Thanks for joining the Courtyard Grou this day with guest Jim Holcomb, the CEO of the Michigan Chamber of Commerce.

He's against an effort to raise taxes on the rich.

Our lead story, an update on school funding there, making progress.

And a new candidate for governor on the R side.

His name, Tom Leonard.

On the OTR panel, Craig Mauger Elaina Durnbaugh and Zoe Clark.

Sit in with us as we get the inside out.

Off the record.

Production of Off the Record is made possible in par by bellwether public relations, a full servic strategic communications agency partnering with clients through public relations, digital marketing and issue advocacy.

Learn more at bellwetherpr.com And now this addition of off the Record with Tim Skubick.

Welcome back to Studio C for another edition of Off the Record.

Our thanks to Chuck Stokes fo piloting the program last week.

Thanks Chuck.

Look at we got three weeks ago you all sat around the table said there was no way in Hades that they're going to get that school aid budget by July 1st.

Remember?

Ms. Clark Do you remember?

Play the tape.

I just happened to have.

Anyway, so we haven't seen that.

Here they are.

They're going to come darn close.

I mean, they also could have written numbers on a paper napkin and sent that to the Senate to with every chance what the House passed has to pass the Senate.

But yeah, yeah.

Look at July 1st is important for the schools.

I talked to Tim Kelly yesterday.

By the way He and cammilleri his counterpart in the Senate, they chair the K through 12 budget, had breakfast together last week.

Yeah.

And they're talking an they're getting done, he said.

We're 70% done.

If we don't hit July 1st, we'll hit it within a week in government work.

That's good enough.

Yeah, I mean it's possible.

I think one of the interesting developments this week was yesterday you had a group of school organizations, principals school boards, administrators, sent a letter to the legislative leaders and saying, hey, you guys need to get this done immediately.

That's the second letter They sent one a week and a half.

And then they said also in this letter, which I think this is the fascinating part to watch they said you should not balance a roads deal or an income tax deal on the backs of Michigan students.

And that's what I think is, you know, there's 70% there.

Matt Hall has this plan.

Speaker Hall has a plan to try to find $3 billion for roads.

If you look at the numbers, it looks like they're finding that money in the school aid fund budget right now by using reserves, by moving money to higher ed, then moving the general fund money from higher ed to whateve is going to be in this budget, that the part of the budget they haven't released yet.

You have the school groups saying, we don't want you taking this money from schools that are struggling right now to try to make this road deal happen.

So how can the Democrats and the Republicans reach a deal on this unless they figure out this roads thing as well?

Because that's the mystery.

You're assuming that the letter works.

I'm not assuming that it works.

I'm stating that I'm stating that happened.

I don't know if it works or not, but I think it's a it points to the question that we don't know the answer to.

If you're the Republicans, how do you do a school aid budget without leaving some money for roads?

And if you're Democrats how do you let the Republicans essentially hold ou billions of dollars for some yet to be determined road deal?

If you're House Republicans, you'll say that your plan has the biggest per pupil increase out of all of the plans that have been presented.

The speaker keep saying this.

And now in this letter from the school groups, they say the budget that the House Republicans have put out is, quote, deeply flawed.

The school groups are not excited about this budget that the House Republicans have passed.

So so how does how do these two things fit together?

You mean they're not excited to find their own money for universal breakfast and lunch and transportation and all of these categoricals that were eliminated?

Yeah, And that's where it gets into I mean, this has been going on for decades.

How do you define what is goo about a school aid fund budget?

I just keep thinkin this whole year about deadlines and this legislature, I mean, only we are we are in the middle of June, halfway through the year, five bills have been passed and every single one of these bills simply passed was because there was a deadline.

Right.

You had minimum wage because the February 21st deadline, then you had the bills to push back transparency, paperwork, uploading because there was a deadline.

Then you have the extension or the the okay of of less school days because of the storm up north because there was a deadline.

But, Ms.

Clerk, when you were doing your graduate paper.

