MD

News

Saturday, May 26, 2012

Advertise with us »

Senate OKs plan to keep 'U' funds flat

Published September 23, 2007

LANSING (AP) - State spending on K-12 public schools and universities would stay flat, some state workers would lose their jobs and funding for prisons and other state programs would be cut under a plan approved last night by the Republican-led Senate.

The proposal, which passed entirely with Republican votes, heads next to the Democratic-controlled House, where it's unlikely to pass. So far, legislators and Democratic Gov. Jennifer Granholm didn't appear much closer to fixing Michigan's state budget mess.

Lawmakers were back in session at the Capitol yesterday evening for a rare weekend session, trying to avoid a possible partial government shutdown when the new budget year starts a week from today.

The state faces a projected $1.75 billion deficit in the upcoming fiscal year. No consensus on how to balance the budget has emerged despite months of negotiations between Granholm, the House and Senate.

Under the Senate plan - opposed by Granholm and Democrats as harmful to health care, public safety and education - the House would be left to start the process moving on a tax increase of at least $600 million to balance the budget. House Democratic leaders have tried several times in the past week and a half to raise the income tax to 4.6 percent, but haven't succeeded.

"These bills move us no closer to a resolution to our state budget crisis," Senate Minority Leader Mark Schauer (D-Battle Creek) said of the Senate plan's mix of cuts and spending restrictions. "In fact, they move us backward."

Republicans accused Democrats of mischaracterizing parts of the plan as cuts. They said much of their $900 million in savings would come through rejecting inflationary funding increases proposed by Democrats.

"That's not a cut to existing funding. That's a reduction or elimination of an increase," said Senate Appropriations Chairman Ron Jelinek (R-Three Oaks). "How can you call not giving an increase a cut? It's not."

Senate Democrats said schools' costs are going up, so not giving a 2.5 percent inflationary funding increase for public education is effectively a cut. Sen. Valde Garcia of Howell was the only Republican to join Democrats in voting against the part of the plan that would make cuts to state departments, which he called "unrealistic."

But Garcia joined Republican in approving the flat funding levels for K-12 schools. After voting, senators began talking again behind closed doors, meaning Senate action might not be done for the night.

Granholm has not detailed what a shutdown might look like if no budget solution is reached in the days remaining. But there could be a wide range of disrupted services including fewer state police patrols, closed secretary of state branches and state parks, no health screenings, and possibly the shutdown of the Michigan Lottery and Detroit casinos if state regulators aren't working. Payments to K-12 schools and universities also would be affected.

If the income tax rate is raised from the current 3.9 percent to 4.6 percent, the increase would raise about $1.1 billion, leaving roughly $650 million to be resolved through cuts or other revenue increases.

Senate Republicans last week offered to vote on an income tax rate of 4.3 percent, which would raise roughly $660 million and leave about $1.09 billion in cuts. Democrats were opposed to that plan because it didn't raise enough money, so it was never voted on.

Senate Republicans have approved a 30-day extension of the current budget structure, which would buy lawmakers a little more time to craft a long-term solution. Democrats have resisted a continuation budget, saying a long-term fix to Michigan's financial problems should not be delayed.

Frustration is building across the state's political spectrum. Conservative Republican Sen. Alan Sanborn of Richmond and a liberal leaning group called Progress Michigan each have called for salaries of lawmakers to be docked if a budget deal isn't done soon.

The House began its session yesterday by passing bills to extend some current fees into the next budget year. The fees - covering groundwater discharge permits, criminal background checks and other services - were kept at their current levels. But they would have expired at the end of this month if they hadn't been extended.

Rep. Craig DeRoche of Novi, the House's top ranking Republican, called on Democrats to again put up their tax increase proposal and allow members of both parties to vote their conscience.

A vote on the proposal Thursday night and Friday morning got bogged down in partisan bickering, as six Democrats opposed the measure and another didn't vote while waiting for more GOP support. Democrats hold a 58-52 advantage in the House and could send a tax increase proposal to the Senate without any Republican votes if they had their own members on board.