The Michigan Legislature completed work on the FY 2022-3 budget for the fiscal year starting on October 1. The combined appropriation including state departments, K-12 School Aid, Community Colleges and Universities will total over $75 billion. Even so, the Legislature decided to leave approximately $7 billion unspent. These dollars will be subject to future negotiations to take place in the ensuing months.
Overall, the budget passed last night represents moderate increases across nearly all departments. In cases where departments saw a reduction in revenue, it was due to the expiration of one-time appropriations in the current year budget. The budget also saw a substantial commitment to reducing pension liabilities, a move that will save state and local governments billions over the next decades.
The Legislature will now enter its summer recess period, and lawmakers who are running for reelection will spend the next two months campaigning in their districts. The Legislature will return to full session in September.
The Michigan Legislature has passed both House and Senate responses to the Governor’s budget proposal, and the final negotiations on the FY 2022-23 appropriations bills are expected to take place over the next four to six weeks. The pending Consensus Revenue Estimating Conference is taking place on May 21, and it is expected to show another increase in revenue estimates. Just how large an impact this will have on state spending is yet to be determined, but the new numbers will certainly factor into ongoing budget negotiations. Indeed, it has already sparked new proposals from the Governor and the Legislature on how to spend this surplus.
Legislation making changes to rules for retired MPSERS members who return to work has also seen action in the House and Senate. The bills would remove many of the myriad criteria that MPSERS retirants must meet in order to come back to work in a school setting while continuing to receive pension benefits. More on these and other issues below.
The Michigan Legislature has returned from the winter break and (despite a few COVID-related delays in the Michigan House) are back in full session. Governor Whitmer’s State of the State Address and her subsequent budget recommendation laid out her goals for the upcoming year and the next fiscal year. Highlights of her proposals include the elimination of the so-called “retirement tax” as well as increases in the Earned Income Tax Credit, credits for electric vehicles, and large increases in mental health funding.
Republican leaders in the Michigan House and Senate, meanwhile, have focused on legislation that would reduce Michigan’s Income Tax rate from 4.25% to 3.9%. They have also targeted COVID-relief funds to shore up the Unemployment Insurance Trust Fund and provide grants to small businesses who have been hardest hit by the pandemic. Whether or not the two branches of government will be able to find agreement on any of these competing proposals (even at a time when Michigan revenues are sky-high) remains to be seen. It is, after all, an election year.
More on these issues and others below.
The first year of the 2021-2 Michigan Legislative Session has come to a close, and the House and Senate went out with a bang. On the last session day of the year, the Legislature sent Governor Whitmer a large package of economic development bills aimed at attracting and retaining large business operations in Michigan. They also passed a series of budget supplemental bills that use a portion of the remaining federal COVID-relief dollars combined with surplus state funds to distribute money to a variety of state and local projects.
Speaking of COVID-19, although cases and hospitalization numbers stemming from the pandemic remain high, the loudest rhetoric in Lansing continues to come from individuals opposed to mandatory masking and vaccinations. While public health leaders continue to urge individuals to get vaccinated (and the majority of Michiganders have done so), and despite the fact that vaccine requirements remain popular with the general public, legislative leaders in Lansing continue to give deference to the vocal minority who decry vaccination. Michigan remains on the low-end of vaccination rates in the US, which could very well be driving our high hospitalization rates.
More on these issues and others below.
The Michigan Legislature has completed its work on the FY 21-22 state budget, and not a moment too soon. The October 1 deadline is fast approaching, but on September 22 the House and Senate agreed on omnibus budget bills to fund state government, local revenue sharing and higher education for the upcoming fiscal year. The Governor has announced her support for the plan, although there still may be a few line-item vetoes before she signs the bills into law.
