Economic Vitality Incentive Program (EVIP)

For years Michigan communities received funding from the State of Michigan through a program called Revenue Sharing. In 2011, Governor Snyder eliminated statutory revenue sharing and created a new program called the Economic Vitality Incentive Program (EVIP). It requires that communities produce a citizen's guide of its most recent finances, documentation of collaborations and consolidation and certification that new employee compensation criteria has been implemented to receive community funding. 

There are three criteria for qualifying for EVIP payments:

Criteria 1
Communities must have a citizens guide, performance dashboard and a projected budget report. The projected budget report must include at a minimum the current fiscal year and a projection for the immediately following fiscal year. It shall also include revenues and expenditures, a detailed listing of its debt service requirements and an explanation of the assumptions used for the projections.

Criteria 2
Communities must produce a plan with one or more proposals to increase existing levels of cooperation, collaboration and consolidation within their jurisdiction or with other jurisdictions. The plan must list previous efforts of cooperation, collaboration and consolidation as well as cost savings and estimates of any potential savings of future efforts. In 2012, the listed proposals must include a status update and the plan must include one or more new proposals.
Criteria 3
Communities must certify they intend to implement the following employee compensation criteria for any new, modified or extended contract or employment agreements for employees not covered under contract or employment contract.
Retirement & Benefit Plans
New hires eligible for retirement plans will be placed on retirement plans that cap annual employer contributions:
  • 10% of base salary if they are eligible for social security
  • 16.2% of base salary if they are not eligible for social security
For defined benefit plans:
  • A maximum 1.5% multiplier if employee is eligible for social security. If there is no retiree health care, a maximum 2.25% multiplier
  • A maximum 2.25% multiplier if employee is not eligible for social security. If there is no retiree health care, a maximum 3.0% multiplier
Also for defined benefit plans the final average compensation shall be computed using at a minimum 3 years compensation and can’t include more than 240 hours of paid leave. It also cannot include over time.

Health care premium costs for new hires shall include a minimum employee share of 20%, or the employer’s share shall be cost competitive with the new state preferred provider organization health plan on a per-employee basis.