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League Highlights Potential Negative Impact of Using General Fund Revenue for Roads

Posted on July 17, 2015 by Dene Westbrook

Although the Legislature made little progress this week in finding a solution to fix Michigan’s infrastructure needs, the League was very active in expressing our opposition to significant cuts to the General Fund.

On Monday we delivered a letter signed by the League and eight other organizations (Michigan Fraternal Order of Police, Michigan Association of Counties, Michigan Association of Police Organizations, Michigan League for Public Policy, Michigan Professional Fire Fighters Union, Michigan Townships Association, Police Officers Association of Michigan and Presidents Council, State Universities of Michigan) to all 110 members of the House expressing our serious concerns with using existing General Fund resources to improve Michigan’s infrastructure. A copy of the letter can be found at the following link. Final GF Concern Letter to Legislators

In addition to the letter the League requested much respected non-partisan former House Fiscal Agency Director Mitch Bean to look at the implications of SB 414.

Key findings in Bean’s report:

  • The state’s General Fund has declined 1.8 percent since FY 2001, and adjusted for inflation has declined 23 percent. No state in the nation has cut its budget more than Michigan over that period.
  • The state already faces revenue pressure from several tax changes scheduled to take effect in FY 2017-18, when SB 414 would take full effect.
  • Additional general fund spending pressures are also expected, given federal policy changes that will require more state support for basic human services.
  • If SB 414, as passed by the Senate becomes law, the likely impact on the FY 2017-18 General Fund (GF/GP) budget would be $450 million to $550 million in GF/GP budget cuts.
  • The state would have to cut between 11 percent and 13 percent from each department line item if they were able to reduce health and human services, and corrections spending, the two largest items in the GF budget, by a combined $100 million.

The report and a memo from the League was provided to every Legislator, the Governor, and the Capital Press Core. A copy of the memo and report can be found at the following link. Report for Legislators

The League will continue to work hard to ensure our voice is heard on the potential long-term negative impacts this proposal could have on our communities. We will continue to update you on the advancement of this proposal and how you can engage members of the Legislature in the coming weeks.

John LaMacchia is a Legislative Associate for the League handling transportation, infrastructure, and energy issues. He can be reached at jlamacchia@mml.org or 517-908-0303.

 

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