitive bidding, and without a vote of the people".

"Both Republicans and Democrats are engaging in creative financing similar to Enron and CMS Energy Corp.(largest state-regulated utility) by trying to keep honest accounting of such illegal taxing and spending off the books and not annually reported in Total State Revenues", noted Bill McMaster, state chairman of Taxpayers United. An overlooked part of Detroit Mayor Kwame Kilpatrick's Aug. 28, 2002 MEMO RE: DETROIT COORDINATED CAMPAIGN to Democratic Party Nominee for Governor Jennifer Granholm reveals "To the victors go the spoils" thinking:

  ..."This is a commitment that we as leaders from the city of Detroit are
      making to the Democratic ticket -- but we expect the same in return
   ..."A commitment to the city from the state in the form of government
      facilities located in the city, any new construction of government
      buildings need to happen in Detroit, and more state contracts need to
      be granted to Detroit based, minority owned businesses."

As the former leader of the Democratic Party in the Michigan House of Representatives, Kilpatrick has unclean hands from his role with the Engler Administration violating our Michigan Constitution by borrowing $398 million in bonds to refurbish the former General Motors Headquarters Building on Grand Blvd. in Detroit to more suitably house 2,500 state employees; by pledging the full faith and credit of Michigan citizens statewide to borrow an additional $800 million to be spent by the Detroit Metro Airport Authority that is controlled by the same corrupt public officials that obligated statewide taxpayers to repay $1.1 billion in illegally issued bonds just three years ago that are now headed for default, and by encouraging no-bid contracts and unlawful borrowings to pay for gross mismanagement of the Detroit Water & Sewerage Authority by encouraging unchecked exploitation of Detroit and suburban homeowners.

Taxpayers United is anxiously awaiting return of three-question questionnaires sent to political candidates who, if elected, will take an oath to abide by the will of the people expressed in our Michigan Constitution. The questionnaires seek "Yes" or "No" signed response from each candidate declaring his/her position on construction of Engler's proposed State Police/Military Affairs Building in downtown Lansing.

Unlike their opponents, some incumbent politicians are reluctant to answer in time for Taxpayers United to "widely disseminate the answers to our members and to the media and voters throughout your District " (or "our State").

Others, like Melvin Butch Hollowell, Democratic Candidate for Michigan Secretary of State wrote back: "We have been obligated to restrict our response to only those groups specifically aligned with the Secretary of State Office."

Hollowell is unsuccessfully trying to evade an important campaign issue by expressing ignorance that taxpayers pay the Secretary of State, as a member of the Executive Branch of Government, to represent them by fulfilling Constitutional as well as statutory duties on the State Administrative Board, and by maintaining many of the most important records of state and local government including state statutes and commercial financing statements.

The CATO INSTITUTE in Washington D.C. stated in a published state-by-state comparison of Total State Revenues: "Gov. Engler has been on a spending spree for years".

Thomas Clay, senior research associate with the nonpartisan Citizens Research Council of Michigan, concluded in a recent report:

   "Both major state funds -- the General Fund and the School Aid Fund --
    have very large operating deficits.  That's something that state
    officials cannot legally allow to happen.  Michigan's Constitution
    requires that the budget be balanced.  So state officials have only two
    choices:  Find some way to get more revenue, which means raising taxes,
    or make cuts."

The U.S. Census Bureau issued figures this month ranking Michigan the second highest tax Great Lakes State. High spending by Michigan state government is pushing taxes ever higher in comparison to both neighboring states and all other states.

David Littmann, Ph.D. chief economist for Comerica Bank in Detroit concluded earlier this month:

   "State spending is a key determinant of how well a state will do
    economically.  State spending must be supported by state taxes, and the
    greater the government spending, the less is available for the saving or
    investment or private spending that generates economic growth and more
    jobs.
  "Michigan's total personal income has been below the national average for
   some time.  This is attributable to the state's continuing spending
   burden."

"Gov. Engler expects legislators to disregard Constitutional constraints during the Lame Duck Session in November and December in order for him to continue Michigan's bi-partisan spending spree, and to break ground on the State Police/National Guard Headquarters Building before year-end despite the State having at least a $1.5 billion deficit," McMaster said.

"If we can't get elected officials to comply with our Constitutional right to vote on ambush bonds before the State issues them, which are tax hikes, we'll seek remedy in the courts. Taxpayers United's lawsuit against the State of Michigan will be activated in Ingham County Court Judge James Giddings' courtroom immediately after Engler finagles a majority vote out of the Joint Senate-House Capital Outlay Committee.

"And we'll find some way to punish politicians who take special interest campaign contributions in exchange for votes to continue Michigan's spending spree on borrowed money when the State is already hopelessly in debt," McMaster concluded. "Grassroot taxpayers will not allow bribery to be inbred in Michigan politics."

Taxpayers United was founded in 1976 and is today Michigan's most effective non-partisan, non-profit, statewide grassroot taxpayer organization.

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CONTACT: Bill McMaster, State Chairman (Volunteer), [phone], for Taxpayers United