Michigan Senate gives final approval to $56.7 billion budget

Posted at 6:31 PM, Jun 22, 2017
and last updated 2017-06-22 18:31:23-04

LANSING, Mich. (AP) — The Michigan Senate gave final approval Thursday to a $56.7 billion state budget that includes a big increase in funding for at-risk students, capping a four-month process that had been held up a bit by Republicans’ push for teacher retirement changes.

The spending plan sent to Gov. Rick Snyder includes $48 million more for Flint’s water crisis, bringing the total state commitment to nearly $300 million since the man-made disaster was discovered less than two years ago.

Overall spending would rise by at least $1.2 billion, or more than 2 percent, in the fiscal year that starts in October.

“We were able to increase spending in several key areas while making commonsense reductions in others and kept our overall spending in check,” said Senate Appropriations Committee Chairman Dave Hildenbrand, a Lowell Republican.

The two budget bills passed 26-11 and 23-14 in the GOP-controlled chamber, with Democrats and some Republicans opposed. The plan also includes an additional $110 million in spending for the current budget year.

Sen. Curtis Hertel Jr., an East Lansing Democrat, said the spending measure is “much better” than a version approved in May but is still flawed. He specifically opposed spending $255 million to address liabilities in the Michigan Public School Employees Retirement System and to steer newly hired school workers into a 401(k)-only benefit instead of one that includes a pension.

The budget deal was finalized once GOP legislative leaders and Snyder agreed to the school retiree changes that soon will go the Republican governor’s desk.

“We are spending $255 million of the people’s money to solve a problem that doesn’t need to be solved, taking money to close the teacher retirement system or set it up for failure. I oppose that,” Hertel said. “I believe that money should have been spent on roads. We still have crumbling infrastructure out there.”

Some major components of the 2017-18 budget include:

— a $120 million increase in spending on economically disadvantaged students, nearly a third more. Some 87,000 new children would become eligible.

— base per-pupil funding increases ranging from $60 to $120, or 0.7 to 1.6 percent. Lowest-funded districts would get more, while higher-funded ones would get a lesser boost. Districts would receive another $25 for each high school student, to reflect that it costs more to educate ninth- to 12th-graders than younger children.

— increased funding ranging from 1.6 percent to 2.7 percent at 15 state universities. State operations aid for the University of Michigan-Ann Arbor, Michigan State, Wayne State, Western Michigan and Eastern Michigan would remain below what it was seven years ago before a big cut.

— a $150 million deposit into savings, less than a $260 million-plus deposit that was initially planned by Snyder.

— a slight cut to the $2 billion Department of Corrections budget, including a $6.5 million reduction to close housing units at five prisons. It is a far lower cut than was proposed initially by the Senate.

— a $7.8 million, or 1.5 percent, cut to the Department of Environmental Quality. Legislators rejected Snyder’s request to shift nearly $15 million to offset the loss of environmental cleanup dollars that have dried up nearly 20 years after voters OK’d a ballot measure. Lawmakers agreed to spend $300,000 more to address vapor intrusion, which occurs when poisonous gases enter residences and buildings where contamination was not cleaned up. Snyder had wanted $1.3 million more.

The Michigan League for Public Policy, an advocacy group for the poor, cited “great wins” in the budget but echoed Democrats’ concerns that it would save general funds by shifting millions from the Unemployment Insurance Contingent Fund. It has penalties and interest from people who collect too much in benefits, including thousands who were wrongly blamed for overpayments by an automated computer system.

“This money does not belong to the state, it belongs to the honest residents who were incorrectly assessed exorbitant fines and penalties,” said League President and CEO Gilda Jacobs.

But Senate Majority Leader Arlan Meekhof, a West Olive Republican, said if “somebody’s been wronged and money has to go back to them, we’ll figure out a way to get that.”

Lawsuits are pending.