Case Name: JUDICIAL ATTORNEYS ASSOCIATION v. STATE OF MICHIGAN; MAYOR OF DETROIT v. STATE OF MICHIGAN
Court: Michigan Supreme Court
Jurisdiction: Michigan
Decision Date: 1999-07-20
Citations: 460 Mich. 590
Docket Number: Docket Nos. 111785, 111786
Parties: JUDICIAL ATTORNEYS ASSOCIATION v STATE OF MICHIGAN MAYOR OF DETROIT v STATE OF MICHIGAN
Judges: Weaver, C.J., and Corrigan and Young, JJ., concurred with Taylor, J.
Reporter: Michigan Reports
Volume: 460
Pages: 590–625

Head Matter:
JUDICIAL ATTORNEYS ASSOCIATION v STATE OF MICHIGAN MAYOR OF DETROIT v STATE OF MICHIGAN
Docket Nos. 111785, 111786.
Argued October 7, 1998
(Calendar No. 9).
Reargued May 5, 1999
(Calendar No. 5).
Decided July 20, 1999.
Rehearing denied 461 Mich 1205.
The Judicial Attorneys Association and the Government Administrators Association brought an action in the Wayne Circuit Court against the state of Michigan, the Governor, the Attorney General, Wayne County, and the Wayne County Board of Commissioners, alleging that 1996 PA 374, the court reorganization act that merges Recorder’s Court into the Third Circuit Court and requires Wayne County to assume the operational and funding responsibility for the former Recorder’s Court functions without corresponding state appropriation, violates Const 1963, art 9, § 29 (the Headlee Amendment). Wayne County filed a cross-claim against the state, asserting that the state’s imposition on the county of certain of the former Recorder’s Court functions violates the Headlee Amendment. The court, Robert J. Colombo, Jr., J., granted the plaintiffs’ motion for summary disposition, holding that Act 374 violates the Headlee Amendment by requiring the county to provide an “activity” that it did not provide before 1978 without a state appropriation. The corut additionally held that the state’s obligation to provide an appropriation may be triggered under the amendment even if there is no shift of a state program to the local level. The court refused to consider any reductions in the county’s funding responsibilities to offset appropriation. The Court of Appeals, McDonald and Fitzgerald, JJ. (Markman, P.J., concurring in part and dissenting in part), reversed. It determined that the relevant activity or service under the Headlee Amendment was the “operation of trial courts,” and concluded that the requirements of Act 374 do not impose a new activity or service in contravention of the Headlee Amendment. The Court further found that because the state had increased the proportion of its funding of judges’ salaries, and that that was the only element of trial costs it paid in 1978, Act 374 also does not violate the amendment (Docket No. 201852). The county appeals.
The mayor of the city of Detroit and the city of Detroit brought an action in the Wayne Circuit Court against the state of Michigan and the Department of Management and Budget, alleging that 1996 PA 374, which required the city to assume Ml responsibility for funding and operations of the 36th District Court, violates the Headlee Amendment because, before 1978, the city did not fund and administer the civil and landlord and tenant divisions of the 36th District Court. The court, Robert J. Colombo, Jr., J., granted the plaintiffs’ motion for summary disposition. The Court of Appeals, McDonald and Ftkgerald, JJ. (Markman, P.J., concurring in part and dissenting in part), reversed. 228 Mich App 386 (1998) (Docket No. 201850). The city appeals.
In an opinion by Justice Taylor, joined by Chief Justice Weaver, and Justices Corrigan and Young, the Supreme Court held:
1996 PA 374 neither imposes new activities nor increases the level of activities on local units of government. Because in 1978 and under Act 374, the state’s only contribution to the activity at issue relates to the payment of judicial salaries, these matters are not subject to an analysis to determine whether the act decreases the state’s proportionate share of the necessary costs of the activities it requires of these two local units.
1. The Headlee Amendment, § 29, provides, inter alia, that a new activity or service or an increase in the level of any activity or service beyond that required by law existing at the time the amendment was ratified in 1978 may not be required by the Legislature or any unit of local government unless a state appropriation is made and disbursed to pay the unit for any necessary increased costs. The provision is triggered only when the state mandates a new activity by requiring local units of government to perform an activity that the state did not require local units to perform in 1978 or when it increases the level of an activity from the level that it required local units to perform in 1978. The intended limitations of § 29 on the state’s discretion do not include requiring the state to fully fund an activity that was locally funded in 1978, but is later imposed on a different local unit. A local unit required to assume funding for an activity it previously did not fund, but which local units were required to fund in 1978, would receive the state-financed proportion provided in 1978.