The Legislature and Governor also continue to spar over COVID-19 policies. The question around mask and vaccination mandates continues to dominate many discussions in Lansing and it has now spilled down to local government and school board levels. Although COVID-19 infections and hospitalizations in Michigan are not yet at the level currently being seen in the southern US, there has been a spike of new cases in children since schools opened in late August. This has prompted vicious debates at school board and county commission meetings sometimes ending with threats of violence. The Legislature has weighed into the fray by including language in the budget bills that seek to neuter vaccine and mask mandates, and prohibit “vaccine passports” in all departments. They are also currently moving separate legislation that would ban vaccine and mask mandates altogether. That budget boilerplate language and the separate legislation is expected to be vetoed by Governor Whitmer.
A more detailed breakdown of key budget decisions is below.
Governor Whitmer lifted COVID-19 restrictions for all locations other than health care facilities on June 22. While there are still concerns about the growing spread of the Delta-variant which is more contagious and possibly more damaging to health, for the time being at least things are returning to normal in Michigan. Many state workers who have been working from home will begin to return to in-person work on July 12. However, many departments will be phasing in the return to work plans with some workers not expected to be back to in-person work until September.
In Lansing, the Michigan Legislature continues to work on the Fiscal Year 2022 budget that would begin on October 1, 2021. With the July 1 self-imposed deadline to pass a budget rapidly approaching, the House and Senate have scheduled June 30 for one last session day to complete the work. Discussions on the over $6 billion in federal funds the State of Michigan received from the American Rescue Plan Act have also been ongoing. It is likely that work on allocating those federal dollars will continue over the summer.
More on these issues below.
As the roll-out of COVID-19 vaccines continues, Governor Whitmer announced last week that pandemic restrictions will be lifted based on percentages of Michiganders who have been fully vaccinated. The plan, dubbed “Vacc to Normal,” will gradually eliminate limitations on gatherings, in-person work, mask usage and other restrictions based on milestones of vaccine distribution. This is the first indication that there is hopefully light at the end of the tunnel, though it comes at a time when much of Michigan is experiencing another wave of infection.
The Michigan Legislature is devoting most of its attention to the 2022 budget process, while at the same time preparing to pass supplemental bills for the current year that would appropriate federal COVID-relief funds. Over $1 billion in relief funds passed in Washington last December remain unspent, and that is in addition to the over $5 billion the state received recently as part of the American Rescue Plan federal legislation. Michigan lawmakers find themselves in a strange position of having to distribute huge amounts of one-time federal funds while at the same time having to balance long-term projections for state revenues.
More on these issues below.
Whenever you have the Legislative and Executive Branches of government controlled by different political parties, some acrimony is expected. There is always tension and competition to win not only favored policies, but also to win the public relations battle. However, a solid year of pandemic restrictions have raised the temperature to unprecedented levels in Lansing. The Legislature has already been victorious in one lawsuit against Governor Whitmer, and it is possible that another may be coming soon to a courtroom near you.
The last month has seen a budget agreement reached between Governor Whitmer and the Michigan Legislature, the Michigan Supreme Court ruling that the law upon which the Governor based her emergency powers was unconstitutional, and a frantic effort to reinstate certain Executive Orders that protected things ranging from unemployment benefits to the ability of public bodies to meet remotely. It is a lot to process.
Although the Legislature has a handful of session days scheduled between now and the election, it is widely presumed that little legislating will take place in the days leading up to the election. The “Lame Duck” session, in which many lawmakers who will be leaving office on December 31 still have a chance to make laws, will begin soon after the election and run through mid-December.
More on these issues below.
The Michigan Legislature, after making alterations to the current year budget to close holes created by the global pandemic, is now working to present next year’s budget to Governor Whitmer by the September 30 deadline. The traditional budget process has been almost completely derailed this year as the COVID-19 virus has not only wreaked havoc on the economy, but has also made the normal conduct of legislative business much more difficult. After last year’s debate over road funding that nearly led to a government shutdown, we had hoped for a more orderly process in 2020. Obviously, 2020 had other ideas.