No I was the.

Ti you know me I'm such an A-type.

I didn't wait till the last minute.

Come on.

I'm just saying we know this is what the legislature's like.

This is not normal.

I agree.

But what I think is fascinatin this time is we have a July 1st deadline.

Statutory.

Fair.

But is this going to be one of those things that they are willing to push back on?

And I think that's a sign of what your priority, if you took the rhetoric on that stage, that you did a nice job on the island with the four leaders.

Yes.

No the mud wrestling match.

Okay.

Yeah.

If you see this is just some folks know this was the first time that the quadrant.

Right.

The four leaders wer obstensibly together on stage.

Well, if you took that rhetoric that came out of that event and look at where we ar today, folks, that is progress.

It's progress.

And it's not surprising.

I mean, at some point they have to get together and get something done.

I mean, you had the speaker say previously we shouldn't be having these closed door meetings to negotiate.

Andwere going blow by the July 1st.

Yeah.

And he said, that's you.

And now he's talking about the July 1st deadline in saying it's the Democrats.

They want to blow by it.

And now he's having closed door meetings to negotiate the budget.

So how much of this.

Actually he never changed his mind.

He always wanted July 1st.

That's what I was told yesterday.

It was misleading.

I don't know what Speaker misleads press corps.

There's a there's an original thought.

July 1st deadline does not matter as it is in state law, but it matters to these school groups and it matters to the local district If you're going to negotiate with teachers of contracting you don't know how much money you're getting.

It a little tough to do.

Real question.

You can't guess it either.

There was some peopl who were saying, oh, you know, you kind of know where it's going to be.

And it's like you look at the House budget, this is the Senate budget.

You have no ide where this is going to end up.

And local governments, too, right?

It's not just higher ed and it' not just K-through-12 schools.

There's local governments tha are on July 1st deadlines also.

Also, where is that budget to be found?

Well, this is and this is what I'm saying is it's just it is as much as folks are saying, well, we're getting close, we're 70% there, 70% does not mean a lot for folks that are trying to balance their budget in communities.

Ye of little faith.

Oh yea, you ca roll this tape in a few weeks.

Then I got two to play.

All right, let's talk about Tom Leonard running for governor.

It's fascinating, isn't it?

I mean, this is a guy that has run statewide.

He is well-liked by a lot of the Michigan Republican Party activists, people that have been involve with the party for a long time.

He is if this term matters any longer, he is a conservative, a fiscal conservative person.

He's governed with a conservative kind of ideology.

But this whole situation with President Trump and Tom Leonard lingers over all of this.

And what is that?

The situation is that at one point President Trump nominated Tom Leonard to be the U.S. attorney for the Western District, and then a few years later, he turns around and issues an entire letter bashing Tom Leonard as Tom Leonard, who's running for attorney general.

Trump is so influential with the primary electorate.

Where is Trump going to come down on this?

And how does Tom Leonard walk that line.

I've heard from folks that he's going to be branded as too centrist, too moderat for the Republican Party today?

There's a kiss of death.

Based on what?

I literally asked Tom Leonard, that yesterday I said to him, can you actually win a Republican primary in today's Republican you know, a party.

I think what's going to be really interesting, What did he say.

Oh, of course, he said, of course I can.

And, you know, work hard, right.

Great question.

I can't I'm actually dropping out, No, of course he said he can.

But I, I think what I'm thinking a lot about to that point is what is his lane in this primary?

We have we certainly know that Donald Trump will be the huge, you know, 800 pound gorilla in all of this.

He gave a not so kind shout out, it seemed, to John James last week at the White House saying he was not super necessarily happy that John James decided to run for governor, something that we've talked a lot about, you know, being talked about in Lansing and D.C..

I thin what I'm really fascinated by, though, with this primary i are we going to see what we saw in 2010 when you had, you know, Hoekstra and then Mike Cox again?

Yeah.

Yeah.

And and you then had Rick Snyder when he was it, you know.

Totally different party.

