News Story

State Health Department Wants $1,000 Penalties For Breaking Its Rules

Agency also determines who conducts quasi-judicial trials

The Michigan Department of Health and Human Services has proposed a permanent rule to let it issue $1,000 fines to individuals who violate rules and orders it issues under authority granted by the Legislature in 1978. But based on their experience with the state during the COVID epidemic, officials in the city of Port Huron may have different opinions on that.

Robert Gordon, then-director of the state health department, issued temporary COVID-19 emergency rules in April 2020, which created $1,000 fines for violating department rules. He then issued new rules, which incorporated Gov. Gretchen Whitmer’s pandemic-related executive orders, and said that anyone who violated the department’s rules would face a fine.

The department later claimed that anyone who violates its orders would be subject to a $1,000 fine, even if the rules establishing a particular type of fine had expired. It said in May 2021 that it still had the option to levy fines, even though its earlier rules had expired on April 20, 2021.

The question of when an agency has the authority to create rules, as well as the penalties for violating them, came up in a dispute between city officials in Port Huron and another state agency.

The Michigan Occupational Safety and Health Administration issued a $6,300 fine to the city in 2020. MIOSHA said the city had violated some of it COVID-related rules, as well as some of the governor’s executive orders, according to The Detroit News. City officials disputed the fine, saying they did not violate the rules. They also said that since the state Supreme Court declared the governor’s orders unconstitutional, MIOSHA should dismiss the fine.

The state agency initially refused to consider dropping the fine, and the city spent thousands of dollars fighting it. In a deposition, the MIOSHA inspector admitted to burning the notes associated with the case, and the city threatened to depose the MIOSHA director. Six days later, MIOSHA filed a motion with the relevant state board to dismiss the case.

James Freed, Port Huron city manager said, “My heart breaks for all the small businesses and mom-and-pops that didn’t have an expert legal team, who didn’t have the resources to put MIOSHA under oath.”

Michael Van Beek, director of research at the Mackinac Center for Public Policy, is also worried about the imbalance of resources between state officials and citizens. Speaking of the health department, Van Beek said it has the advantage over individuals who wish to challenge its rules. Due to the complexities involved, anyone raising a challenge may need legal assistance. And if someone wants to appeal a fine, he added, the department selects the administrative law judges who conducts the proceedings. “It isn’t hard,” he said, “to believe that the department would tend to favor judges who side with the department more often than others.” Its attempt to formally establish the right to impose fines of its own making is just one case of an unelected bureaucracy making rules that will financially affect citizens, he said.

Lynn Sutfin, spokesperson for the state health department, said, “The department has determined that it is important to codify the civil penalties contemplated and authorized by the Public Health Code.” She added that the department will be responsible for issuing and collecting the fines.

Although the department has had the legal authority to draft rules to issue fines to individuals since 1978, Whitmer’s administration is the first to use it.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.