2. 1996 PA 374 neither mandates new activities nor increases the level of activities relating to trial court operations, even if a particular local unit had not previously performed it. Rather, it simply requires the two units at issue to do what the state required every local unit to do in 1978: fund the local district or circuit court, except for the portion of judicial salaries paid by the state. In 1978 and under Act 374, the state’s only contribution to the activity at issue relates to payment of judicial salaries. Under the plain language of § 29’s final sentence, the state’s only contribution to the activity at issue, however defined, is not subject to an analysis under the first sentence of § 29 to determine if Act 374 decreases the state’s proportionate share of the necessary costs of the activities that it mandates. Thus, it was unnecessary for the Court of Appeals to reach the issue.
Affirmed in part and vacated in part.
Justice Cavanagh, joined by Justices Brickley and Kelly, dissenting, stated that the Headlee Amendment obligations contained in the second sentence of Const 1963, art 9, § 29 run from the state to each unit of local government individually. The Court of Appeals erred in defining the relevant activity or service at issue in this case as trial court operations. Rather, the relevant activities or services are former Common Pleas Court functions and former Recorder’s Court functions.
Examining units of local government in the collective for purposes of determining whether the state has required them to undertake new or increased activities is inconsistent with the language and purpose of § 29. Defining the relevant activity or service in question as trial court operations is simply too broad a category. If all trial court functions fall under the broad category of trial court operations, the state is free to impose a multitude of laws and regulations on a local unit without an appropriation for the resulting increased costs. While 1996 PA 374 requires that the city of Detroit provide former Common Pleas Court functions and that Wayne County provide former Recorder’s Court functions, activities previously performed by other units of local government, the state’s funding obligation under the Headlee Amendment nevertheless is implicated because the activities are new to those particular units of local government. Consequently, the state should be required to make appropriations for any necessary increased costs resulting from the requirements of Act 374.
City of Detroit Law Department (by Phyllis A. James, Corporation Counsel, Joanne D. Stafford, Chief Assistant Corporation Counsel, and Dennis A. Mazurek, Supervising Assistant Corporation Counsel); Dickinson, Wright, P.L.L.C. (by Peter H. Ellsworth, Joseph C. Marshall, III, and Jeffery V. Stuckey), for the plaintiffs-appellants city of Detroit.
Jennifer M. Granholm, Attorney General, Thomas L. Casey, Solicitor General, and Deborah Anne Devine and Matthew H. Rick, Assistant Attor-
neys General, for defendants-appellees state of Michigan.
Edward Ewell, Jr., Wayne County Corporation Counsel; Fink Zausmer, P.C. (by David H. Fink, Gary K. August, Ruben Acosta, and Amy M. Sitner), for defendants/cross-plaintiffs/appellants Wayne County and Wayne County Board of Commissioners.

Opinion:
Taylor, J.
In these appeals, the city of Detroit and Wayne County challenge certain provisions of 1996 PA 374, a court reorganization act, on the basis that they violate Const 1963, art 9, § 29 (the Headlee Amendment). We conclude that Act 374 neither imposes new activities nor increases the level of activities on local units. Further, because in 1978 and under Act 374, the state's only contribution to the activity at issue relates to the payment of judicial salaries, these matters are not subject to an analysis to determine whether Act 374 decreases the state's proportionate share of the necessary costs of the activities it requires of these two local units. We accordingly affirm in part and vacate in part the Court of Appeals opinion.
i
According to its title, Act 374 is designed to revise the organization and jurisdiction of the courts. It is an effort to reorganize the state trial courts and to provide a uniform funding mechanism. For purposes of these appeals, relevant features of Act 374 are that it abolishes Detroit Recorder's Court and merges it with the Third Circuit Court and that it makes the funding units' responsibilities for the funding of the Third Circuit and the 36th District Court consistent with the responsibilities of funding units of all other circuits and districts. Sections 9931, 8271, and 591. Specifically, Act 374 requires Detroit to fund 36th District Court and Wayne County to fund the newly reconstituted Third Circuit Court. Detroit and Wayne County contend that Act 374's imposition of these responsibilities violates the Headlee Amendment because it places funding obligations on them that they were not previously required to shoulder.
