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SB 880

Modifies provisions relating to taxation

2026 Regular Session

Strengthens the Low-Income Energy Assistance Fund to expand MEAP and equitably aid low-income households, with earlier funding decisions, CPI indexing, and opt-out rules.

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Bill Summary · SB 880

SB 880 — Summary (amends MCL 460.9t; Michigan Public Service Commission law)

Status note: SB 880 (as introduced and considered in 2024–25) amends section 9t of 1939 PA 3 (MCL 460.9t), which creates and governs the Low‑Income Energy Assistance Fund (the Fund). The measure has been considered alongside related Michigan energy‑assistance legislation (notably SB 353 and SB 881).

Main purpose

To strengthen and better direct the administration and funding mechanics of Michigan’s Low‑Income Energy Assistance Fund so the Michigan Energy Assistance Program (MEAP) can provide more (and more equitably distributed) energy assistance to low‑income households.

Key provisions and changes

  • Low‑Income Energy Assistance Fund administration
    • Requires the Department of Health and Human Services (DHHS), in consultation with the Public Service Commission (MPSC), to administer the Fund to promote:
    • Statewide access to MEAP and, to the extent possible, return funds to the geographic area from which they were collected;
    • Collaboration among DHHS, MPSC, energy providers, and administering entities so assistance is proportional to assessments in each area;
    • Education and outreach by energy providers and administering entities about available assistance.
  • Reporting requirements
    • State Treasurer: beginning December 1, 2025, annual report to the MPSC on total Fund collections and year‑end balance for the immediately preceding fiscal year.
    • DHHS: beginning March 1, 2027, and annually thereafter, provide the House and Senate appropriations subcommittees for DHHS and standing energy committees a report including (a) statewide distribution of Fund money, (b) county‑level totals of funds received and assistance awarded, and (c) outreach/marketing efforts.
  • Funding factor (the customer surcharge collected to support the Fund)
    • Moves MPSC approval deadline earlier (from July 31 to May 1).
    • Raises the permissible low‑income energy assistance funding factor:
    • Allows an initial increase to $1.25 on the bill’s effective date and thereafter by up to $0.25 per year, with an absolute cap of $2.00.
    • Beginning 2029, the cap is to be adjusted annually by the prior calendar year’s U.S. CPI percentage increase.
    • If the Fund balance at year end exceeds 10% of funds collected that fiscal year, the MPSC must set the funding factor so total collections do not exceed the prior year’s collections minus the reported remaining balance.
    • Removes the prior dollar‑amount cap used to calculate the factor (previously tied to a $50 million formula).
  • Opt‑out and utility obligations
    • Limits ability to opt out of collecting the funding factor to electric utilities, municipally owned utilities, or cooperatives with fewer than 45,000 residential customers.
    • Opt‑out utilities must file annual notice (deadline moved to April 1) and include counts of retail billing meters (by county).
    • Utilities that opt out must establish and fund their own energy assistance program for residential customers that covers electric and home‑heating needs consistent with MEAP eligibility and must provide notice to customers about available assistance.

Who is affected

  • Low‑income households and vulnerable populations (potentially expanded or better targeted assistance).
  • DHHS (additional program‑administration and reporting duties).
  • MPSC (earlier annual action and new oversight guidance).
  • Electric utilities, municipally owned utilities, and cooperatives — especially those with <45,000 residential customers (opt‑out mechanics and new obligations).
  • Entities that contract with DHHS to administer assistance programs (must meet any minimum allocation or performance requirements DHHS/MPSC set).

Timing / effective dates

  • Treasurer reporting begins December 1, 2025.
  • DHHS reporting to legislative committees begins March 1, 2027 (then annually).
  • Funding factor increases may begin on the bill’s effective date; annual increases limited to $0.25 and CPI indexing begins in 2029.
  • Opt‑out notice deadline changed to April 1 (annual).

Potential fiscal and program impacts

  • Expected to increase revenues to the Low‑Income Energy Assistance Fund by allowing higher per‑customer funding factors and removing prior calculation caps — enabling more assistance statewide.
  • May increase DHHS and MPSC administrative workload (reporting, coordination, outreach); potential need for additional administrative resources depending on implementation scale.
  • Requires opt‑out utilities to run and fund their own programs, which may impose new costs/operations on smaller utilities.

Note: SB 880 has been considered alongside SB 353 (which amends the Michigan Energy Assistance Act, MCL 400.1231 et seq.) and SB 881; several provisions in practice are coordinated across those bills.

Compiled from official sources — confirm details with the bill’s official record.

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