For Immediate Release
June 20, 2019
Lawmakers plan to take time off, leaving budget, residents’ needs in the lurch
LANSING—With the Michigan House of Representatives passing their state budget bills today and both bodies adjourning for several weeks, the Michigan League for Public Policy continued its call for new revenue and responsible leadership. After a fairly collegial and productive six months of shared political control, passing empty bills and leaving the budget to languish for the foreseeable future is a major blow to good government. Instead, the League urges policymakers to keep working and continue to seek common ground and compromise to serve all Michiganders, and to address the state’s biggest need—revenue.
“Despite Gov. Whitmer’s bold and refreshing call for new revenue to invest in the things we need as a state, lawmakers in the House and Senate dropped the ball on that and the many positive policy improvements she recommended in her budget proposal, and now they are simply taking their ball and going home,” said Gilda Z. Jacobs, President and CEO for the Michigan League for Public Policy. “When lawmakers are back home for the next few weeks, I hope they will at least take some time to listen to their constituents about what they want to see in the state budget. And I’d venture a guess that whatever district they live in and whatever they and their family need, it requires revenue and investment, not cuts.”
“The League continues to advocate for additional state revenue to support all of the things that make Michigan a great place to live and work while not having an inequitable impact on residents with lower incomes,” Jacobs added. “We support Gov. Whitmer’s proposed 45-cent gas tax increase—coupled with an increase to the Michigan EITC—as the best and most equitable way to increase revenue, fix our roads and infrastructure, and invest in our schools, public safety, and essential state services, but we are all ears if House and Senate leaders have a viable revenue proposal that meets that same criteria.”
State budget and tax policy are a primary focus of the League’s work each year, including analyzing the state budget at each step in the process. As the dust settles following the first round of budget work, here are some of the League’s key takeaways and focal points of continued negotiations.
Healthy Michigan Plan Work Requirements: The League continues to oppose Healthy Michigan Plan work requirements outright due to the potential lost health coverage for thousands of residents that could come with them. However, that lost coverage can be reduced with sufficient budget funding to implement the requirements and lessen their adverse impact on Healthy Michigan enrollees. Gov. Whitmer and the Senate both included $10 million for supportive services to help people overcome barriers to meeting the requirements, but the House did not include any money—including a placeholder—for that purpose.
Child Care Funding: Child care has been one of the biggest areas of bipartisan compromise in the Michigan Legislature over the last decade because it is so important to families and employers who have trouble attracting and keeping low-wage workers. Michigan’s child care investment has been leveraged even further with an additional $63 million each year in federal funds from the Child Care Development Block Grant (CCDBG). For 2020, Gov. Gretchen Whitmer recommended $16.4 million in federal CCDBG for a rate increase for child care providers beginning Jan. 1, 2020, as well as funding for expanding eligibility for child care subsidies. The Senate agreed with the governor on increasing child care provider rates, but the House rejected any additional rate increases.
School Funding: To address inequities in school funding and achievement, Gov. Whitmer proposed a new weighted school funding formula that would have resulted in major funding increases for students who are economically disadvantaged or have special needs, a change the League strongly supports. However, that proposal was largely rejected by the House and Senate. The governor recommended $24.5 million in funding to triple the number of literacy coaches around the state to help students meet the upcoming third-grade reading benchmarks, and reduced local cost-sharing. The Senate agreed to the expansion of literacy coaches, but the House only included $2.1 million. The Senate also increased funding for two of the League’s big priorities: the state’s Early On intervention program for children with developmental delays and disabilities and the 10 Cents a Meal program that provides school meal programs with locally-grown fruits and vegetables.
Child Support Money Pass Through: Currently, Michigan keeps all child support funds that would normally be paid to Family Independence Program (FIP) recipients. Gov. Whitmer recommended that the state adopt the maximum federally-allowed child support pass-through—$200—for the approximately 2,300 FIP families that would be eligible. At a modest cost—less than $1 million in federal funds allocated to the state—Michigan could help some of the state’s most economically vulnerable children by ensuring that child support paid by absent parents actually reaches the children, but the House and Senate both rejected the proposal in their budgets.
Support for Flint Residents: Gov. Whitmer’s budget proposal included $8.1 million for Flint residents for various health and nutrition services, lead poisoning prevention, and bottled water and filters for seniors and people with disabilities. The Senate agreed with the governor on most Flint funding, but included a placeholder to continue discussions on lead abatement contracts. The House rejected the governor’s proposed funding increase, instead retaining current funding of $4.6 million.
Restoring Michigan Earned Income Tax Credit (EITC): While it has not been discussed much as part of the Legislature’s budget negotiations, the governor’s proposed restoration of the Michigan EITC to 12 percent of the federal credit in her budget should definitely be a part of the conversation and budget negotiations. The EITC has a long history of bipartisan support and is one of the most effective anti-poverty policy tools available, benefiting families directly and having a ripple effect on local businesses and communities.
These are just a few of the League’s key priorities in the budget, and areas advocates will need to engage with lawmakers during the upcoming negotiation process. More information on the League’s in-depth budget analysis can be found at www.mlpp.org/budget, and the League’s Owner’s Manual for Michigan includes the League’s proactive policy priorities.
The Michigan League for Public Policy, www.mlpp.org, is a nonprofit policy institute focused on economic opportunity for all. It is the only state-level organization that addresses poverty in a comprehensive way.