In both cases, the trial court held that Act 374 violated the Headlee Amendment. The cases were consolidated on appeal and the Court of Appeals reversed, concluding that Act 374 did not violate the Headlee Amendment. 228 Mich App 386; 579 NW2d 378 (1998). We granted leave to consider whether Act 374 violates the Headlee Amendment. 457 Mich 884 (1998).
The relevant Headlee provision, Const 1963, art 9, § 29, states:
The state is hereby prohibited from reducing the state financed proportion of the necessary costs of any existing activity or service required of units of Local Government by state law: A new activity or service or an increase in the level of any activity or service beyond that required by existing law shall not be required by the legislature or any state agency of units of Local Government, unless a state appropriation is made and disbursed to pay the unit of Local Government for any necessary increased costs. The provision of this section shall not apply to costs incurred pursuant to Article VI, Section 18.
Drawing from this Court's previous decisions, the Court of Appeals aptly articulated the parameters of § 29 at 396-398:
The first sentence of this provision prohibits reduction of the state proportion of necessary costs with respect to the continuation of state-mandated activities or services. The second sentence requires the state to fund any additional necessary costs of newly mandated activities or services and increases in the level of such activities or services from the 1978 base year. This language does not guarantee that local units' spending levels will not increase from the 1978 level. Rather, the Headlee Amendment only guarantees that the state will not reduce its proportion of the necessary costs of existing activities or services, and that the state will pay entirely for necessary costs when it mandates new activities or services or to the extent the state increases the level of an existing activity or service. Increased levels of local spending attributable to other causes, e.g., inflation or the greater utilization of a program by the public, are not addressed by this provision of the Headlee Amendment.
The Michigan Supreme Court has interpreted § 29 to " 'reflect an effort on the part of the voters to forestall any attempt by the Legislature to shift [fiscal] responsibilities to the local government .'" Schmidt v Dep't of Ed, 441 Mich 236, 250; 490 NW2d 584 (1992), quoting Durant v State Bd of Ed, 424 Mich 364, 379; 381 NW2d 662 (1985). The two sentences of § 29 "must be read together '[b]ecause they were aimed at alleviation of two possible manifestations of the same voter concern .'" Schmidt, supra at 251, quoting Durant, supra at 379. To make the necessary comparison between state aid provided during the Headlee Amendment base year (1978) and a later year at issue, the Schmidt Court considered, at length, three possible formulations: the "state-to-state" formulation, the "local-to-local" formulation, and the "state-to-local" formulation. It ultimately adopted the "state-to-local" formulation. This method involves comparing "the ratio of total state aid for a required activity to total necessary costs for the required activity in the base year . . . with the ratio of state aid to an individual local unit of government for the activity to the necessary costs of that unit for the activity in the year of challenged funding." Schmidt, supra at 249. Under this formulation, "[t]he state is obligated to afford each unit providing the activity or service the same proportion of funding that the state provided on a statewide basis in the year that the Headlee Amendment was ratified." Id. at 250; see also Durant v Michigan, 456 Mich 175, 187; 566 NW2d 272 (1997).
In Schmidt, supra at 252, this Court discussed the voters' intent in ratifying the Headlee Amendment:
The state-to-local formulation satisfies the voters' intent in enacting the Headlee Amendment. When the voters ratified the Headlee Amendment, they sought to ensure that when the state mandates a program, funds are provided to the local government to pay for that program. The state-to-local method of calculating the state's obligation achieves the voters' desire to secure a minimum level of funding for the local government unit for mandatory programs and to link the mandating of programs with the necessity for taxing to pay for those programs. This approach also creates the appropriate balance between the state's desire for discretion in allocating funds and the desire of the local units of government for minimum funding. The state-to-local ratio provides a uniform allocation of resources for mandatory programs. The state is free to supplement that minimum funding on the basis of its perception of need, but the local government is guaranteed its proportionate share.
