Revenue forecast emphasizes need to prioritize kids and families in budget decisions

A version of this column originally appeared in Michigan Advance.

Jan.16 marked the unofficial kickoff of a new budget season in Michigan, with state fiscal experts and economists converging on the Capitol to provide revenue forecasts and talk more broadly about the state’s financial picture at the Consensus Revenue Estimating Conference. As predicted, revenue projections were down, driven largely by intentional tax changes last year, which will constrain the state’s ability to provide for Michigan residents at an already-unstable time.

With federal threats and attacks on health care, education, food assistance, housing and other basic needs set to upend the lives of families across the state, it’s crucial that state leaders do what they can to mitigate harm for Michiganders, not just now but in the future. 

Merely protecting the basics is not enough, but we cannot do more with less, so any push by state lawmakers to implement steep tax cuts or simply shift funds around is ineffective and irresponsible at best. Leaders need to determine what is necessary to ensure Michiganders are thriving. They need to determine how they can improve the state’s revenue structure to best serve the needs of the people. We recognize this won’t be easy, especially when policymakers in Washington have put a major strain on the state’s budget by prioritizing tax cuts for the wealthiest Americans over health care and the cost of groceries. But Michigan’s leaders need to work together to meet this moment. 

As the governor and state lawmakers begin crafting their respective budgets, they need to keep Michigan’s people central to their decisions. Strong Medicaid and Supplemental Nutrition Assistance Program (SNAP) policies are necessary to make sure families don’t fall through the cracks. It’s also vital that we improve child care affordability and accessibility, reduce the rising cost of safe and affordable housing, and continue to invest in programs that create family economic security, like Rx Kids.

And right now, we absolutely cannot lose sight of the importance of stronger, more sustained investments in the state’s K-12 system. Michigan continues to rank abysmally low in education nationally. Our current ranking from the Annie E. Casey Foundation’s KIDS COUNT® data is 44th, putting us squarely in the bottom 10 states in the country for education once again. Making sure students have what they need to be successful in their classrooms is crucial to stopping this trend. 

While some forward movement has been made in educational funding by the state more recently, it doesn’t change the fact that Michigan spent decades underinvesting in public schools. Recovery is in the very early stages, especially when you consider inflation. School districts are also struggling with more restrictions on how they can use state funding and are providing many additional, important services outside of the classroom these days that need to continue to be financially supported. Federal threats to the state’s public education system will also undermine the progress that has been made in these past few years.

Given these challenges, the state must continue to target investments toward those who need it most: students who come from economically disadvantaged backgrounds, students in need of special education services and English-language learners. Almost half of Michigan students — nearly  684,500 — are economically disadvantaged, and the share of students growing up in homes with low incomes is even higher in some Michigan counties. And the number of special education students from birth to age 26 is on the rise, growing from more than 208,500 in 2018 to over 223,000 in 2024 in Michigan. And statewide, more than 171,300 children ages 5 to 17 live in a home where a language other than English is spoken. Stronger, targeted investments in these students are necessary to ensure they thrive in their classrooms. Maintaining investments in student and mental health services and investing in effective literacy support are also necessary if schools are to do the job of supporting students.

When we talk about meeting this moment, we recognize it will be challenging, but we also know state leaders can come together to create an equitable and balanced budget that puts children, families, workers and students first. The time is now to step up for the people of Michigan.