(Source:MIRS.news, Published 07/25/2024) All departments will no longer need to report to legislators on the severance packages given to outgoing state employees, particularly high-ranking department officials and directors, under the recently signed Fiscal Year (FY) 2025 budget. 

The now-deleted severance pay report obligations were first put into the FY '22 state budget following the COVID-19 era exits of former state Unemployment Insurance Agency (UIA) Director Steve Gray and ex-Department of Health and Human Services Director Robert Gordon. 

After Gordon left his post in January 2021, Gov. Gretchen Whitmer's administration paid him $155,506 in a separation deal, featuring two-sided confidentiality around why he departed abruptly.  

Meanwhile, the Michigan Department of Labor and Economic Opportunity (LEO) revealed in early spring that Gray received $85,872 in severance pay as he resigned in November 2020.  

In May 2021, MIRS reported that the Michigan Economic Development Corporation (MEDC), housed within LEO, paid out $507,503 to 22 former employees since 2013 when accrued vacation time was considered in severance compensation.  

Similar to other departments, the FY '22 budget required LEO to run an online site, posting severance pay in excess of six weeks of wages for former employees of any rank. LEO was instructed to submit a legislative report annually on the total amount of severance pay remitted to department employees in the prior fiscal year.  

The DHHS – the department where the Gordon departure originated – was directed to make a legislative report of severance pay for high ranking staff within 14 days following an agreement.  

In FY '22 and FY '23, the reporting obligations revealed that three DHHS employees were remitted $64,000 in severance pay. Meanwhile, the Michigan Department of Natural Resources (DNR) remitted $2,500 in severance pay to one outgoing employee in FY '22.  

However, multiple departments did not remit any severance packages in FY '22 and FY '23 that merited a report, including the Michigan Department of Transportation, the state's licensing department, Michigan's veterans affairs department, the Michigan Department of Environment, Great Lakes and Energy; the state's corrections department and the Michigan Department of Agriculture and Rural Development.  

"More information isn't always better, and you don't want to create burdens that really slow down the operation of government and make it ineffective, because the whole point is effective government," said Jim Townsend, the director of the Levin Center for Oversight and Democracy within Wayne State University's Law School.  

Townsend spoke to the big picture of how budgets can be used to improve government transparency, and when some transparency measures might not be the most effective.  

"If it's more just checking boxes and filling out forms that don't have a lot of meaning, then there's certainly room to be culling some of those reporting requirements," Townsend said. ""What you want to get is information that exposes how well the government is serving people. How is the end-user experience of government programs being affected?"  

He described a situation of legislators "chasing down every single minor detail of governance," falling into a trap of seeking to embarrass the executive branch.  

"These are your programs as much as they are the executive branch's programs, so you have to take ownership of them and work collaboratively rather than always point the finger," he said. "Good oversight is not about finger pointing. It's about problem-solving."  

Townsend served in the House as a Royal Oak and Madison Heights Democrat from 2011 through 2016, while Republicans led the chamber.  

Abby Mitch – the executive director of Michigan Rising Action, the conservative principles nonprofit – said to MIRS that of all the things that went wrong with the FY '22 budget, the severance pay language was not one of them. 

Although the budget language was designed during a Republican-led Legislature and Democratic executive branch, as well as near the end of the COVID-19 pandemic, Mitch said it was an uncontroversial part.  

"First of all, the idea of severance pay for like in the case of Robert Gordon, (or) the ex-UIA director, where they were essentially paid to not say anything about the terms of their departure or the conflicts they had on their way out the door, is not only antithetical to the idea of good government, it is just a gross misuse of taxpayer dollars," Mitch said.  

Some argue that the deletion of the severance pay language is the Governor justifying undisclosed departure payments of her appointees, and the ability to "use it to muzzle them," Mitch said.  

"What does it say as a society? I mean, I think it says that being a public servant is no longer sacred, which is a problem," she said. "The people who voted for this budget and were OK with this, or even felt like they proposed it, are basically acknowledging that they do not seriously care about transparency, and they do not think the public has a right to know how their money is being spent."  

Before leaving Lansing for summer recess, the Senate approved SB 669 and SB 670, expanding the Freedom of Information Act (FOIA), subjecting legislators and the Governor's office to public records requests.  

Under the bills, records related to a public official or judge being removed or suspended from office could be subjected to FOIA requests after the individual is removed. However, records surrounding the decision before the person exits are given a FOIA exemption.