After reiterating these principles, the Court of Appeals proceeded to make a Headlee Amendment analysis of Act 374. The Court of Appeals concluded that "trial court operations" was the relevant activity or service under § 29. 228 Mich App 401-402. It found that Act 374 requires counties to fund the operation of the circuit courts, district units to fund the operation of district courts, and the state to fully fund circuit and district court judicial salaries. Id. at 402-403. It found that in 1978, state law mandated that local units fund and operate circuit and district courts and that the state subsidized a portion of judicial salaries. Id. at 405. It then concluded that Act 374 neither mandated new activities for local units nor increased the level of any activity required of local units. Id. Finally, it concluded that, despite incomplete information to perform the relevant equations, it was able to determine that Act 374 did not decrease the state-financed proportion of necessary costs of trial court operations to either Detroit or Wayne County from that provided on a statewide basis in 1978. Id. at 407-408.
n
On appeal here, the parties do not dispute the Court of Appeals findings regarding what Act 374 requires of local units and what state law required of local units in 1978 in terms of trial court operations. Rather, they dispute whether the Court of Appeals correctly identified the relevant activity under § 29 as "trial court operations." The parties' briefs and arguments before this Court suggest that these appeals turn on how the relevant activity is defined.
a
However, there is an underlying issue that neither the parties nor the Court of Appeals explicitly addressed: what the proper frame of reference is for deciding whether a mandated activity constitutes a "new activity" or "increase in the level of any activity." Resolution of this issue is important because § 29 distinguishes between the continuation of an activity mandated in 1978 and the imposition of a new activity or increase in the level of an activity. Section 29 prohibits the state from reducing its proportion of the necessary costs of existing activities while it requires the state to pay the increased necessary costs in full when it mandates new activities or mandates activities at an increased level. Specifically, the underlying question is: does § 29 address mandated activities that are new or required at an increased level from the perspective of a particular local unit or from the perspective of local units collectively? That is, is the second sentence of § 29 triggered by any mandate that requires a particular local unit to perform an activity that is new to it (or at an increased level) or only by a mandate that requires local units to perform an activity that the state did not previously require local units to perform (or at an increased level from that previously required of local units)? For ease of reference we will refer to the first option as "the broad interpretation" (an activity is "new" under § 29 merely if it is new to a particular unit) and the second option as "the narrow interpretation" (an activity is "new" under § 29 only if it is new to local units collectively, i.e., an activity the state did not previously require local units to perform).
In Schmidt, 441 Mich 253, in the context of discussing the strengths of the state-to-local formulation, we offered two examples that shed light on this question:
For example, if a district in existence in the base year was not providing a mandatory program when the Headlee Amendment took effect, this method would entitle the district to the same proportionate share as every other local unit that previously provided the programs. This formulation also simplifies funding where new districts are created by consolidation, or reorganization, or otherwise. If the newly organized district adds a program that was "mandated" when the Headlee Amendment took effect, any district providing the program is then entitled to the same proportionate share as every other unit providing the activity or service. Thus, the anomaly of funding at either zero or one hundred percent (pursuant to the second sentence of § 29) is avoided. New districts, like previously existing districts, would be entitled to the same proportionate share of state funding.
In both these examples, from the perspective of the particular unit, it might be argued that the state mandated a "new activity." But in both examples, this Court concluded that the particular local unit would not be entitled to one hundred percent funding as required under the second sentence of § 29 when the state imposes a "new activity." Rather, we concluded that these local units would only be entitled to the same proportionate share of state funding that other local units received for that activity. We concluded that these examples involved the simple continuation of an activity that the state required of local units in 1978, and did not impose on local units a new activity (or an increased level of activity), even though these particular local units had not previously performed these activities. In short, we adopted the narrow interpretation. Under the narrow interpretation of § 29, the relevant frame of reference is whether a mandated activity is new (or at an increased level) to local units collectively. We thus concluded that the second sentence of § 29 is only triggered when the state mandates a new activity by requiring local units to perform an activity that the state did not require local units to perform in 1978 or when it increases the level of an activity from the level that it required local units to perform in 1978. Two corollaries flow from this conclusion: 1) a requirement that a particular local unit fund an activity that was locally funded in 1978 would not constitute a "new activity" under § 29, regardless of whether the particular local unit previously funded this activity; and 2) a requirement that a particular local unit fund an activity at a level that was locally funded in 1978 would not constitute an "increase" in the level of activity, regardless of whether the particular unit previously funded the activity at this level.
We acknowledge that these conclusions are drawn from examples in Schmidt. Examples in an opinion are, by definition, dicta. However, these examples are consistent with both the language of § 29 and this Court's holding in Schmidt.
