Gov. Rick Snyder signed a budget bill June 21 that both eliminates Michigan’s $1.5 billion deficit and reduces funding for the state’s universities, leaving students with increased tuition rates and decreased department and program opportunities.
The budget for the upcoming fiscal year, which begins Oct. 1, was passed in the state House and Senate at the end of May before being signed by Snyder last week.
The adoption of this budget marks a major milestone for Michigan, Snyder said.
“If you step back and look at the hard work this team had done, … it is about jobs; it is about our young people; and it is exciting because it is focusing on the reinvention of our state,” he said.
But difficult decisions had to be made in order to balance the $47.4 billion budget, including cuts to eduction.
Higher education cuts
Next year’s budget cut of 15 percent in state university funding is unprecedented, said Mike Boulus, executive director of the Presidents Council of State Universities of Michigan.
“There is no cut greater on record,” he said. “It is a historic cut — an enormous cut of enormous proportion.”
Michigan’s 15 public universities collectively will receive $213.1 million less than they did the previous fiscal year.
Economics professor Charles Ballard said public officials from both parties talk about the need for an educated workforce, yet their number one prescription for balancing a budget is reductions in education funding. To him, this does not make sense.
“We need to have skills that are at the top of the chain if we want an economy at the top of the chain,” Ballard said.
But Kurt Weiss, spokesman for the State Budget Office, said this cut carefully was considered by the governor and state lawmakers.
“It was a cut that they looked at, and they knew all the cuts for education were difficult,” he said. “(They) felt it was a cut universities could absorb.”
Because there are about 234,000 public university students in state, Boulus said this funding cut translates into a per-student cut of nearly $1,000.
Such university tuition increases likely won’t cover the whole per-student funding reduction, so cuts will be made to university programs and departments to make up for this shortfall.
State Rep. Mark Meadows, D-East Lansing, said these cuts to education in the budget were unnecessary.
“None of this is very thought out,” he said.
Appropriations
Snyder said this budget was tough to balance.
“We had to make difficult choices to make this budget work,” he said. “That was not easy, and we know we’re asking for sacrifice from people.”
Ballard was disappointed to see a reduction in the state’s Earned Income Tax Credit, which provides income support for low income wage workers. But there were some things lawmakers did right with this budget, Ballard said.
In one budget bill signed by Snyder are two sections of boilerplate language that require the reporting of embryonic stem cell research conducted and no longer allowing the offering of employee domestic partner benefits in universities. Although Snyder said such sections are unenforceable, he left them in the signed budget legislation because they represent the intent of lawmakers, he said.
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With their inclusion in the budget, the issues could face further debate among lawmakers, Boulus said.
“I think there’s a lot of legislation (and) policy being driven by social and religious beliefs in a conservative (political) environment, and it’s very problematic,” he said.
Looking ahead
Snyder was happy to have this budget adopted earlier than Michigan’s budget has been adopted in years. Because many of their own budgets begin on July 1, local school districts and municipalities are able to better plan their upcoming fiscal year.
The fact that Michigan’s budget finally is balanced without the use of one-time money also will benefit the state, Weiss said.
Businesses will be more willing to locate in Michigan, knowing that the state government will be less likely to create or increase business taxes in order to pay their debt.
But Meadows does not believe this budget sets a strong foundation for Michigan’s successful future.
“No changes (have been made) structurally or long term in any way,” he said.
“The governor likes to call this a game changer, but this really isn’t.”
This budget will bring a change, Weiss said.
“We feel like we’re in structural balance now, so moving forward, we can talk about how we fund our priorities rather than what we have to cut,” Weiss said. “You’re going to see a very different conversation next year.”
