State budget & taxes

Articles about state budget and tax policies, and how they affect school aid funding.

How much was that deficit again?

25 MarchNumbers, numbers, everywhere. Lots of numbers have been tossed around — $377 million deficit in the School Aid Fund, $220 per pupil reduction, and more — but when you look at the details these numbers don’t always seem to add up. Thanks to non-partisan staffers in Lansing (at the Senate and House Fiscal Agencies), information is available on the web that helps clear up some of the confusion, even if the underlying problems remain unchanged.

Budget negotiaions collapse; Senate rams through alternative

22 March — Negotiations among Democratic and Republican legislative leaders and the Governor broke down this afternoon after the two sides were unable to find common ground about new revenue or addressing both fiscal 2007 and fiscal 2008 at the same time. Shortly afterward, Gov. Granholm issued a new Executive Order that specified $344 million in cuts and savings from the General Fund portion of the budget. Republican lawmakers in the Senate made good on their promise to plug the budget hole without raising taxes. They finally went public with their list of additional cuts, pushing through legislation that cut a further $310 million from the General Fund budget and found reductions for the full amount of the School Aid Fund deficit – $377 million – while only cutting foundation allowances for schools by $57 million, or $34 per pupil.

Budget talks continue behind closed doors; income tax looked at

21 March — The top-level negotiations among the Granholm administration and Democratic and Republican legislative leaders continued today, but news was thin on the ground. Press reports indicate that the largest sticking point so far was the Republican caucus’ insistence that no revenue measures be considered for balancing the FY07 budget, and keeping the problem of the current fiscal year separate from plans for next year (fiscal 2008).

Tax notes

We’ll use this story to list some of the details behind the taxes which fund the state School Aid Fund. Having these kinds of facts available helps all citizens understand how the system works and the impact any changes would have. [Please be patient as we fill in the blanks.]

Contributors to the School Aid fund:
(excluding Federal funds)

Sales & Use Taxes
FY 2006 contribution: $5.29 billion, 48%

Budget talks begin in earnest

20 March — Leaders from both houses of the Legislature finally sat down to negotiate with the Governor over their competing plans for closing the current state budget deficit. House Speaker Andy Dillon (D-Redford Twp.) and Senate Majority Leader Mike Bishop (R-Rochester), along with other key lawmakers, met with Gov. Jennifer Granholm in private for several hours today. When they emerged from the meeting, they agreed that the talks had been “productive,” but all of them declined to provide any specifics.

More posturing than substance on budget

19 March — The posturing is well under way before the three-way budget negotiations begin.

Few facts available about budget talks

14 March — News reports from Lansing about the budget negotiations are bringing many hints but few hard facts. There are reports that House Speaker Andy Dillon (D-Redford Twp.) and Senate Majority Leader Mike Bishop (R-Rochester) are nearing agreement on a package of budget cuts and accounting changes that would plug the gap in the current fiscal year budget, including school aid, without new taxes. Reportedly, the package funds school foundation allowances as originally budgeted but includes cuts in “categorical spending” programs for schools.

Our letter to the Governor and Legislature

Below is the letter we sent to Governor Granholm and to our local representatives, Senator Liz Brater and Representative Rebekah Warren, on 16 March. If you would like to get involved and participate in our efforts, please send us a message at or use the “Join our email list” link to receive group news and web site updates. Or, feel free to borrow the letter and use it as a framework for your own letter to your elected representatives. Thanks!

Pensions and health care in the spotlight

12 March — Uncertainty continues to surround budget talks at the Capitol, but there are hints in news reports that some legislators may be inching towards attacking health care costs by making teachers state employees. [Update: press reports indicate that the bipartisan working group on the budget has unraveled, leaving the leaders of the two chambers to hammer out potential solutions.]

Negotiations begin

8 March — Lawmakers representing both parties from the House and Senate did meet yesterday and today to try and hammer out a budget compromise. The talks were cloaked in secrecy, but apparently involved more than just the six lawmakers named earlier; the Governor’s office was also represented, as was the Senate majority leader. The talks continue as the clock ticks on the school funding gap and the General Fund deficit.