Legislative Update: Key Issues Impacting Michigan’s Engineering Industry

ACEC/Michigan continues to monitor and advocate on legislation with major implications for engineering firms and the state’s infrastructure. Below is a summary of key developments shaping the policy environment.

State Budget and Economic Outlook

FY 25–26 State Budget Framework Update

On Sunday, September 21, legislative leaders and the Governor reached a tentative framework to avoid a government shutdown and finalize the FY 25–26 state budget. While details remain limited, this agreement sets the stage for final negotiations over the next week.

Key Elements of the Framework

• Transportation Funding: A shift of the sales tax on gas to support road projects.
• New Revenues:
  • A wholesale tax on marijuana estimated at $560M
  • A tax on heavy trucks using state roads is estimated at $400M

Legislative Process & Timing

• Senate: Convened in a rare Monday session on September 22. All committee meetings have been canceled for the week of September 22 to prioritize budget work.
• House: Has not yet announced its schedule but is expected to follow a similar approach.
• Budget Subcommittees: Could begin meeting as soon as the week of September 22 to finalize department-level details.
• Timeline: The next 8 days will be critical as lawmakers aim to conclude the process before the shutdown deadline.

What This Means

• The framework provides a roadmap, but significant details remain to be negotiated.
• While leaders are working to prevent a shutdown, members should be aware that disruptions remain possible.
• ACEC/Michigan will continue monitoring developments closely and share updates as soon as additional information becomes available.

QBS Legislation Moves Forward

HB 4774 would require state agencies to use Qualifications-Based Selection (QBS) when procuring architectural, engineering, or surveying services. The bill mandates public notices, transparent evaluation of qualifications, and negotiation with the most qualified firm, with exemptions for emergencies and smaller projects.

This legislation aligns Michigan with the federal Brooks Act and 44 other states. A hearing was held in the House Standing Committee on Regulatory Reform on Thursday, September 18, 2025. ACEC/Michigan Executive Director Ron Brenke, PE, testified in support.

Land Division Reform

Two bills, SB 23 and HB 4081, propose expanding allowable land splits under the Land Division Act of 1967. SB 23 increases splits from four to ten per 10 acres, while HB 4081 phases in this change over one year. Supporters argue this streamlines property development, while opponents warn of potential sprawl, infrastructure stress, and service challenges.

SB 23 has passed the Senate and awaits House review; HB 4081 has passed the House and awaits a full Senate vote.

Road Construction Lane Closure Restrictions

HB 4656 (introduced June 17, 2025 by Rep. Joseph Pavlov, with bipartisan cosponsors) would prohibit road construction projects from shutting down all lanes of a roadway. The bill amends the 1917 PA 165 (MCL 247.291) to ensure that at least one lane remains open to traffic during construction, unless otherwise exempted.

The bill was referred to the House Committee on Transportation and Infrastructure. If enacted, HB 4656 could significantly affect project planning, traffic management, and construction sequencing for firms working on state and local projects. ACEC/Michigan will track this legislation closely to assess potential impacts on safety, mobility, and project delivery.

Environmental and Water-Related Legislation

• SB 46 – Expands EGLE’s authority to ensure safe drinking water, including emergency orders without prior notice. Passed Senate; awaiting House action.
• SBs 246 & 247 / HBs 4389 & 4393 – Hazardous Waste Reform Package: updates definitions, increases fees, strengthens licensing oversight, and dedicates revenue for remediation. Senate bills have passed; House bills are in committee.
• SBs 385, 386, 387, 391, 392, and 393 – A broad package addressing environmental cleanup, liability, and regulatory reform, including medical monitoring for hazardous substance exposure and updated remediation standards. Currently awaiting action in the Senate Standing Committee on Energy and Environment.
• HBs 4192–4193 – Reform groundwater discharge permitting and fees. HB 4192 has passed the House and is in the Senate; HB 4193 remains in House committee.
• HBs 4352, 4353, 4354 and 4355 – Modernize and expand authority for municipal water/sewer authorities. Reported from committee and referred to second reading in the House.
• HB 4427 – Requires counties to issue “Brown Alerts” when sewage or E. coli exceed safe levels. Pending in House Natural Resources & Tourism.
• SB 504 – Requires EGLE to establish a microplastics testing and reporting program for public drinking water. Pending in Senate Natural Resources & Agriculture.
• SB 505 – Directs EGLE to create a statewide microplastics strategy, including monitoring and product regulation. Pending in Senate Natural Resources & Agriculture.

Regulatory Reform

Three bills seek to modernize professional licensure requirements:

• HB 4913 – Clarifies requirements for architects, engineers, and surveyors, requiring accredited education, examinations, and at least 8 years of experience.
• HB 4914 – Updates firm licensing rules, removing the requirement that two-thirds of principals must be licensed while strengthening reporting and responsible charge provisions.
• HB 4916 – Clarifies licensure language and experience requirements.

All three bills are pending in House committees.

Looking Ahead

ACEC/Michigan will continue monitoring these bills and working with lawmakers to ensure the engineering industry’s interests are represented. Budget negotiations and regulatory reforms will remain critical in the weeks ahead.

To review bill texts and track legislation, visit the Michigan Legislature website.

For more information or to get involved in advocacy efforts, contact:
Troy Hagon, Deputy Director
thagon@acecmi.org | www.acecmi.org