The second sentence of § 29 states in pertinent part:
A new activity or service or an increase in the level of any activity or service beyond that required by existing law shall not be required by the legislature or any state agency of units of Local Government, unless a state appropriation is made and disbursed to pay the unit of Local Government for any necessary increased costs. [Emphasis added.]
The use of the plural "units" in the first phrase of this sentence indicates that the state is not to require activities that are new or at an increased level from the perspective of local units collectively. Of course, the use of the singular "the unit" in the second phrase of this sentence indicates that the proper remedy for the imposition of such a new or increased activity is to pay the increased necessary costs to each particular unit. But the initial question whether a statute mandates a new activity or an increased level of activity is to be answered by considering local units collectively, rather than a particular local unit, according to the plain meaning of the word "units" in the first phrase of the second sentence of § 29. Thus, this Court's analysis of the two examples in Schmidt is consistent with the language of § 29.
Moreover, the principles underlying these examples clearly follow from our holding in Schmidt that "the voters intended neither to freeze legislative discretion nor to permit state government full discretion in its allocation of support for mandated activities or services" and that only the state-to-local formulation "gives full effect to the language and advances the purposes that voters sought to achieve in ratifying the Headlee Amendment." Id. at 242, 249-250. Specifically, as noted above, we held that the state-to-local formulation
creates the appropriate balance between the state's desire for discretion in allocating funds and the desire of the local units of government for minimum funding. The state-to-local ratio provides a uniform allocation of resources for mandatory programs. [Id. at 252.]
Assessment of the broad and narrow interpretations of "new activity" on the basis of these criteria— 1) balancing state discretion in allocating funds and minimum funding guarantees for local units, and 2) uniform allocation of resources — demonstrates that only the narrow interpretation meets these dual purposes of § 29.
First, we consider the effect of these competing inteipretations on the goal of not freezing legislative discretion. In Schmidt, we discussed several ways that the Headlee Amendment limits the state's discretion:
First, it expresses the desire to prohibit the state from requiring new or expanded activities without fully funding them. . . . Second, the language evidences a purpose of preventing the state from reducing "the proportion of state spending in the form of aid to local governments." . . . Finally, the language embodies an antishifting purpose that prevents the state from shifting "the tax burden to local government." [Id. at 254, quoting Const 1963, art 9, § 25.]
We reiterated that the two sentences of § 29 must be read together and that they " 'clearly reflect an effort on the part of the voters to forestall any attempt by the Legislature to shift responsibility for services to the local government, once its revenues were limited by the Headlee Amendment, in order to save the money it would have had to use to provide the services itself.' " Id. at 257, quoting Durant, supra, 424 Mich 379. Similarly, in Livingston Co v Dep't of Management & Budget, 430 Mich 635, 644; 425 NW2d 65 (1988), we stated:
[The Headlee Amendment's overall] plan is quite obvious. Having placed a limit on state spending, it was necessary to keep the state from creating loopholes either by shifting more programs to units of local government without the funds to carry them out, or by reducing the state's proportion of spending for "required" programs in effect at the time the Headlee Amendment was ratified.
We further suggested that legislative changes that do not create such loopholes do not implicate the Headlee Amendment. For example, we held, at 645:
While the state can, and sometimes does, mandate higher standards, benefits, and so forth, it does not necessarily profit from increasing these standards, and, therefore, the kind of escape hatch for the state that the Headlee Amendment was intended to head off is not created.
These holdings indicate that § 29 primarily addresses shifts from the state to local units. With respect to shifts of responsibility among local units, § 29 only guarantees that each local unit will receive the state-financed proportion of funding provided on a statewide basis in 1978.
The Headlee Amendment simply does not speak to all potential shortcomings of funding statutes. To the extent that the Headlee Amendment does not address perceived inequities of statutes, parties may seek relief through the political process.
These authorities indicate that the intended limitations of § 29 on the state's discretion do not include requiring the state to fully fund an activity that was locally funded in 1978, but is later imposed on a different local unit. The broad interpretation would result in the imposition of such a requirement and would therefore limit the Legislature's discretion beyond that intended by the Headlee Amendment. The narrow interpretation is consistent with § 29's focus on shifts from the state to local units and does not similarly hamper the Legislature's discretion in ways not envisioned by the Headlee Amendment.
