Mark Sanchez: It's the new legislature's attempt to kind of fix something that your business groups and small business folks have been saying really needs fixing. Let's go back to last year. Actually, let's go back to 2018 I believe it was. You have this group did a petition drive to raise the minimum wage and change the law for earned sick time and the tip minimum wage for tipped workers and that went to the legislature, they had enough petition signatures. Went to the legislature under the state constitution, the legislature either adopts it or puts it on the ballot. The legislature at that time chose to adopt it. And then quickly did the adopt and amend tactic, which is you adopt something and then you immediately under the constitution, if you adopt it, you're allowed to then amend it. There was a lawsuit that says, yes, you can amend it, but not the same legislature that originally adopted it. Back last year, the Michigan Supreme Court sided with those groups said, Nope, you cannot amend this in the same legislative term and put it back into effect. The law that was originally the legislature adopted. So that's where we are. It would basically make major changes in the wages for a tipped workers. And you've been for months now having a lot of folks representing small businesses, saying this is really going to hurt folks. And there's also some new rules in there on earning paid sick leave. So, what you have now is here we are in January 2025, we have a new legislature controlled by the Republicans, at least in the House is controlled by the Republicans. And we've got a bipartisan bill. How many times are we hearing that term lately, bipartisan? And this could go to the full House this week. And there's also another package in the State Senate led by the Democrats. And so again, this all goes back to that. Michigan Supreme Court decision back in July. And basically what the bills would do is kind of keep the lower wage for tipped workers rather than phase it out over five years and continue to exempt employers with fewer than 50 employees from having to provide earned sick time benefits. It's kind of a lessening the impact of what that law would do. And it looks like it could have a good chance of getting through the legislature. It's coming through, it passed committee last week. There were two bills, 4001 and 4002. One of them passed on a 14-0 vote and another passed on a 15-0 vote. You don't see that too often. Republicans and Democrats are agreeing that this is something that needs to get changed. So, it goes to the full House now and then it'll go to the Senate. And you're going to have to see some quick action because this law takes effect in a month. And again, you've had a lot of voices in the business community in the state saying this is really going to hurt businesses and small businesses.
Patrick Center: So, employers feel that there's a cost burden here. What about employees? What voices are we hearing in Lansing taking up that cause?
Mark Sanchez: Well, you've got, again, your business associations, Michigan Restaurant Lodge and Association, and there was some testimony last week at the committee level from individuals who work as servers in restaurants, saying they like the system as it is right now. They like earning those tips and getting those tips. And they can live with the lower wage. They more than make it up through tips. And, you know, I live in a tourism community over here on the Lakeshore. And I know folks who they can make a lot of money on that was busy June, July, August, Friday, and Saturday nights. There's a lot of money going into their pockets through their tips. So, you know, that's, that's all open for debate. You have clearly some folks who would prefer to have the system changed and make that higher base pay. But right now, there are voices that want to maintain the system that you have. And that's what the legislature is looking to do, or at least pull back some of this new law that's due to take effect here in a month.
Patrick Center: We're talking with Crain's Grand Rapids Business staff writer Mark Sanchez. A lot of news coming out of Blue Cross Blue Shield of Michigan.
Mark Sanchez: Yeah. First, there's a new CEO at Blue Cross Blue Shield of Michigan. This is of course the health insurance that fairly controls about two thirds of the market here in Michigan. Tricia Keith stepped into the new role as the company's first female president and CEO on January 1. She replaced long-term CEO Dan Loepp as he retired. And in an interview with our colleagues over at Crain’s Detroit, she talked about, boy, we got to do something about these costs and we got to control this. It's paramount. You saw an average premium increase this year for the small group. This is employers with 50 and fewer employees. Average increase statewide among all insurers was 11.5%. And I heard stories from brokers of some small businesses, even larger businesses getting hit with 20%, 25%, 30% increases. So that's front and center for the new CEO. And then this week, we hear there are some, you know, they're making some moves there at Blue Cross Blue Shield. It seeks to cut $600 million in administrative costs over the next several years. And this will involve some buyouts of employees, non-union employees, have until the end of the month to accept a voluntary separation offer from Blue Cross Blue Shield. So, for all those employers out there who are just getting hammered with these healthcare cost increases, and this is part of the reason why, for several years up until a couple of years ago, post pandemic, that wages were a little stagnant in America. Employers were getting hit with these healthcare costs. So, employers understand the need to control these costs. And here's at least the first significant initiative coming out of the Blue Cross Blue Shield in Michigan under the new CEO to cut $600 million in costs and maybe flatten out some of these big increases we're seeing the last couple of years.
Patrick Center: Well, as we enter into 2025, a time to look back. Michigan Venture Capital Investment rebounded in 2024.
Mark Sanchez: A little bit, a little bit of a rebound, but at least it's going in the right direction. Bottom line, this is data that comes to us every quarter from the National Venture Capital Association and PitchBook, which is a kind of a finance research organization that follows capital investing. Bottom line, in 2024, we had 184 venture capital deals for $1.08 billion. That's up a little bit from 2023 when there were 169 deals for $1.05 billion. So again, not a big increase, but it's better than the alternative at least. It's going in the right direction. And interestingly enough, when you're reading through that report the other day, when it came out, boy, artificial intelligence is the big hot area for venture capital right now. Nationwide, you saw a lot of money flowing into that area. And that's probably going to be one of the dominant themes here coming forward for the next several quarters and perhaps several years nationwide for venture capital is folks are investing heavily in artificial intelligence.
Patrick Center: Crain's Grand Rapids Business staff writer, Mark Sanchez. Thank you so much.
Mark Sanchez: Thank you, Patrick.