Honigman Capitol Report

Senate Democrats Pass Budget $1.1B more than Governor’s

The Senate Democrats passed a $85.95 billion state budget for Fiscal Year 2026, which is $1.1 billion more than the Governor's proposal. The budget includes provisions for grants to offset business losses from President Trump's tariff policy and allocates $10,008 per-pupil for school allowances, which must contribute to teacher raises. It also sets aside $3 billion for a long-term road funding plan and $30 million for a Caregiver Tax Credit. The Senate's health and human services budget allocates $315 million, including $200 million from the federal government, to ensure care workers are compensated under Michigan's new wage laws following a Michigan Supreme Court ruling. The state's minimum wage is set to increase to $15 per hour by 2027. The labor and economic opportunity budget includes funds for tariff relief grants related to Trump's tariffs, with a $100 million grant pool for affected businesses. It also provides $10 million for apprenticeship and adult education grants, $10 million for food banks, and $1 million to study domestic fire truck manufacturing. The PreK-12 budget reallocates funds to create $350 million in school infrastructure grants, partly to assist districts affected by federal education program cuts.

The budget passed mostly along party lines, with Republicans proposing amendments for parity between public and private schools and restrictions on sports participation based on gender. Senate Republicans also called for increased in-person work mandates for government workers. The budget for the Department of Natural Resources was the only proposal not passed along party lines, with bipartisan support for increased fishing and hunting license fees to generate $28.8 million for state parks. House Speaker Matt Hall criticized the Senate's budget as lacking creativity and suggested more time was needed to develop a comprehensive plan.

Revenue Estimating Conference Official Revenue Forecasts Announced Friday

The May Consensus Revenue Estimating Conference was held last Friday and included presentations focusing on state and federal economies and state government revenues. Official revenue forecasts were established for fiscal years 2025, 2026, and 2027 by a consensus of the conference principals including the State Treasurer, the Director of the Senate Fiscal Agency, and the Director of the House Fiscal Agency. Overall Revenue Forecasts (in millions) are listed below:

Revenue estimates are based on the most recent economic projections and forecasting models.

Committee News

School Safety Bills Clear House

Several school safety bills passed in the House last Wednesday with bipartisan support. The legislation aims to enhance school safety requirements and emergency operations, including mandating the inclusion of the OK2SAY tip line number on student ID cards and requiring the Department of Education's Office of School Safety to compile and report OK2SAY tips to the School Safety and Mental Health Commission. Republican Representative Mike Harris emphasized the importance of these proposals, while Democrat Representative Kelly Breen highlighted the continuation of previous efforts to establish common terminology for school safety. Specific bills include HB 4222, which modifies school safety requirements and mandates a school crisis team and emergency operations plan for nonpublic schools, HB 4226 which adjusts the number and scheduling of school safety drills, HB 4225 which amends the Save Our Students Act to require school ID cards to include OK2SAY contact information, HB 4223 which requires schools to develop a safety and security training plan, with a provision for nonpublic schools to exempt themselves, along with several other related bills.

Election News

Tate Announces U.S. Senate Candidacy

Former Speaker Joe Tate has announced his candidacy for the U.S. Senate, shifting from previous rumors of a mayoral run in Detroit for 2025. As the first Black speaker of the House and the only Black candidate in the Democratic primary, winning the Black vote is seen as crucial to his campaign strategy. However, Adrian Hemond of Grassroots Midwest suggests that focusing solely on the Black vote may not be effective, citing Tate's initial loss in a state representative race where he later won by appealing to white progressives. Michael Ceraso, Tate's campaign press secretary, emphasized the importance of engaging with all voter groups and highlighted Tate's Michigan ties, veteran status, and background as a Michigan State University football player as unique aspects of his candidacy. In his campaign announcement video, Tate highlighted his 2023 accomplishments, such as gun reform and repealing the senior pension tax.  Hemond expressed skepticism about the effectiveness of campaigning on past achievements, especially those accomplished during a Democratic trifecta, in an election likely influenced by discussions about former President Trump. Hemond also noted that Tate would need to raise several million dollars in the next 60 days to remain competitive. Speaker Matt Hall has criticized Tate's leadership, pointing to a failed bill sponsored by Tate and highlighting divisions within the Democratic caucus. Despite rumors of a mayoral run, Tate has opted for a statewide campaign, though Hemond questioned the electoral logic behind this decision. Tate is entering a competitive field that includes candidates like Abdul El-Sayed, Sen. Mallory McMorrow, and U.S. Rep. Haley Stevens.

On Point

Client Alert:Trump Administration Moves to Dismantle Disparate Impact Liability in Federal Civil Rights Enforcement

Looking Ahead

Following negotiations between the Senate Majority Leader and the Speaker of the House, Senate Bill 99 and Senate Bill 100 passed both chambers and were sent to the Governor for her signature. These two bills, which extend the timing for financial disclosures, are the third and fourth bills signed into law by the Governor so far this session. Due to continued litigation around 9 outstanding bills from the previous term the House and Senate have been at an impasse since January. The negotiated and passed bills could be a broader opening for non-controversial bills to begin moving before summer.