The intent to assure minimum funding at 1978 levels would be met by either interpretation. Under the narrow interpretation, a local unit required to assume funding for an activity it previously did not fund, but which local units were required to fund in 1978, would receive the state-financed proportion provided in 1978. Under the broad interpretation, a local unit required to assume funding for an activity that it previously did not fund would receive one hundred percent state funding, even though the activity was locally funded in 1978 and other local units funding the same activity are guaranteed only the state-financed proportion provided in 1978. Minimum funding is guaranteed under both these readings of § 29; however, the broad interpretation is obviously more advantageous to the particular local unit because it would go beyond providing minimum funding.
In light of these observations, we next consider the intended balance between the dual goals of a) preserving the Legislature's ability to enact necessary and desirable legislation in response to changing times and conditions and b) guaranteeing a predictable level of minimum funding. The broad interpretation defeats the first goal by placing limitations on legislative discretion beyond those imposed by § 29, and distorts the second goal by providing in some cases full state funding where § 29 guarantees only the state-financed proportion provided in 1978. The broad interpretation would therefore undermine the intended balance of these dual goals. The narrow interpretation, in contrast, is consistent with both § 29's focus on shifts from the state to local units and § 29's guarantee of minimum funding. Therefore, only the narrow interpretation of § 29 honors the intended balance between legislative discretion and guaranteed minimum funding.
Further, the broad interpretation clearly undermines the intent to provide a uniform allocation of resources. Under the broad interpretation, two local units providing the same activity could receive widely different amounts of state funding depending on whether the unit performed the activity in 1978 (in which case it would receive the state-financed proportion provided in 1978) or was only later assigned the activity (in which case it would receive one hundred percent state funding). The narrow interpretation of § 29 would not create such friction-producing funding anomalies. Under the narrow interpretation, with respect to activities that the state required local units to perform in 1978,' any local unit required to perform that activity is entitled to the same state proportion of funding that was provided in 1978. Thus, only the narrow interpretation would further the goal of uniform allocation of state resources.
For these reasons, we hereby adopt the narrow interpretation. We hold that the second sentence of § 29 is only triggered by a mandate that requires local units to perform an activity that the state previously did not require local units to perform or at an increased level from that previously required of local units.
B
In applying this holding, we again note that the parties do not dispute the Court of Appeals findings regarding what Act 374 requires of local units and what state law required of local units in 1978 in terms of trial court operations. We agree with the Court of Appeals analysis of these issues and hereby adopt the following portion of its opinion:
Act 374, § 9931 abolishes the Recorder's Court and merges it with the Third Circuit Court effective October 1, 1997. Act 374, § 591 requires the county board of commissioners in each county to annually appropriate funds for the operation of the circuit court in that county. Act 374, § 555 requires the state to pay the salary of circuit judges and to reimburse the county if it pays an additional salary within prescribed limitations. Act 374, § 8271 requires the governing body of each district funding unit to annually appropriate funds for the operation of the district court in that district. Act 374, § 8104 also requires district funding units to finance and operate the district courts. Act 374, § 8202 requires the state to pay the salary of district judges and to reimburse the local unit if it pays an additional salary within prescribed limitations. Accordingly, under Act 374, the state mandates that counties pay for the operation of the circuit courts, that district units pay for the operation of the district courts, and that the state pay circuit court and district court judicial salaries.
A Headlee Amendment analysis next requires that we compare this with the operation of trial courts in 1978 — the Headlee Amendment base year. In Grand Traverse Co v Michigan, 450 Mich 457, 473-474; 538 NW2d 1 (1995), the Michigan Supreme Court stated:
"Despite the fact that the courts have always been regarded as part of state government, they have operated historically on local funds and resources. An unbroken line of cases stretching back 130 years recognizes the practice of imposing the costs of operating the courts on local funding units."
It stated, "[t]he widespread acceptance of the principle of funding most trial court expenses through local funding units has continued until today." Id. at 476. See also Wayne Circuit Judges v Wayne Co, 15 Mich App 713, 722, n 10; 167 NW2d 337 (1969), rev'd 383 Mich 10, 24; 172 NW2d 436 (1969) ("the county is the proper arm of state government upon which the necessary expense of operating the circuit court devolves"), opinion of the Court superseded and the opinion by Dethmers and Black adopted as the opinion of the Court on rehearing, and the opinion of the Court of Appeals affirmed [On Rehearing] 386 Mich 1; 190 NW2d 228 (1971). In Frederick v Presque Isle Co Circuit Judge, 439 Mich 1, 6; 476 NW2d 142 (1991), the Court stated:
"Traditionally, the county has been the primary unit in directing Michigan's criminal justice system.
