But the process is intensified when both sides of the aisles are “at each other’s throats,” as state Sen. Mickey Switalski, D-Roseville, said.

Republicans and Democrats were gasping for air, while a state in debt to the tune of $1.75 billion was in hot water.

Devin Brent, an interdisciplinary studies in social science junior, said last year’s budget ordeal was just another problem piled onto the state.

“We’re already in a one-state recession,” Brent said he remembered thinking. “What could go worse?”

The state was in lockdown mode for about five hours. The main dividing points were replacing the Single Business Tax with the Michigan Business Tax, and an increase in the state income tax.

In an inexperienced, Democratic-controlled state House of Representatives and a Republican-controlled state Senate, the two sides found cooperation difficult.

“I thought, ‘This is total chaos. This is incompetent leadership. This is total dysfunction,’” said state Rep. Rick Jones, R-Grand Ledge. “I thought, ‘We need drastic change in this state.’”

The state definitely needed drastic change. It needed $1.75 billion of it.

Two-party dysfunction

Fresh-faced senators and representatives might have been in over their heads with the budget situation, Jones said.

Legislators remarked that with so many new people in Lansing, there was a certain naivety about the budget process. They held on to what they knew — their ideology.

“There was a fair amount of partisan bickering and disagreement, but at the same time we accomplished it,” Bieda said.

“I just hope we never have to see anything like that again.”

Bieda said there was a definite learning curve for many Lansing politicians. Jones would attribute many of the problems with last year’s process to inexperience caused by term limits.

With so many new members in the state House, Jones said most had never had to deal with budgets.

But these politicians knew what their parties stood for and stuck to their positions.

“The state largely was a political problem,” said Mark Grebner, a political consultant for Practical Political Consulting Inc.

Bieda said most people remained on their side of the aisle, but the few who crossed it were the difference-makers.

“The reason things got done is because there were people who were willing to be bipartisan,” he said.

“It showed a great deal of political courage (and they) put themselves in political danger by doing it.”

Taxation with representation

State Budget Office spokeswoman Leslee Fritz said setting the 2008-09 budget — which was finalized this week — was “much less contentious,” because tax increases were not on anybody’s agenda.

But last year, it was the agenda.

And raising taxes was the correct move, said Douglas Roberts, director of MSU’s Institute for Public Policy and Social Research and a former state treasurer.

Grebner agrees increasing taxes was necessary, but he said taxes didn’t increase enough.

Grebner said the state’s infrastructure is the most visible example, since roads are crumbling and funds aren’t available to remedy the problem. Bolder measures – such as a desired 2.5 percent increase to fund higher education that ended up as a 1 percent increase – fell short.

“There’s no money available for improvements,” Grebner said.

“Everything is bare-bones level and quality of life in the state has been damaged as a result.”

Bob Fish, CEO and co-founder of Biggby Coffee, said the state’s Michigan Business Tax is a step back for Michigan.

Fish said the tax and its 22 percent surcharge, which was supposed to be revenue-neutral, has placed a burden on state businesses because it taxes more than the Single Business Tax.

“There is not one person in the business community who has said ‘thank you’ for passing this legislation,” Fish said.

Tax increases were accompanied by budget slashing, and psychology freshman Alycia Mosher said her hometown of Charlotte felt the cuts.

“It was a big thing, because I come from a small town,” Mosher said. “What little funding we had got cut, so a lot of our extracurriculars and stuff were gone.”

The 2008-09 budget

Lansing is calm this October.

Even during an election year, life has slowed down for legislators. The state budget was approved, for the most part, in July. The Legislature finalized the budget in late September, when it passed the transportation budget.

The state made cuts to corrections, as Roberts expected. Higher education increased by 1 percent – again. Taxes were not largely debated.

By putting the budget issue to rest early, the state was able to pass “landmark legislation” with the renewable portfolio standard, the Great Lakes compact and other energy and jobs-related measures, Switalski said.

And Lansing earned this relative calm.

By camping out in the Capitol last year, legislators managed a minor surplus for the state, carrying over into 2008-09. And while Michigan legislators have tried to erase memories from last fall, several other states — like California, which is about $15 billion in debt — could face the nightmares Michigan endured last year.

The national financial crisis doesn’t help, either.

Michigan has a minimal amount of padding worked into the state budget, but it’s not enough — considering the state and nation will see declining revenues as a result of lending and unemployment problems.

With Michigan’s unemployment rate sitting atop the nation at 8.9 percent, the increase in income taxes from 3.9 percent to 4.35 percent last year probably won’t be enough to make up for the loss in employment, Switalski said.

“It will eventually have an effect on us, but at least we are treading water now,” he said. “If we didn’t do what we did last year and then have this piled on top of us, we’d be drowning.”

Although the state Legislature had problems approving the budget last year, Fritz said that process was valuable and helped expedite this year’s budget setting.

“Certainly there was a lot of additional relationship building,” she said. “In an era of term limits, we don’t have those relationships much anymore.”

Speaking of term limits

If legislators thought the 2007-08 budget process was torturous, the 2009-2010 budget could be even worse.

There will be a new governor in 2010. There will be a new state Senate in 2010. There will be a new state House in 2010. And there will be a new U.S. Census in 2010 — which means district lines could be redrawn for U.S. House seats.

Parties will try to assert themselves with the 2009-2010 budget, so they can use it as a political chip in gaining a majority in the House and Senate and to win the gubernatorial election, Roberts said.

If a party earns those three prizes, if can redraw district lines to create more favorable advantages for their party, he said.

“That Legislature will decide what the rules will be for the next 10 years,” Roberts said.

“If things go right (with the budget), one side will take credit. If they go wrong, it will turn into the blame game.”

When asked about last year’s budget situation, Gov. Jennifer Granholm’s spokeswoman Liz Boyd preferred to focus on the present.

“There’s so much history there,” Boyd said. “That was a year ago.”

But what will they be saying a year from now?

Roberts has an idea: “It will be a huge political fight.”