Totally, totally different.

The dynamics are the same.

Tom Leonard's entrance into this race has now made it one of the candidates easier to win because they don't get as many votes.

I mean, every time and right now, we still don't know that there aren't going to be more candidates.

Snyder won with 30% of the primary vote.

Boys and girls is what I am saying.

It seems like every candidate that gets in brings down that threshold that you nee to win as you're talking about.

But I mean, there's so much more here.

I mean, the Trump influence, is Trump going to endorse John James?

And then you get int this whole thing of, you know, I've been watching this for a few years, Are we in the Republican side of politics, in like a post policy world where people's policy proposals, their idea on what they're going to do to govern, does that matter?

I mean, Tom Leonard knows al but like he has a policy agenda.

He has these things he wants to work on.

Are the voters going to care about that?

Do the primary voters care?

What Repubicans are doing right now is they're just mirroring what's coming out of the federal level?

Yes, mimicking it, copying it back.

So you have policy.

What is Tom Leonard's trump card?

Why do people.

Oh, hey, Tom Leonard.

He's my guy.

I mean, what he say he's running on is going to be positivity, right?

He keeps kind of talking abou the Dan Campbell positive, grit.

When I talked to him, you know, his it's he's talked about education, which we know, I think 2026, the gubernatorial election is going to be an education election.

And it's somethin that Republicans and Democrats are going to have to come out with some policy proposals.

The thing, again, that we hav to note in all of this, though, is the Mike Duggan factor, which is just, again, as we're talking about what this election is going to look like and trying to hearken back to elections of past having a strong independent candidate who Rich Czuba, you had on the show a few weeks ago, says this actually pulling from Republicans and Democrats makes this a race like any other.

He I will I will say this about Tom Leonard.

I mean, there are a lot of people that are discounting his chances in this primary but what benefit does he have?

That benefit is he is able to talk to the conservative base of the party, kind of that Tea Party faction, if they're still around.

Remember who did he make the energy chair, Gary Glenn, who went after Consumers and DTE, is one of the few people that kind of actually went after the utilities.

But he also talks to like kind of the Republican donor base.

He's a lobbyist right now.

He was a finance chair for the Republican Party.

So he's got this ability to kind of reach both sides.

Will that matter in 2026?

I don't know.

We're still a long way away.

Dana Nessel found something to do yesterday afternoon.

I mean, this is such a wild story and I don't know if people understan fully the implications of this, but the attorney.

It's onl a half hour program.

I'll try.

The clocks ticking.

I can't find more time for you.

The attorney general of this state who is a Democrat, sent agents to essentially raid the offices of the governor's Economic Development Agency.

While the governor was out of the country.

In Australia.

Along with the director of the MEDC.

And I said this yesterday to someone, can you imagine the phone cal that took place between the MEDC office and the MEDC president who was in Australia?

I don't know what time that would have occurred in Australia, but people were like, we're going to we're goin to let MEDC answer this question I mean, if we could only hear the audio of the call.

What's wrong with that?

I mean, if she's got a job to do and she's after two people that she think broke the law and she needs more information, why not raid?

But I mean, there's nothing wrong with it.

I mean, we have no idea what evidence the attorney general's office has obtained.

They've obviously gone before a judge and proven something to get the search warrants authorized.

Let's just point out that she is alleging the two people misused state grants for their business.

That's what they have been investigating.

Is this rush of state grants to some people who appeared at least to records available to be using them for things that could have benefited themselves.

We'll find out more about this as the details become public, If Craig had the authority, he would also raid the MEDCi.

That's not true.

I would love to see the records.

FOIA request, true.

You know, I mean, I thought the PR flack excuse me, the PR person had a great line.

This is unwarranted, you know, barging in here.

And they literally had a warrant.

Yeah, but it's fascinating.

All right.

Let's talk to Jim Holcomb, who has something to say about raising taxes on the rich.

Mr. Holconb, please.

How are you doing?

I'm doing well.