"[The Frederick Court cites several examples of statutes requiring local funding for trial court activities.]"

In Employees & Judge of the Second Judicial Dist Court v Hillsdale Co, 423 Mich 705, 713; 378 NW2d 744 (1985), the Court stated that MCL 600.9947; MSA 27A.9947, added by 1980 PA 438, was an attempt by the state to eliminate local funding of state judicial functions. Second Dist Court thus clearly recognizes that, before that 1980 act, the state effectively mandated local funding of trial court operations.
Before Act 374 there was no particular statute that explicitly stated that local units were responsible for funding trial courts. Rather, as set forth above, a number of statutes addressing particular aspects of trial court operations clearly implied that local units were to fund trial courts. The mosaic of these various statutes, and the strong tradition of local funding of trial courts recognized in case law, demonstrates that state law effectively mandated that local units fund trial courts in 1978. Accordingly, we conclude that in 1978 state law mandated that local units fund trial courts.
The state contends that complete financial records from the pre-Headlee Amendment period are not available; however, it is apparently undisputed that the state's only contribution to trial court operations in 1978 was with respect to a portion of judicial salaries. Accordingly, in 1978 local units financed and operated the circuit and district courts and the state subsidized a portion of judicial salaries. [228 Mich App 402-405.]
These findings — that, both in 1978 and under Act 374, local units were required to fund trial court operations as a whole with the exception of judicial salaries — compel the conclusion that Act 374 neither mandates new activities nor increases the level of activities relating to trial court operations. Act 374 does not require any new or increased activities of local units. Rather, it simply requires the two units at issue to do what the state required every local unit to do in 1978: fund the local district or circuit court, except for the portion of judicial salaries paid by the state. The conclusion that Act 374 does not mandate any new or increased activities holds regardless of whether we define the relevant activity as "trial court operations" or by more specific categories because local units funded trial court operations as a whole (with the exception of judicial salaries) in 1978. That is, even if we were to separately consider the more specific activities included in "trial court operations," each activity required under Act 374 was required of local units in 1978. Therefore, Act 374's imposition of such activities on local units would not constitute a new activity or increase in activity required of local units, even if a particular local unit had not previously performed it. Accordingly, for purposes of applying the second sentence of § 29 we need not decide whether the Court of Appeals properly identified the relevant activity as "trial court operations."
m
Ordinarily, for purposes of the first sentence of § 29 — determining whether the state has reduced the state-financed proportion of the necessary costs of any existing state-mandated activity — it would be necessary to identify the relevant activity. Here, however, it is undisputed that, in 1978 and under Act 374, the state's only contribution to the activity at issue relates to payment of judicial salaries. The final sentence of § 29 states that it "shall not apply to costs incurred pursuant to Article VI, Section 18." Const 1963, art 6, § 18 governs judicial salaries. Therefore, under the plain language of § 29's final sentence, the state's only contribution to the activity at issue, however defined, is not subject to an analysis under the first sentence of § 29 to determine if Act 374 decreases the state's proportionate share of the necessary costs of the activities that it mandates. Thus, it was unnecessary for the Court of Appeals to reach this issue and is unnecessary for us to do so either. We accordingly vacate the Court of Appeals analysis of this issue and need not define the relevant activity here.
CONCLUSION
For these reasons, we hold that Act 374 neither mandates a new activity nor increases the level of an activity on Detroit or Wayne County and that it is not subject to an analysis of whether it decreases the state-financed proportion of the necessary costs of an activity with respect to these two units. Accordingly, we affirm in part and vacate in part the Court of Appeals decision.
Weaver, C.J., and Corrigan and Young, JJ., concurred with Taylor, J.
We also granted leave to consider whether Act 374 violates the Separation of Powers Clause, Const 1963, art 3, § 2, or the public employee relations act, MCL 423.201 et seq.; MSA 17.455(1) et seq. Our decisions regarding those issues are separately reported at 459 Mich 291; 586 NW2d 894 (1998).