More on the budget process and other issues affecting state workers is below.
The Michigan Legislature worked through the last two weeks in July, and plans to be in session for at least parts of August. They completed work on a deal to balance the current year budget, and are now working toward preparing the FY 20-21 budget. They also passed legislation that would provide immunity from liability for health centers and nursing homes for any negligence related to the COVID-19 pandemic, and will likely be working to extend that immunity to all businesses with another round of legislation in August. The Civil Service Commission also adopted a rule with the sole goal of undermining state employee unions. More on these issues below.
The Michigan Legislature has gone into a mini-recess that will last for most of the month of July. Before they left Lansing, they passed a supplemental budget bill that will spend approximately $800 million in federal funds the state received from the CARES Act on a variety of COVID-19 related programs. They did not, however, address the shortfall in the current year budget (although an agreement in principle has been reached on that), nor did they present a budget for FY 21 to the Governor. Those issues will have to be addressed in July, August and perhaps even September.
The COVID-19 pandemic has created the greatest crisis Michigan has faced in recent memory. The Consensus Revenue Estimating Conference taking place on May 15 is expected to show that Michigan’s revenues are down anywhere from $1 billion to $3 billion in the current fiscal year. Losses from the shutdown of most commercial activity will have a devastating impact on the state’s General Fund and School Aid Fund. It is expected that Governor Whitmer will issue a series of executive order budget cuts in the coming weeks.
While the Governor’s Stay Home, Stay Safe order has been extended to May 28, the reduction in the spread of the virus has led for a call to reopen Michigan’s economy. Some sectors, like construction, have already reopened, and some industrial and commercial businesses are expected to be allowed to reopen soon. However, Legislative leaders from the Republican majorities are claiming that the reopening should move faster since the economic impact of the shutdown is proving to be devastating not only on state revenues but also on a huge number of individual Michiganders.
See below for more information on these issues, and more.
Michigan policy makers are 100% focused on the Coronavirus pandemic, as officials are scrambling to deal with the rapid spread of the disease. Governor Whitmer has issued multiple executive orders ranging from school closures, prohibitions on price gouging, restrictions on public gatherings, and – most recently – a Stay Home, Stay Safe order requiring all Michigan residents to shelter at home unless they are “essential employees” or are obtaining personal needs like food, supplies, medication or medical treatment. The Michigan Legislature responded last week with a $75 million response package aimed at increasing Michigan’s preparedness for the impact of the increasing spread of the illness.
We are now halfway through the 2019-2020 Michigan legislative session, and if the first year was anything to go by, year two could be a tumultuous one. Last year began with Governor Whitmer calling for a $.45 per gallon fuel tax increase to fully fund road repair and construction. It ended with a budget standoff, an unprecedented use of the line-item veto pen, and a final compromise budget that restored much if not all of the nearly billion dollars in cuts and transfers made by Governor Whitmer. While there were moments of bipartisan collegiality (e.g. no-fault auto insurance reform), much of the year was marked by fighting words.
We enter 2020 with the relationship between the Governor’s office and the Legislature on shaky ground. This is understandable, since the Legislature is controlled by Republicans and the Governor is a Democrat. It will be interesting to watch as we begin the 2020-2021 budget process in February how the two branches will interact. The Governor will present her State of the State Address on Wednesday January 29, and she will present her 2020-2021 Fiscal Year budget proposal on February 6.
For the last eight years, the Michigan Legislature has been able to finish the upcoming fiscal year budget by June or July. However, for the first time in 8 years we have split partisan power between the Legislature and the Governor. Therefore, House and Senate leaders have decided to hold off before presenting a budget to Governor Whitmer. The deadline for having a budget in place is the beginning of the next fiscal year: October 1, 2019. Because it seems likely that a budgetary showdown will occur between the Legislature and the Governor this year, it is possible that Legislative leaders feel that their hand is strengthened by delaying completion of the budget for as long as possible.
