New Budget Numbers Complicate Tax Rollback Talk

May 18, 2017

State Capitol - file photo
Credit Melissa Benmark / WKAR

(MPRN-Lansing) Big plans in Lansing for tax cuts or paying down debt could be complicated by new budget forecasts. The new numbers show there’s less money than expected for balancing the budget. 

The numbers show a slowdown in tax collections that affect the state’s discretionary checking account. But the forecast for the School Aid Fund shows more money than expected. So lawmakers have $392.7 million less than expected in the General Fund, and a $539.7 million windfall in the School Aid Fund.

“This is all good news from my standpoint because the plan we set forth can continue with the numbers here,”

said Senator David Hildenbrand (R-Lowell).

“We may have to shift some money around to accomplish some things and to stay on the same course, but I think it’s very do-able.”

Republican lawmakers have been shaving down parts of Governor Rick Snyder’s proposed budget to squirrel away money for a tax rollback or converting Michigan’s teacher retirement system to a 401 K.

State Representative Laura Cox (R-Livonia) chairs the House Appropriations Committee. Cox says she hasn’t given up on a state income tax rollback, but acknowledges it may not be realistic.

“Once we crunch the numbers and we kind of have a meeting of the minds,” she said, “then that might lead us where, while we would have liked to do a tax cut, we might not have the money to do it.”

“It kind of gives us a roadmap to complete the budget,”

said Al Pscholka, Governor Snyder’s budget director.

He says caution will be the rule, but things are on track to get the budget done by early next month. There could be a fight over once again using the School Aid Fund to pay for universities.

That’s opposed by Democrats and K-12 school officials. The Snyder administration and Senate Republicans are also at odds over corrections spending.