State Ownership of Utilities using a Constitutional Amendment

On November 29, 2022, Rep. Rabhi introduced House Joint Resolution Y, which proposes an amendment to the state constitution of 1963, by amending sections 15 and 29 of article VII and adding section 31 to article V, to create a state public utility. It has been referred to the Energy Committee.

The state would create a public utility and a subsequent public utility board. This board would then purchase or acquire all of the electric and natural gas generation, distribution, or transmission facilities owned by any investor-owned utility in this state by eminent domain. This means the state will come and forcibly remove your property from your possession if you are an owner or shareholder in any of the above utilities, and it is completely legal as long as they give you compensation.

With the acquisition of all public utilities, now the state can set all rates, fares, fees, charges, services, rules, conditions of service, and all other matters pertaining to the formation, operation, or direction of the state public utility; and they can arbitrarily establish lower rates for low-income residential customers, which they are already claiming they will do.

Now the state is free to eliminate fossil fuels and build across this state accessible, rapid-charging infrastructure for electric vehicles, making rapid investments in the distribution network in Michigan. With this goal, there is nothing standing in the way to stop the state from eliminating fossil fuel energy in Michigan, leaving most of us in a very bad situation.

Further, according to this resolution, a person, partnership, association, or corporation, public or private entity, operating a public utility will not have the right to any highways, streets, alleys, or other public places of any county, township, city, or village for wires, poles, pipes, tracks, conduits, or other utility facilities, without the consent of the duly constituted authority of the county, township, city, or village; nor will they have the right to transact local business within a county, township, city, or village without first obtaining a franchise from the county, township, city, or village.

The state public utility established in section 31 of 6 article V will have the right to use the highways, streets, alleys, or other public places of any county, township, city, or village for wires, poles, pipes, tracks, conduits, or other utility facilities, without the consent of the duly constituted authority of the county, township, city, or village. The state public utility established in section of article V will not need to obtain a franchise to transact business in a county, township, city, or village.

This resolution is very dangerous and unconstitutional. Eminent domain, while currently legal, is a gray area to begin with and has, in the past, been used to deprive citizens of their rightful property. In addition, this resolution would essentially allow the state to dictate who can and cannot obtain services and use roads. Not only does this create a monopolistic situation, it is a violation of the local governmental rights by the state, and the citizens’ rights by extension.

Call your representative today and tell him or her that you want this resolution to never see the light of day.