In other news, the debate over the future of the Caro Psychiatric Hospital continues; the Attorney General dismissed legal actions against state employees over the Flint water crisis (although future action is expected); and the Marijuana Regulatory Agency in the Department of Licensing and Regulatory Affairs is preparing to expand its staff in preparation for implementation of recreational marijuana laws passed on the ballot last November. More on these stories below.
The House and Senate have nearly completed their work on their first drafts of the 2020 state budget. They have both decided to scrap Governor Whitmer’s call to increase the gas tax by $.45 per gallon. Instead, they have attempted to reduce General Fund spending across most departments in order to free up more funds to dedicate to road and bridge repair and maintenance. Governor Whitmer has pledged to veto any budget that fails to provide at least $2 billion in new transportation funding, and it is looking more and more like she will be forced to either make good on that threat or back down.
Also this month, the Legislature passed legislation making sweeping changes to Michigan’s Auto No-Fault Insurance laws, and the House is reviewing changes to state and school employee retirement benefits. More on these issues below.
It’s been a tumultuous two months since the Governor and Legislature settled on a 2020 budget about which no one is happy. The past six weeks have provided little clarity on how the Legislature and Governor will work together moving forward. After the Legislature’s presentation of a finalized budget a mere three days before the end of the fiscal year, and the Governor’s unprecedented use of the line-item veto and administrative board powers, trust is presently a rare commodity in Lansing. Governor Whitmer and Legislative leaders have both proposed their own supplemental budgets that would restore the bulk of the nearly $1 billion that was line-item vetoed on September 30, and there is even some overlap in the proposals. However, with over a month gone by to allow dust to settle, the two sides seem no closer to a compromise agreement on restoring the cuts, let alone on a plan for future road funding.
After a hard-fought election, the next governor of Michigan will be Democrat Gretchen Whitmer. While Democrats made gains in both the House and Senate, Republicans kept their majorities in both chambers. The Legislature is returning to Lansing for the “Lame Duck” session that could include several attempts to make more changes to various pension laws. We may also face attacks on public employee collective bargaining rights as the Republican leaders see the next few weeks as their last chance before a new Democratic administration takes over.
Budget Vetoes Roil Lansing
The Legislature and Governor Whitmer managed to complete the 2020 budget process and avoid a government shutdown. That is about the most positive thing that can be said about this year’s appropriations process. At the end of September, the people of Michigan witnessed a budget battle that went down to the very last minute, produced a record number of line-item vetoes, saw the unprecedented use of executive power to shift funds from one line to another, and that left over $500 million in General Fund dollars on the table. It also concluded with no deal on long-term road and infrastructure funding.
The Michigan House and Senate are returning this week from their summer recess. They have just over a month to reach a budget agreement with Governor Whitmer in order to avoid a government shutdown. The Governor has already announced her desire to have a “Plan B” that would keep the government open even if she and the Legislature cannot reach an agreement on the budget and on road funding by September 30. The next few weeks will tell whether such a plan is needed.
The focus of the Legislature continues to be squarely on the 2020 budget – and just as importantly – whether a significant increase for transportation funding will be included. While the roads are getting 90% of the legislative and media attention, several other questions will also be answered in the next month’s budget debate. These include the future of the Caro Center Psychiatric Hospital, whether the School Aid Fund will continue to be used to pay for higher education, and how deeply some departments may be cut in order to pay to “fix the damn roads.”
More on these issues below.
The Legislature will return next week from their Spring Recess, and the outlook for next year’s budget discussions is as cloudy as ever. Governor Whitmer’s budget proposal hinges on a $.45 per gallon gas tax increase. While there was little immediate reaction from the Republican-controlled Legislature, their messaging has been slowly coalescing into what could be a complete rejection of that proposal. Without those funds, the Governor’s proposal falls apart. Lansing is eagerly awaiting to see what the Legislature’s alternative might be.