Thanks for having me.

Let's check off some boxes.

Have you guys flyspecked th language of this ballot proposal that would raise the ta on the rich to fund the schools?

Have you looked at the language?

We have looked at language.

We continue to look at it.

But I want to start one point with the premise taxing the rich.

Let's be clear.

We already tax people.

The more income you make, the more taxes you pay.

So it's kind of a kind of a speculative term.

I'm sure it's been focused, tested and polled, and everybody thinks it's kind of a cutesy term.

But current law, the more yo make, the more you pay, Right?

The box is not yet checked.

Okay.

So you're looking at the language.

The question is, have you foun a hook to haul them into court now.

I think this is a ver poorly drafted ballot proposal.

If you look at a lot of the vague terminology and new terms that are being used, I think this is for many issues.

This is going to lead to decades of litigation.

The question is, is it rip for a lawsuit to block them now?

I think it's absolutely ripe that people are going to challenge just just the way it's drafted.

Including your group?

I'm going to say that we're going to continue to do the research.

I'm not going to come ou say what we're going to do today because we have to do our due diligence.

But a cursory reading of i just shows how poorly drafted it is, and it' either really sloppily drafted or purposely misleading.

Either is unacceptable in the Constitution.

You get it off the ballot game over.

It's not game over, it's just better for policy.

We need to have serious conversations about education and tax policy in the state and this isn't the way to do it.

Out of all of these initiatives that are being floated right now, a referendum on the tipped minimum wage issue, you have this taxing wealthy individuals to provide funding for schools.

Are you guys watching all of these at the chamber?

Is there one that concerns you more than the other?

We absolutely look at everything.

We talk to our members.

We focus on what's going to be most impactful in the state.

This tax proposal, the minimum wage proposal are certainly things we're focused on.

Our staff digs into them.

We routinely talk to our friends and allies, and we're looking for people who say I want to make Michigan better.

We don't need to be California, we don't need to be ballot palooza.

We don't need to be governing this way.

We have elected leaders and we need to hold them accountable.

And for all of us an for voters, we need to engage.

It's up to us to make sure we're sharing our opinion and vision with them.

Jim, I'm not sure if you saw the guest last week who is behind this ballot proposal and one of the things that she talked about was polling that they have that just, you know, the message, right.

Tax the rich.

Yeah.

Polls really well.

I'm curious, you know, whether it's the legalese or what it would actually do.

What does that mean in 2025 when there does seem to be this sort of vibe, right against the billionaire class, you know, folk coming out for Bernie Sanders?

I mean, it's a messag that's resonating with voters.

And that's the problem They'r working policy based on polling.

But if you actually read the language and look at the impact, this is going to impact Main Street.

This is going to hit real people in communities across our state, you're going to impact the entrepreneur, the small business owner.

You're going to impact that family business that's just clawin every day to keep the doors open because they pa tax on their profit as income.

But that's not they aren't taking a big paycheck home every week.

They're taking that money, they're reinvesting it, they're hiring staff, they're expanding their operations.

This isn't about penalizing them.

And that's unfortunately what they're going to do.

They are going to damage our economy and they're going to crush small business.

Well, and kind of to Craig's point, with a lot of proposals, this is looking to generate more revenue.

We've also seen discussions in the legislature about increasing corporat income tax, again, going after those who are making the mos to try to generate more revenue for the state.

Does the Chamber have any thoughts on kind of these other attempts to to increase revenue, putting it on Michigander who are making more and trying not to put it on Main Street?

But you aren't you aren't putting on Michiganders who pay more.

If you want to avoid this tax, you can.

And unfortunately, many peopl will then move out of the state.

You're going to hit Main Street, you're going to hit that small business because they are pastoring entities and you're really going to create a lot of damage.

We have plenty of money, I think, in the state.

What we need to do is spend it more efficiently, whether it's for education, whether it's for roads, for whatever program we want, we need to have a better, more robust.

You talked earlier in your in your session about the budget process.

