Inside208

State Budget Signed By Governor

Posted on July 20, 2017 by Dene Westbrook

The Governor affixed his signature at the end of last week to the omnibus state budget bill.  This bill (HB 4323) includes a 2.5% ($6.2 million) increase to statutory revenue sharing. This spreadsheet from the House Fiscal Agency outlines the expected revenue sharing payments for each municipality based upon this increase.  These new dollars will flow strictly to communities that received a CVTRS payment in the current year and will be distributed to those units on a per capita basis.  Constitutional payments are expected to grow by approximately $40 million in the coming year, subject to actual state sales tax collections.

http://house.michigan.gov/hfa/PDF/Revenue_Forecast/CVT_Revenue_Sharing_Payments_FY16thruFY18_Conference_Report.pdf.

In addition to this welcome increase in revenue sharing, the budget also includes an increase above the Governor’s original proposal to fire protections grant funding of $1.4 million.  While not as high as the supplemental, one-time increase in the current year’s budget, this will be the second year in a row where fire protection grant funding has been higher than the baseline recommendation.  State PILT payments for purchased lands will also see a slight increase in this new budget.  The budget estimates $4 million in revenue coming in from the new medical marijuana law that will be distributed as grants to local units of government.  A new grant program has $500,000 available within Treasury that will provide reimbursements to local units that implement a financial data analytic tool.  Project Rising Tide will receive an additional $2 million to expand beyond the current 10 communities in that program.  The Michigan Enhancement Grant program will receive nearly $36 million to fund 20 projects in communities around the state.  Within the MDOT portion of the budget, an additional $49 million is anticipated being distributed from the MTF to cities and villages, along with additional revenue appropriated to transit and the TEDF.

From a broader level, the budget deposits another $150 million into the state’s Budget Stabilization Fund and $35 million into the Governor’s new Michigan Infrastructure Fund.

Supplemental budget language was added for the current (FY16-17) budget, as well. The Ambulance Quality Assurance Assessment Program (QAAP tax) was eliminated from the current year budget, but language allowing for its inclusion in the coming budget was retained, though it was amended in an attempt to tighten the revenue base upon which this new tax could be assessed.  Efforts will continue to keep DHHS from implementing this new tax and repealing the language in the Public Health Code.

New funding has been added to the current budget year aimed at providing reimbursement dollars for the under-development local Indigent Defense Commission standards to the tune of $5 million.  As these plans continue to be finalized within each county, the picture will become clearer as to how much more will need to be appropriated for full implementation of those plans.

New funding was also included in this supplemental section for the newly created Municipal Wetland Alliance for wetland mitigation banks ($3.9M) and for a Regional Infrastructure Asset Management Pilot ($2M), both of which could benefit communities around the state.

The Governor’s line item vetoes focused mainly on education or human services program additions and did not impact any of the items referenced above.  The new budget goes into effect on October 1, 2017.

Chris Hackbarth is the League’s director of state & federal affairs. He can be reached at 517-908-0304 and chackbarth@mml.org.

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