Legislature Breaks Without Finishing GF Budget

Posted on July 2, 2021 by Dene Westbrook

The Legislature recessed for at least two weeks earlier this week without finalizing a General Fund budget and without allocating any of their remaining GF fund balance or available American Rescue Plan Act funds.  A school aid budget was completed and sent to the Governor in HB 4411, but the House’s attempt at a baseline/continuation budget in HB 4410 and the Senate’s response that simply funded revenue sharing and a couple of DHHS line items remained unresolved by the time each chamber had adjourned.

While revenue sharing was not completed before they recessed, both chambers provided a 2% statutory revenue sharing increase ($5.2 million) in their different versions.  The Senate proposal also included a League-requested $433,000 to restore the August 2020 revenue sharing cut for dozens of League members that were unable to utilize the federal CARES funding that was offered as a replacement for that cut.  The Senate proposal and a different House proposal in SB 27 also offered a $10 million appropriation to provide relief to communities impacted by the severe storms that occurred in June.

While not completed this week, these items are all expected to resurface in a full budget negotiation that is expected to proceed between the Administration and legislative leaders in the coming weeks.  Those negotiations will likely determine when the House and Senate return to action to vote on a budget deal.  At this time, the House and Senate are scheduled to return for session days on; July 14 in the House, July 15 in the House and Senate, July 21 in the House, and July 27 in the Senate. While these days are currently scheduled, the success of ongoing budget negotiations will likely determine which, if any, of these days are utilized.

The League continues to advocate for improvements in revenue sharing funding, support for municipal infrastructure repairs necessitated by shoreline erosion, substantial state investments in water and sewer infrastructure similar to the Governor’s MI Clean Water Plan and the Senate proposal in SB 565, and state funding for replacement of local bridges as proposed in different versions by the Governor and legislative leaders, among a host of other spending priorities.

In addition to their work on the various Departmental budgets, the Governor and Legislature are also debating priorities for allocating the state’s first ARP allocation of $3.25 billion.  The League and our partners are pressing for leaders to agree on a comprehensive spending plan for these dollars that will provide local governments with additional opportunities to invest in their communities and leverage the dollars that they have available for greater impact on infrastructure, building local capacity, improving housing and community development, and promoting local economic development efforts.

Chris Hackbarth is the League’s director of state & federal affairs. He can be reached at 517-908-0304 and [email protected].


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