That's what this is about.

While spending money efficiently and wisely, this is exactly the wrong proposal at the wrong time.

You're going to make Michigan less competitive.

The Tax Foundation has research out there that shows the negative correlation.

The more that you increase, taxes become less competitive and tax breaking, the more people move out of the state.

There's a direct correlation.

We need to attract people to Michigan and make sure we're welcoming to all.

This is the exact wrong approach.

What if the righ what if this $1.7 billion helps to turn around a failing education system?

But I don't think they aren't right.

I think if you just loo at the terminology in the bill, they say it's about education.

This is nothing.

There's no concrete plan in what they've proposed to improve education.

In fact, if you look at the wording.

You don't put that in a ballot proposal.

You put in the means to get there.

No, but they're trying to do that.

When you use the term like local public school districts, what does that even mean?

You know, the legal research that I've seen thus far, you're going to exclude a lot of schools and you're going to exclude tens of thousands of kids.

Why aren't we looking to help all kids?

So every kid has a chance in Michigan.

I mean, the language that I saw that they sent me did have some spending.

Here's where you should spend this money on.

I think class sizes was one of the things.

I mean, salary increases salary increases for teachers.

But you have to break that down because words matter.

What is attractin and retaining quality educators, What is an educator is that only a teacher is every person who comes in contact with the student.

Is that support staff.

When yo talk about class.

Maybe it's all of them.

But we don't know.

And that's what you should be muddling up the Constitution with vague terms.

If you talk about classrooms, that's another good one.

Class sizes.

No, it says in there you have to spend money in classrooms in that language.

When you're looking at the preface up above, I' talking about the actual wording in the constitutional ballot.

It talks about classrooms and they talk about career and vocational technical education.

Great thing.

What?

What?

But what?

Well, what is the classroom?

There's a lot of kid who get that type of training.

They don't do it in a traditional classroom.

That's why that definition matters.

What about the kids who take something in construction management and they learn it onsite?

Can you help them?

What about virtual learning?

The teacher is not in the classroom, the students not in the classroom.

Can you spend money to help them learn?

What it is?

This is a questio that I had coming in here today.

What does the Michigan Chamber want to see happe to improve Michigan's schools?

Is that on your organization's radar?

How important is that right now to the future?

It's absolutely vital.

I think talent, attraction, retention, the state is vital, i vital.

Not only to our members.

But the entire do it though you do it through good, serious polic debates.

You don't do it through gimmickry.

So what's the policy that you all have?

I mean, that's I mean, you get you said earlier that, you know, hey, we don't necessarily need more money to improve the schools.

And I've heard that said a lot in the capitol lately.

But I'm not hearing a specific plan for for how you do that Which is why you need to have a debate.

It's not incumbent upon one person, one group or one entity to say, here's the plan.

We should be using the process.

You should have real substantiv debates in committees and say, this is what we need.

We know reading scores are abysmal.

We know math is abysmal.

I'm not saying that I said the Michigan Chamber and I have the answer.

What I'm saying is we're committed to education for all kids, not a certain subset, and we can't damage our economic climate in our account.

Wouldn't additional mone for literacy programs help that?

Is that covered under the proposal?

If that's not in classroom, d we know that would be covered?

That's the point.

This is so poorly drafted, you can have a lot of platitudes, but can you really get to actionable items?

Do you think that the state legislators should be shifting money away from the school aid fund to essentially free up dollars for a roads deal?

I think the legislators should be looking to balance our budget and do it most efficiently?

I can't comment on that because I haven't looked at the specific proposal on it.

I'm not going to sit here to say pick this over that.

What I'm saying is they're elected to do that's our job to to weigh in and they're in the process right now.

As you mentioned earlier, both the Senate and Hous are looking at record per pupil funding.

Even the governor said in her state of the state, we're spending more and getting less.

We're spending more per pupil than most states and getting a worse return on our investments.

So we're talking a lot about possible constitutional amendments, referendum, whether it has to do with the minimum wage, the possibility of ranked choice voting is out there.