The first month of a new legislative session is coming to a close, and it has been a whirlwind of meeting new legislators, perusing committee assignments, and re-acquainting ourselves with policy makers in new positions. Moreover, the changeover from the Snyder Administration to the Whitmer Administration is moving along slowly but steadily as her cabinet and key staffers have been announced on a piecemeal basis. One of the last department heads to be named was Robert Gordon, the new DHHS Director. Mr. Gordon previously was a member of the Obama Administration where he served as the acting deputy director at the U.S. Office of Management and Budget and also as the acting assistant secretary for Planning, Evaluation, and Policy Development at the U.S. Department of Education.
The Governor presented her State of the State address on February 12 in which she made several positive remarks about state workers and their value to Michigan. Her budget presentation will take place in early March, and it will be there where she lays out more detailed specifics about her policy goals.
At the end of every two year legislative session, there is a period after the election results are tallied, but before the new elected officials are sworn into office. This period is known as the Lame Duck session, since it allows recently defeated or term-limited lawmakers to set policy for approximately six weeks. This year, the election results changed the power structure in Lansing starting January 1, and the individuals currently in office took extraordinary steps to cling to that power.
The sheer volume of legislation passed by the Michigan House and Senate over the past month has dwarfed all recent Lame Duck sessions. In fact, the Legislature passed more bills in the last four weeks of session than they had in the previous two years. The pace was so rapid that the House and Senate often worked well into the early morning hours voting on one bill after another. The Legislature finally adjourned on Friday, December 21 at approximately 8am.
Since then, Governor-elect Whitmer has made an increasing number of announcements about her new cabinet choices. She has also stated her intent to keep the Department of Health and Human Services intact, addressing rumors that she might decide to split it again into two separate departments. More on these issues and others below.
The Michigan Legislature is halfway through the 2013-2014 session. On some fronts, issues remain in flux. The recent changes to the Michigan Court of Claims will have an as yet undetermined impact on litigation over payroll deductions for state employees' pensions.
The Michigan Court of Claims was established in the State Constitution to hear cases against the State of Michigan. Lawsuits seeking monetary compensation are referred to the Court of Claims, which processes them.
The Legislature wrapped up their summer recess with a two day session last week. They will not be in session again until October, and even that is expected to be abbreviated. The focus is completely on the November election right now, and with it shaping up to be one of the more competitive elections in recent years, legislators are spending all of their time on the campaign trail.
The Legislature has wrapped up the Fiscal Year 2018-19 appropriations process and has recessed for the summer. Before they left, they passed a large package of bills dealing with sexual assault in response to the events at Michigan State University.
The Michigan Legislature is back in session after the two-week spring recess. Over the last month, House and Senate Appropriation Subcommittees have been holding hearings to review Governor Snyder’s budget proposal.
The Michigan Legislature is in the middle of a two-week spring recess. Over the last month, House and Senate Appropriation Subcommittees have been holding hearings to review Governor Snyder’s budget proposal. We are approximately half-way through the budget process and most subcommittees are preparing their initial reports for their individual departmental spending numbers.
State Budget Finalized by the Legislature.
Both the House and Senate have approved an Omnibus budget bill for state agencies. Some agencies' budgets of interest include:
The Department of Human Services: The budget cuts $133,014,700 from the agency's FY 2011-12 gross appropriation, making the FY 2012-13 DHS budget $6,553,832,200.
Corrections: The Department of Corrections FY 2012-13 appropriation is $2,000,915,900; $13,583,500 less than FY 2011-12.
The Department of Community Health: DCH will see a $358,240,700 increase to $15,034,057,700 in the upcoming fiscal year.
Department of Transportation: A provision in MDOT's budget will now require all new contract and subcontract employees for the agency to go through the e-Verify system to check the immigration status of their employees. MDOT employees were not included in this provision under the budget language.
The Legislature has returned from after the holiday recess and will soon turn much of its attention to the budget process. Governor Snyder gave his last State of the State address on January 23, and his final budget presentation will take place on February 7.
