Whitmer Signs Nearly $55B Omnibus Budget, Tax Relief Negotiations Continuing
July 26, 2022
(DETROIT) – The Motor City sizzled at around 90 degrees as Gov. Gretchen Whitmer placed her final signature on a nearly $55 billion omnibus budget, reiterating that negotiations over tax relief will continue throughout the summer.
Wednesday’s budget, which the Governor signed at the Corner Ballpark in Detroit’s Corktown, lifts Michigan’s rainy-day fund to an all-time high of $1.6 billion. Whitmer also highlighted the budget’s blueprint for paying down billions in debt and securing the retirement of state troopers and other public servants.
After the press conference, State Budget Director Chris Harkins said the Governor’s office and the Legislature were very purposeful in constructing the budget.
“I think there’s a lot of focus on the fact that these are high numbers in terms of spending compared to what we’ve done historically, but a lot of it is also one-time in nature. We’ve got about a $15 billion (General Fund) investment for (2023) . . . but with that $15 billion, about $12 billion is ongoing,” Harkins told MIRS.
Michigan now has a balance sheet of approximately $7 billion, but Harkins clarified that about $1.4 billion in state revenue is intended to be ongoing in-nature.
“So . . . as we look at tax relief packages that are ongoing, we’d need to make sure to keep that number in mind,” Harkins said.
The Fiscal Year (FY) 2023 budget plan features measures to pay off an extra $2.6 billion of Michigan’s public employee retirement system debt. It additionally invests $30 million into recruitment and training for emergency medical service (EMS) providers and $50 million into various nonprofit organizations as they recover from a strain on resources in relation to the COVID-19 pandemic.
Financing a new state psychiatric hospital complex in replacement of the Walter Reuther Hospital in Westland and the Hawthorn Center in Northville were spotlighted, as well. It simultaneously offers student loan reimbursements for behavioral health professionals.
Whitmer noted that the budget improves dental care access for residents enrolled in Medicaid, speeds up lead service line replacement and financially backs the Michigan Reconnect and Going Pro programs for education access and workforce development, respectively.
“And best of all, we didn’t raise taxes by a dime to get it done and (got it) done on time,” Whitmer said. “It invests in people, it unleashes Michigan’s potential and it funds key projects.”
Wednesday’s event consisted of statements from Detroit Mayor Mike Duggan, Wayne County Executive Warren Evans and acting CEO Fredrick Hunter and Youth Enrichment Director Maria Franklin of Detroit’s Police Athletic Program (PAL).
Detroit’s PAL was designed in partnership with the city’s police department and provides the city with athletic, academic and leadership development programs for youths. Under the FY 2023 budget, the program will acquire $7.5 million. The money will open up the window for Detroit PAL to potentially expand into Grand Rapids and Flint.
Duggan underscored that the budget will supply the city with funds to construct the Joe Louis Greenway, transforming an abandoned railroad track covered in dumped tires into “the most beautiful park and freeway system.”
“There’s $100 million here for Wayne State University to build a new cancer research center,” Duggan said. “. . . $100 million in here for the University of Michigan to build an innovation center – a grad school for mobility and latest tech jobs in the shadow of the train station, which if you haven’t driven by it to see what’s going on there – it’s absolutely spectacular.”
Furthermore, the city anticipates $2.5 million going into Detroit’s Sickle Cell Center, $12 million for the Eastern Market, $1 million for the Ruth Ellis Center delivering trauma-informed services to LGBTQ-plus youths and young adults of color and $590,000 to Alternative for Girls to assist homeless and high–risk girls in the city.
“‘Detroit versus Everybody’ is more than a slogan on a hat or a t-shirt, it’s an earned attitude of resilience – of pride, and that spirit lives right here in all of you,” Whitmer said.
Some conservative commentators have criticized the budget for consisting of too much spending and not enough economic relief being directed to the everyday resident’s pockets.
“I don’t think we were interested in rushing into a relief package. I think the Governor has been really clear all along as to what her interests have been. It’s in targeted relief,” Harkins said.
The Governor would like to see a temporary suspension of Michigan’s sales tax on gas, rolling back retirement taxes to return an average of $1,000 to seniors and tripping the state’s Earned Income Tax Credit to distribute $3,000 refunds to 730,000 working families in the state.
She’s also advocated for $500 inflation relief checks to be dished out.
Whitmer said her office has been very strategic in ensuring that one-time dollars are not used for ongoing expenditures. This year, Republican lawmakers in Lansing have been organizing to combat record-high inflation with long-standing tax reductions – specifically, a drop in the state’s income tax from 4.25% to 3.9%.
However, the Governor said the prudent way the budget was designed “will help us sustain those fundamental investments and be able to really put Michigan on a long term path for prosperity.”