Inside208

Whitmer Administration Pitches FY21 Budget Proposal

Posted on February 7, 2020 by Dene Westbrook

In addition to the League’s official media statement in response to the Governor’s budget presentation yesterday, here are some of the more critical details for League member communities:

The Governor’s Fiscal Year 2020-21 budget utilizes $11 billion in General Fund dollars, just barely higher than the $10.7 billion spent in the 2000 state budget.  Overall this budget proposal would spend nearly $62 billion from all sources, up almost 4% from the current budget year.  With limited new revenue to spend and the ongoing debate over road funding, the Governor focused most of her new programming proposals on the K12 education budget and talent/job training programs.

Constitutional Revenue Sharing payments are estimated to increase by 1.9% ($16.4M) over current year directly tied to expected sales tax revenue growth.  These dollars are distributed to all CVTs on a straight per capita basis.

Statutory Revenue Sharing payments are proposed to increase by 2.5% ($6.5M).  These dollars would flow in direct proportion to what eligible CVTs received in this current budget.

A new grant program that would allocate $40M in one-time dollars for planning and infrastructure improvements that would address municipal impacts from climate and high-water erosion concerns ($10M for local government planning and $30M for infrastructure projects).  Planning grants will be limited to a $200,000 maximum per award and infrastructure grants limited to no more than $2.5M per award.  A 20% local match will be required.

A new Rapid Environmental Contamination Response program is being proposed that would be funded with $20M to deal with initial abatement activities at contaminated properties.

While the MDOT budget proposal does not reflect any of the revenue related to the Governor’s proposed $3.5B bonding proposal for state trunkline roads, it does include about $200M more than the current year budget, with $132M of that amount coming from the final phase of the General Fund earmark diversion from the 2015 road funding package and nearly $50M in expected increased federal highway revenues.  Transit and rail programs are also proposed to receive an additional $30M under the Governor’s budget proposal.

The Community Revitalization and Business Attraction program at MEDC would see their line item returned to prior year funding levels ($100M) following the current year’s $20+M reduction.

An additional $36.5M is recommended to continue funding local court system costs for indigent defense commission standard requirements.

The budget proposal also calls for a supplemental/current year appropriation of $14M to fund local clerk expenses related to the upcoming March Presidential Primary election.

Copies of the Governor’s Executive Budget Proposal can be downloaded here.  Specific proposal briefing papers and copies of the proposed budget bills can be viewed on the State Budget Office webpage here.

Now that the Governor’s budget has been presented, the House and Senate Appropriations committees will begin their review of the overall budget and each individual department starting next week.  The Senate General Government budget subcommittee is already scheduled to begin reviewing the budget that houses revenue sharing on February 12th.  Legislative review and deliberation will occur through the spring break period, with the May Consensus Revenue Estimating Conference serving as the final benchmark in the process before legislative leaders and the Governor sit down to hammer out final details in an effort to complete the budget prior to the new July 1st deadline.

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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