But one ballot proposal that we absolutely know voters will vote on in 2026 is whether or not they want to see a constitutional convention.

Is the chamber going to take a position or a stand on an yes or no on a con-con?

We actually have that coming up?

We'll be talking with our members about it.

Historically, we've been opposed to that.

I think you open up a lot of problems when you put everything on.

But I think we're at a poin in time where people are saying, do we need to take a global look at it and look at what are the costs and the benefits and what can really be done, but also what's the harm that could happen when you open up the entire thing.

What is your gut tell you?

My gut tells me it's a bad thing to do.

With tha based on just this first read.

Would that be your recommendation?

I'm not going to make a recommendation until we do all the research, and my job is to listen my members and make sure I'm articulating their voice.

So I'm going to make sure I listen to them first before I take a firm stance.

Were you surprised that Matt Hall thought it was a good idea, the Speaker of the House, to to revisit and have a con con?

No, I think everybody should be talking about this.

I think we get into the situation where we all want to dra the line in the sand too early.

We all ought to be contemplating these issues.

We ought to have serious debates.

We ought to have conversations.

Because you may say I may have one opinion and you give me new facts and evidence.

I go Oh my gosh, that's really good.

So I really need to change my opinion.

We've gotten away from that in the process, and I think that's why we're in the situation.

We are we're getting harmful proposals like the current one we're talking about because we don't have the conversations constantly and they aren't substantive.

They're political.

We made news here today because you've just agreed on Con-co with a guy named Curtis Hertel.

Stop the presses.

He called it a disaster.

See Bipartisanship everywhere.

Curtis is a good man.

I don't have any problem agreeing with him.

But look, the argument is from the Republican standpoint, there's a lot of stuff that the Democrats have done over the last ten year and we want to go in and undo.

Do you believe that should be done?

I believe tha that's probably their opinion.

It's up to them to decide whether how they're going to support.

What I said is I'm going to listen to my members see what they support, what you want to put right to work back in state law.

I think when we got rid of right to work was absolutely the worst decision we could have made.

It's made us less competitive, but you have to look at the entirety of a process, not single issue.

And that's the problem We have in politics right now.

We're single issue.

We're single issue voters we're single issue legislators, and we're single issue.

And much of our conversation there needs to be serious, substantive debate.

We're talking about education in Michigan.

We need to make sur Michigan is good for all kids, that they all have a pathway to greatness.

And, you know, we don't need the tricks that are going on right now.

The Michigan Chamber used to engage heavily in Supreme Court races in the state.

You're talking about challenging this potential ballot proposal in the courts.

Democratic nominated justices have a 6 to 1 majority.

Do you all have a plan to get back a conservative majority on the court?

We still engage heavily in Supreme Court race and we're still always engaged.

It doesn't matter if you're a Republican or Democrat.

We're going to support judicia candidates who are rule of law.

But do you have a plan to change what has occurred over the last five years with just ceding the ground conservatives to liberal justice?

No.

The plan i you continue to have the fight.

They've outspent the justices and people supporting them who've won in the last election, outspent people 15 million to 2.

On a scale of 1 to 10, on bipartisanship, what do you giv this legislature and Governor?

I give them I probably give them a five.

I think they're right in the middle.

I think there's a lot of conversation.

Why did it take you 10 seconds to get there?

But that maybe that's not a bad thing, you know, that's the whole thing.

With such a divided government you need to have conversations.

You don't want things jammed through.

That's what we had wron when we had the trifecta before they were jamming through bills that didn't have support, but they could do it politically.

Historically, they're not having conversations though.

Well, I think I don't think you should take everything you see and everything that people will give to you to report as gospel.

I think there are a lot of conversations happening.

I think people talk more than we want to Mr. Holcomb thanks for the wisdom.

Thank you.

It's good to see you.

Good to see you.

All right, everybody, see you next week For more off the record right here, thanks for tuning in.

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