- Michigan: Governor’s $54.9 Billion Budget Proposal Includes Sizeable Funding to Address the Water Crisis
- February 26, 2016 | Authors: Chad Arfons; David M. Kall; Susan Millradt McGlone
- Law Firm: McDonald Hopkins LLC - Cleveland Office
- A Feb. 10, 2016 press release summarizing Gov. Rick Snyder’s fiscal year 2017 budget proposal, submitted last week, reveals that he is seeking a substantial supplemental request for the current fiscal year to help Flint get out from under the lead-in-the-water problem. Included is $30 million for relief of Flint water bill payments, $25 million for Flint-specific infrastructure needs, and $165 million set-aside for statewide infrastructure needs in the newly created Michigan Infrastructure Fund. Overall, the $54.9 billion proposal is relatively flat compared to the previous one, containing a small, 0.8 percent increase over last year. The new fiscal year begins on Oct. 1, 2016.
The other critical component of the budget proposal is Detroit public school funding, in the amount of $72 million per year for the next 10 years. This would come from Michigan’s tobacco settlement proceeds, and would offset the Detroit Public Schools’ repayment of a debt load expected to grow to $515 million by this summer. As with the water crisis, there is a supplemental request, of $50 million, to make sure that the system remains solvent while lawmakers negotiate a long-term solution.
Beyond these, Gov. Snyder’s recommended budget includes funding for the following:
1. Education - Key components include:
- An additional $150 million for the K-12 foundation allowance, bringing total K-12 appropriations to $12.1 billion.
- An additional $61.2 million for the operations of Michigan’s 15 public universities and an additional $7.5 million for community college operations. The university funding is contingent on limiting tuition increases to 4.8 percent or less.
- $3.4 billion in federal funds for the Healthy Michigan Plan to continue expanded Medicaid coverage for more than 600,000 Michigan residents.
- $91.5 million to treat nearly 7,000 patients living with hepatitis C.
- $43.7 million to treat approximately 320 children with cystic fibrosis.
- $115.5 million to bolster Michigan’s economy through business attraction and community revitalization efforts.
- $35.6 million to match employers’ talent needs with skilled workers for in-demand jobs, which incorporates a $10 million increase to the skilled trades training program.
- $533.3 million in new dedicated transportation revenue, including $189.2 million for the state trunkline fund, which is used for highway construction and maintenance, and to record loans made to local units of government for reconstructing and resurfacing roadways; $283 million for local road agencies; and $61.4 million for rail and public transit, for maintenance and improvement of transportation infrastructure across the state.
- $132.8 million in new technology investments, including additional funding for cyber-security to protect critical data from growing threats, and added investment in the Information Technology Investment Fund to improve technology service and efficiency.
- $57.5 million in new federal funds from the Fixing America’s Surface Transportation Act, to be used for local road, state trunkline, and transit projects.
- An additional $9.5 million to run a trooper recruit school with the goal of producing another 85 graduates.
- $8.5 million to run an academy to train and graduate 350 new corrections officers for prisons across the state.
- $2.2 million to enhance the capacity to combat the increasing growth of digital crime.
- $1.5 million to expand the Secure Cities effort in certain communities (Benton Harbor, Hamtramck, Harper Woods, Highland Park, Inkster and Muskegon Heights). The program has already produced impressive results by reducing violent crime in Detroit, Flint, Pontiac and Saginaw.
- $500,000 to help prevent sexual assaults on college campuses.
- $781.5 million, based on estimated sales tax collections, for constitutional revenue sharing payments for cities, villages, and townships, which represents a 3.9 percent increase.
- $215.2 million for eligible communities, conditioned upon meeting certain transparency requirements.
- $11 million in grant assistance to encourage communities, by way of defraying expenses, to combine operations.
- Recommended $1 billion for the school employee retirement system in k-12 schools, or $660 per student.
- Rainy Day funding is projected to be flat at $611 million, but up from just $2.2 million when Governor Snyder took office on January 1, 2011.
- $74.9 million in ongoing funds for the community college system, a recommended increase of $3.7 million, for costs above the Michigan Public School Employees Retirement System (MPSERS) rate cap.
- $5.9 million in ongoing funds for higher education, an increase of $730,000, for the seven participating universities in the MPSERS.