The dissent correctly points out that Schmidt addressed the first sentence of § 29. However, this does not make Schmidt inapplicable to an analysis of the second sentence of § 29. In fact, the Schmidt Court specifically reiterated that "the two sentences must be read together '[b]ecause they were aimed at the alleviation of two possible manifestations of the same voter concern .'" Id. at 251, quoting Durant, 424 Mich 379.
We note that Act 374 similarly mandates the continuation of an activity already required of local units. Act 374 requires Detroit and Wayne County to do what the state required every local unit to do in 1978: fund the local district or circuit court, respectively, with the exception of the portion of judicial salaries paid by the state.
The issue is whether the state required any local unit to perform an activity in 1978. If it did, it is irrelevant how many or how few units were required to perform the activity. Under our approach, a subsequent requirement that other local units perform the same function at the same level would not constitute a "new" or "increased" activity.
The use of the singular "the unit" in the second phrase of this sentence also indicates that the proper remedy for a violation of the first sentence of § 29 (i.e., a reduction of the state proportion of the necessary costs of a continuing activity) is to pay the individual unit. We fully subscribe to the Schmidt Court's adoption of the state-to-local formulation and rejection of the state-to-state formulation in determining whether there has been a violation of the first sentence of § 29. We agree that § 29 accordingly "impose [s] an obligation on the state vis-a-vis each unit of local government with respect to mandated activities as well as new requirements." Schmidt, supra at 251. Any suggestion otherwise by the dissent is incorrect. There does not appear to be any dispute that with respect to continuing activities, the state must pay its proportion of the necessary costs (as determined under the state-to-local formulation) and that with respect to new or increased activities, the state must pay for all increased necessary costs. The issue before us, on which we and the dissent disagree, is what constitutes a "new" or "increased" activity.
The dissent criticizes our approach by providing two examples: 1) the state shifting activities formerly performed by several units of local government to a single unit, and 2) the state requiring every local unit to establish a separate "Recorder's Court" for criminal prosecutions. Were these scenarios to occur, under our approach, the state would have to provide its proportion of the necessary costs to the local unit for these continuing activities (under the state-to-local formulation), but it would not have to fully fund them as "new" activities. If such legislation were to pass, and were perceived to be unfair, there would surely be, as Chief Justice Cavanagh suggested in his dissent in Schmidt, a political price to pay. 441 Mich 280. In short, this type of inequity is simply not addressed by § 29 and is left to the "democratic verdict of the voters." Id. Further, the dissent's invocation of the Legislature doing something "unthinkable" is not a new criticism. In fact, it can be seen in this country as early as Gibbons v Ogden, 22 US (9 Wheat) 1; 6 L Ed 23 (1824), where the fear of irresponsible legislation was urged as a reason for judicial action. United States Supreme Court Chief Justice John Marshall memorably dispatched this genre of argument:
The wisdom and the discretion of [the Legislature, its] identity with the people, and the influence which [legislators'] constituents possess at elections, are, in this, as in many other instances, as that, for example, of declaring war, the sole restraints on which they have relied, to secure them from its abuse. They are the restraints on which the people must often rely solely, in all representative governments. [Id. at 197.]
We also note that Justice Cavanagh's concern in this case with the "wide latitude" given to the state is inconsistent with his dissenting opinion in Schmidt. There, he noted that "it would simply be unreasonable to suppose that the Headlee Amendment was designed or intended to prohibit or forestall any conceivably unwise, unfair, or even evil state fiscal policy that might be imagined." Id. at 279. He also stated that he embraced the proposition that "to the extent the state is not governed by constitutional restraints, it is free to do whatever it wants to do, subject only to the democratic verdict of the voters." Id. at 280.
The Recorder's Court is a court unique to Detroit. It is "a court of limited jurisdiction and has jurisdiction for the prosecution of crimes committed within the City of Detroit only." People v Young (On Remand), 220 Mich App 420, 433; 559 NW2d 670 (1996). In every other county in Michigan, crimes committed within a city are prosecuted in tire circuit court.
We note that in determining "state law," the Durant Court considered the well-established tradition of local control over school operation. Durant, 424 Mich 385, n 14.
As noted above, the state funded a portion of judicial salaries in 1978 and fully funds judicial salaries under Act 374. Moreover, as discussed below, judicial salaries are not subject to a Headlee analysis.