Whitmer Announces Budget Proposal

Governor Gretchen Whitmer revealed a $80.7 billion budget proposal on Wednesday focused on investments in balancing the budget, education, lowering costs, infrastructure, public safety and economic development. The proposal marks the Governor’s sixth budget proposal and includes $14.3 billion in General Fund spending. The proposed school aid budget accounts for another $19 billion. While the proposal maintains the spending on newer proposals brought forth in recent years, fewer new initiatives were proposed.

Balancing the Budget

Whitmer proposes a budget recommendation which sets aside cash for the state’s “rainy day” fund and brings retirement debt paid off to more than $21 billion total since the beginning of her administration. Specifically, the Governor proposes paying off Michigan Public School Employees’ Retirement System to free up $670 million for classroom investment. Other key budget balancing proposals include $100 million into the Budget Stabilization Fund, $10 million towards the Disaster and Emergency Contingency Fund and $4.4 million towards improved environmental permitting efforts.

Public Safety & Health

Public Health and Safety was also a focus of Whitmer’s budget proposal. The Governor recommends investing $11 million in revenue sharing specifically for public safety including recruitment, retention, training and equipment for first responders and an additional $5.5 million to support costs of the state police trooper recruit school. Public Health proposals include $193.3 million to establish behavioral health clinics and $46 million for updates to the Family Independence Program which has not been substantially changed since 1990.

Education

Education was the big winner in Whitmer’s proposal, with several major expenditures directed towards school programs. Notably, $370 million is proposed towards a 2.5% increase in per-pupil funding for an additional $241 per student, bringing the total for each pupil to $9,849. The proposal also includes $300 million for investment into mental health and school safety needs, $251.2 million for literacy grants and coaches, $200 million towards universal free breakfast and lunch and $200 million towards tutoring through the MI Kids Back on Track program. Several other investments are proposed throughout the preschool through postsecondary education system including funding to address teacher shortages. The Governor also called for $159 million extra to be infused into her Great Start Readiness Program (“GSRP”) to cover more households sooner. The proposal consists of $63.5 million towards bringing an additional 6,800 children to the program and $35 million towards bringing GSRP classrooms into underserved communities.

Economic Development & Infrastructure

Another focus of Whitmer’s proposed budget includes investments into the Governor’s Making it in Michigan plan which focuses on economic development and improvements to infrastructure. Similar to last year, the proposal includes $500 million to the Strategic Outreach and Attraction Reserve (“SOAR”) Fund. The SOAR Fund is designed to attract new manufacturers and industries to Michigan to promote economic diversity and compete nationally for high-paying jobs. An additional $100 million is proposed for a research and development tax credit included in the Governor’s State of the State Address to spur innovation. Infrastructure investments proposed include $700 million towards the final part of the Rebuilding Michigan Plan and $247.6 million towards improving roads, highways and bridges across the state.