Article of MIRS for SBAM’s Lansing Watchdog newsletter
The House Appropriations Committee rejected Wednesday afternoon $644.9 million in unspent money from the Fiscal Year (FY) 2025 budget that had been allocated by the administration as “work projects.”
It’s a move Republicans called the next step in weeding out “waste, fraud and abuse” from the state budget, which Democrats decried as Republicans play the role of Scrooge before Christmas, that will cost them at the ballot box in 2026.
This rarely taken step was passed along party lines (with Rep. Ron Robinson (R-Utica) the lone Republican no vote) and came after the State Budget Office recommended $2.7 billion in work projects that House Speaker Matt Hall (R-Richland Township) called a “slush fund” scheme that hid pork in the budget.
Had the House or Senate appropriations committee done nothing with the recommendation by the end of the week, they would have gone through per state statute.
The 1984 law that House Republicans used Wednesday – 451a of the Management and Budget Act – was recently used in 2020 when the Senate Republicans rejected four Department of Health and Human Services (DHHS) projects totaling $18.2 million. At that time, however, the state was only holding on to more than $1.74 billion in work projects.
Wednesday, the amount of money in work project accounts totaled $2.7 billion until the House Republicans cut nearly a quarter of that total.
House General Government Appropriations Committee Chair Tom Kuhn (R-Troy) said Tuesday the amount the Gov. Gretchen Whitmer administration has been squirreling away on work projects has grown exponentially. However, MIRS has since learned that much of that money was designed to shield federal dollars that came after COVID-19, when the state couldn’t spend its federal dollars fast enough.
“I don’t know who wrote this law, but it’s a great law and we utilized it,” Hall said at his press conference after the House Appropriations Committee, “We’re going to keep doing it. We’re going to keep standing up for Michigan taxpayers.”
In rejecting the work projects, the $644.9 million ($351.5 million General Fund) goes back into either the General Fund or various restricted funds within state government, unencumbered.
Hall said departments, the administration or Democrats could come back during the book closing supplemental process early next year, justify the work projects and get them back on the balance sheet through negotiations.
However, some projects – like the Michigan Climate Investment Fund and some Community Enhancement Grants – passed in 2024 under the Democratic trifecta, will be spiked Hall pledged.
House Democrats staggered out of Wednesday’s quick House Appropriations Committee meeting, stunned.
The State Budget Office presented its list of a few hundred existing and proposed work projects on Nov. 14. House Appropriations Committee Chair Ann Bollin (R-Brighton) asked her subcommittee chairs to flyspeck the list. She asked state departments to defend their spending over the Thanksgiving break since the law only gave her 30 days to deny any spending.
But Bollin said she doesn’t think most departments truly took the situation seriously until Wednesday. While she and Hall spent the day talking over several of their denials with department heads and several of their own members (who had no votes initially), Democrats didn’t have a full appreciation for what was in store for them.
“This is some corrupt bullshit,” said Rep. Jason Morgan (D-Ann Arbor), “This is a completely non-transparent process. These things were thrown at us with zero notice and zero discussion.”
Democrats hurriedly ran through the pages of denials for sexual assault kits, hair for cancer patients, the state’s Holocaust Museum, human trafficking, prenatal care for kids and cybersecurity, in what one member called the “House Republican Jobs Act.”
“The Speaker must hate being in the majority,” said Rep. Alabas Farhat (D-Dearborn), “I feel bad for his members who have to explain this in their districts. Projects they fought so hard for. Gone.”
Rep. Will Snyder (D-Muskegon) questioned the legality of some of the denials, given there are signed agreements attached to some of these dollars. He also found it hypocritical for a House Republican leadership team that coined the Hall Ethics Accountability and Transparency (HEAT) moniker this year to sneak through $644 million in cuts with no public comment or debate among appropriations members.
“Where’s the HEAT in that? It’s not here,” Snyder said, “That’s not what this is. This is embarrassing and those folks ought to be ashamed of themselves.”
The Make It In Michigan Competitiveness Fund is out $159 million. About $102 million from the Legislature’s Community Enhancement Grants is gone. $50 million in Indigent Defense Commission grants were scratched. The Clean Michigan Initiative for Brownfields is losing $15 million. The Michigan Innovation Fund is out $11 million. The Talent Together Coalition is out $12.5 million. Around $11 million in Community Development Block Grants are gone.
“Today’s actions by Speaker Hall and House Republicans will have negative consequences for Michigan families, businesses and our state’s economy,” said state Budget Director Jen Flood, “At a time when Michiganders are already hurting from federal policies, the House just voted to cut even more jobs, raise the cost of housing and health care, cut food assistance for families, and defund the state’s ability to tackle the opioid crisis. Michiganders deserve better.”
The former lead of the Senate Democrats’ appropriations process, Democratic Party Chair Curtis Hertel said, “Not even Scrooge himself would cut food programs, veterans services, and funding for mental health programs for child sexual assault victims two weeks before Christmas. This decision torpedoes jobs and key programs for countless working families. . .”
“I personally can’t wait for the Ghost of Christmas Future to visit him and show him a Democratic majority next year,” he said.
Michigan Forward said Wednesday’s action is an “unprecedented move that puts a stop to decades of out-of-control spending by Lansing bureaucrats and their insider allies.”
“This is a huge win for taxpayers,” said Gabe Butzke, a spokesperson for Michigan Forward Network, “The Legislature gets to decide how taxpayer money is spent – not Lansing bureaucrats. For too long, state departments have spent millions of dollars without oversight or accountability, and House Republicans are putting a stop to it.”
Click here for more News & Resources.