As 2017 comes to a close, we are halfway through the current two-year legislative session. The Michigan House and Senate have adjourned for the remainder of the year and will return to session on January 10. Before they left, they completed work on a package of bills aimed at making reforms to the state’s unemployment insurance system, said farewell to Representative Andy Schor who will step down to become the new Mayor of Lansing, and passed legislation creating an early warning system of sorts for municipal pension systems.
The Michigan Legislature spent much of the last two months working on reforms to Michigan’s No-Fault Auto Insurance law. While there is near universal agreement that Michiganders (and we are officially “Michiganders” now thanks to Senate Bill 562) are paying too much for auto insurance, there is a massive debate on how to solve that problem.
Although the Legislature has been on summer break since June, that does not mean that nothing is happening in Lansing. Plenty of officials and legislators are planning rule changes or legislation that will begin moving in the fall.
The budget impasse between the Legislature and the Governor regarding the future of the school pension system continues into June. State prisons would see a $10 million cut to their operations under the 2017-18 fiscal year budget approved today by a House-Senate conference committee.
The last month has been a whirlwind of conflicting budget numbers and proposals between the House, Senate and Governor Snyder. Complicating the annual appropriations process has been the agreement between Speaker of the House Tom Leonard and Senate Majority Leader Arlen Meekhof that the greatest threat to Michigan at this moment are public school pensions.
The Michigan Legislature is in the middle of its summer recess, but most legislators and staff have shifted into campaign mode. Every seat in the Michigan House is up for election this year, though the Michigan Senate members will not appear on the ballot until 2018.
Most of the budgets winning approval Tuesday from House-Senate conference committees sailed through with no opposition, but the move to close one of the three state-run juvenile facilities in the Department of Human Services' budget prompted strong Democratic opposition.
A major disagreement has developed on the Department of Corrections budget with the chief senator on the topic backing a 2016-17 fiscal year budget proposal that would close two prisons and call for the department to lease and operate a privately owned prison in Baldwin.
Today the House Workforce and Talent Committee reported out legislation that would seriously undermine Michigan's decades old Civil Service system. Civil Service was established in the Michigan Constitution as a bar to politically motivated employment practices in state government.
The election is upon us and it is one of the strangest our nation has ever had. Rarely have there been two presidential contenders that were so unpopular. Donald Trump’s highly unorthodox campaign could still bear fruit on November 8, but the latest polls show him a longshot to defeat Hillary Clinton. In Michigan, Clinton is up by anywhere from 5-8 points in the polls, but it is still hard to say how that will affect down-ballot races, if at all.
The 99th Michigan Legislature was seated in Lansing this month. The term begins with a new Speaker, Representative Tom Leonard (R-DeWitt) in the Chair, but the same Republican/Democrat split of 63-47. It is widely believed that the Republican caucus has become more politically conservative as a result of the election, but that has yet to be seen.
The Legislature has completed work on the 2016 budget and is preparing for a few months of “district work” during which time the House and Senate will be on their summer recess. Although the Senate will return next week for a short session, and the House is due to return for one day in July, most observers do not expect much legislative action before fall.
The Legislature just embarked on their two week Spring Recess, also called the In-District Work Period. They will return on April 12 to continue work on the budget, Detroit Public School reforms, and other pressing issues. Fallout regarding the Flint Water Crisis continues to dominate the agenda, and there will likely be more discussions regarding assistance to Flint residents through the spring.
The Primary Election is over, and due to the nature of Michigan’s legislative districts, that means that about 80% of Michigan House Seats have essentially been decided due to the fact that most seats are skewed toward one party or the other.
Budget cuts and a major departmental overhaul topped the headlines in Lansing this month. In January, the House Fiscal Agency discovered a major shortfall in the current year budget, forcing over $300 million in cuts and transfers to bring the budget back into balance.