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The state budget process in Michigan is nearing a critical juncture as the legal deadline of July 1st looms. This date, now considered by many as largely symbolic, is set for budget completion, yet significant work remains.
Late into Thursday night, the state House, led by Republicans, deliberated on their proposed higher education budget. However, this proposal faces strong opposition in the Democratic-controlled Senate.
The Senate has crafted its own budget plan, necessitating reconciliation with the House version before any budget bills reach Governor Gretchen Whitmer’s desk. The July 1st deadline is fast approaching, emphasizing the urgency of this matter.
The GOP’s budget proposal seeks substantial cuts for the University of Michigan and Michigan State University, reallocating funds to other state universities with proposed double-digit increases.
This represents a stark departure from the initial GOP budget approved by a House committee earlier this week. However, this version is far from final.
Senator Sarah Anthony (D-Lansing), chair of the Senate Appropriations Committee, criticized the House GOP budget as “not serious.”
The implications of the July 1st deadline extend beyond academia to affect school districts and local governments. Without clarity on funding, these entities face significant uncertainty as they begin their fiscal year.
While the state fiscal year commences on October 1st, providing some legislative leeway, local governments and families reliant on university funding feel the immediate impact.
The budget proposal’s double-digit increases for 13 other public universities could be beneficial, potentially lowering tuition. However, the feasibility of such expectations remains in question.
The political dimensions of this budget process are notable, particularly concerning the boards of the “Big 3” universities: the University of Michigan, Michigan State University, and Wayne State University. These boards are elected positions, with candidates often being alumni and substantial party donors, nominated at state conventions.
Behind the scenes, these university board members and donors may exert influence as the budget process unfolds.
Why Michigan’s Fiscal Year Begins in October
Historically, Michigan’s fiscal year began on July 1st, aligning with other governmental entities. However, economic challenges in the 1970s prompted a shift to October 1st, aimed at providing more time to balance the state’s budget.
John Lindstrom, publisher emeritus of Gongwer News Service, recalls this change as “an act of desperation” during a period of economic recession. The change allowed the state to manage its finances amidst declining auto industry revenues.
The fiscal misalignment with other governmental units initially caused challenges, leading to political changes like the Headlee Amendment.
While a recent state law mandates budget completion by July 1st, the lack of penalties for non-compliance means the legislature is likely to miss this deadline again this year.
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Questions about Michigan politics? Share your thoughts or feedback on the newsletter with us at politics@michiganpublic.org!
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Current Political Discussions
Local Impact: Recently, the Republican-led U.S. House voted to retract funding for public media. “The measure passed largely along party lines, 214 to 212,” NPR’s Deirdre Walsh and David Folkenflick report. This proposal aims to cut $1.1 billion from the Corporation for Public Broadcasting over the next two fiscal years. The Senate has until July 18th to respond, with more information available at protectmypubliamedia.org.
Political Moves: Congressman John James’ potential gubernatorial run stirred discussions, with President Trump expressing reservations about losing a GOP seat.Trump commented, “You know, he’s running for governor. But I’m not sure I’m happy about that, John.”
Democratic Strategies: Michigan U.S. Senator Elissa Slotkin is gaining attention for her insights on Democratic strategies. Slotkin emphasizes economic focus over divisive social issues in her upcoming address to the Center for American Progress. Her plans include addressing Medicaid cuts, tariffs, and AI’s impact on jobs.
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Best Regards,
Rick Pluta & Zoe Clark
Co-hosts, It’s Just Politics
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