Anthony: No Major Budget-Making Decisions Made Despite Possible Gov Shutdown

Article courtesy MIRS News for SBAM’s Lansing Watchdog newsletter

Less than 21 days away from a possible government shutdown if budget deals aren’t reached and implemented, and Senate Appropriations Chair Sarah Anthony (D-Lansing) says no major decisions have been made around what a budget agreement will look like.

“I’ve been frustrated because we’re not meeting enough to actually get to the heart of these negotiations . . . whether it is work projects or how we’re going to address holes related to the federal tax changes, none of those pieces have been decided at this juncture,” Anthony said. “Twenty days before a government shutdown and the major decisions have not been made.”

Anthony explained that meetings and phone calls are obviously being had among Lansing’s top budget negotiators, but no decision-making, contributing to her frustration.

She described how she likes to contact legislative appropriations chairs of the past, with Senate appropriations chairs from 1985 through 2022 being Republican. Anthony explained she sometimes asks a few of her Republican predecessors: “Is this normal? Tell me about when you were in divided government?”

“What they tell me is a few things . . . that these budget negotiations in a normal year, regardless of who’s R or D, take somewhere between four (and) six weeks just to go line-by-line, budget-by-budget,” Anthony said. “(House Speaker Matt Hall (R-Richland Township)) has put us in a very dangerous position as it relates to this budget process.”

Wednesday morning, Anthony hosted a press conference in which Sens. Mallory McMorrow (D-Royal Oak), John Cherry (D-Flint) and Sylvia Santana (D-Detroit) targeted offending parts of the House Republicans’ general government budget bill, HB 4706, which representatives passed 59-46 on Aug. 26.

Wednesday, Senate Democrats criticized HB 4706 over its measures to create savings through eliminating “phantom” full-time job posts in departments that are currently unoccupied. Democrats argued that the House’s job cuts don’t consider how “full-time equivalent” (FTE) funding covers overtime, part-time and contract worker costs.

Furthermore, they targeted the House’s proposal to reduce Medicaid-covered direct care agency rates by $4.56 hourly, as well as their decision to place $330.5 million in Supplemental Nutrition Assistance Program (SNAP) funding into an isolated fund requiring legislative transfer approval and fraud and waste reporting to access.

As for the subject of possibly saving money through disbanding work projects funded for in the past, McMorrow described her own past ambitions to revert money spent to win large corporate developments back to the state’s General Fund if projects don’t come to their full fruition.

“I think there is (grief) on both sides of the aisle that we need reform (around) work projects, especially related to economic development,” McMorrow said. “There is space for agreement to address some of those things while acknowledging the misinformation. The idea that we are somehow spending on positions that haven’t been filled instead of that money rolling over to the next year is simply false.”

However, she said negotiating dollars returning to the General Fund “requires starting this process much earlier.”

The topic of phantom FTEs was discussed on the Sept. 1 episode of the MIRS Monday Podcast, featuring Sen. Jeff Irwin (D-Ann Arbor) – chair of the Senate Appropriations subcommittee overseeing the Department of Environment, Great Lakes and Energy (EGLE) – and Rep. Phil Green (R-Millington).

Green chairs the House Appropriations Public Health Subcommittee, proposing the removal of 139 FTEs.

“It seems that this is sort of an accounting gimmick where they will ask for a certain number of employees – FTEs – and then they’ll be able to shift that money inside the line item,” Green said.

For example, Green warned that the state’s health department could propose a $100 million program requiring 20 FTEs. If merely 10 FTE positions are filled, the paycheck money could be put “over into the programming.”

“So what we want to do is make sure that we have truth in budgeting, that we know how much a program is costing along with how much the FTEs are costing,” Green said. “We can call them phantom FTEs or phantom employees . . . come the end of the year, now there’s a little bit of a slush fund there.”

He explained the unspent FTE money permits departments to ask for money to be transferred around within itself for other expenses they have.

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