When he presented his budget to the legislature, Governor Snyder explained part of the shared sacrifice would be taxing public and private pensions. There is no state income tax on pensions right now. The Governor noted, retirees still use government services. He also said there are some retirees who are still working, paying the current 4.35% in state income taxes. He said taxing pensions is a matter of fairness to people of retirement age who are still working.
Several university presidents visited the state Capitol to testify on the higher education budget.
Governor Rick Snyder has called for double-digit cuts to universities, but he says universities can recoup some of that if they find innovative ways to save taxpayers money.
Thomas Haas, president of Grand Valley State University, told lawmakers that universities have limited options when it comes to funding.
He says keeping tuition rates low also helps makes college more accessible to low-income students:
"Please remember there is a direct relationship between state aid and tuition. When there is more of one, we need less of the other," said Haas.
"In the long run, the best way for you to hold down tuition is to put all you can into higher education appropriations, permitting us to find financial aid for our neediest students."
University of Michigan President Mary Sue Coleman said higher education institutions understand the budget challenges the state faces, but she also could not promise to keep down tuition increases if there are big cuts in state aid to universities.
Lt. Governor Brian Calley is detailing the Snyder Administration's tax plans to members of the House Tax Policy committee at the Capitol, the Associated Press reports. And, as the AP notes, Budget Director John Nixon answered questions this morning from members of the House Appropriations Committee:
Gov. Rick Snyder's administration is trying to shore up support for some of its budget proposals that are running into opposition in the Michigan Legislature... The Republican governor's plan to eliminate tax exemptions on pensions is drawing opposition from some members of his own party.
Lawmakers also are concerned about proposed cuts to education funding and proposed cuts to tax revenue sharing payments made to local governments.
Lawmakers at the state Capitol are set to hear details today about Governor Rick Snyder's budget proposal.
Legislative committees are scheduled to hear details about Snyder's tax restructuring plan, the Associated Press reports.
From the AP:
Lawmakers also will hear testimony from some university officials, including from the University of Michigan in Ann Arbor. Universities could lose at least 15 percent of their state aid going into next fiscal year.
Groups concerned about proposed cuts to tax revenue sharing payments also are expected to testify. Snyder and lawmakers are trying to eliminate a projected budget shortfall of roughly $1.4 billion for the upcoming fiscal year.
Budget cuts approved by the U.S. House of Representatives would close Michigan Works service centers.
The service centers are where people go to file for unemployment and can get training, education or use the Michigan Talent Bank.
The U.S. House budget proposal eliminates the federal funding that supports the centers.
Luanne Dunsford is the CEO of Michigan Works.
"If the house resolution goes through the funding for Michigan Works would be eliminated. The Michigan Works system serves over 3 million customers a year and our question is, where would those people go?
The U.S. House and the Senate are now negotiating budget proposals to decide the fate of several federal programs, including the Workforce Reinvestment Act which funds Michigan Works.
We want to get a better understanding of the kinds of services offered by Michigan Works. If you've used Michigan Works, what services did you use and what did you think of them?
Governor Rick Snyder is defending some of his controversial budget plans.
He says taxing pensions is the right thing to do, even though some Republican lawmakers say they will not support that plan.
And Governor Snyder says his proposal to cut funding for universities by 15% this year is necessary, but he says it will get better for the schools in the future:
"We shouldn't have to walk away from our universities. Again, I'm a big, long-term advocate of we need more students going through our universities. Higher Ed is very important in our state, actually we're a very fortunate state in having the high-quality institutions that we have.
We have a tough budget situation and we need to deal with that, but if you look forward to 2013 we’re able to show that hopefully this is the bottom point in terms of where we go with higher education funding."
Snyder also told building-trade union members that he wants to work with unions to help balance the budget, not against them.
He says he is not interested in Republican proposals in the Legislature to strip unions of their power.
Michigan Senator Debbie Stabenow says she's cosponsoring legislation that will stop member of Congress and the President from getting paid if there's a government shutdown.
The legislation was originally introduced last week by Senator Barbara Boxer (D-CA), and Seantor Bob Casey (D-PA).
In a statement, the Senator said that under current law the salaries for members of Congress and the President are "held harmless" if a shutdown occurs - meaning they would continue to be paid.
Stabenow says the bill she's cosponsoring would put Congress and the President on "equal footing" with the Americans who would be affected by a shutdown:
"A shutdown could disrupt Social Security checks, veterans' benefits, hold up exports and cost private sector jobs, and will stop paychecks for hundreds of thousands of people. It's only fair that Members of Congress' paychecks be stopped too."
The statement said the last time the government in 1995, "more than 400,000 veterans saw their disability benefits and pension claims delayed," Social Security and Medicare requests were delayed, passports remained unprocessed, unemployment insurance funding ran out in some states, and "$3 billion in U.S. exports were delayed because export licenses could not be issued, negatively impacting economic growth."
The deadline for a deal is this Friday night. If a deal can't be reached, the government would be forced to shut down.
ABC News reports that Congress might postpone the deadline by "passing a two-week spending measure that would fund the government through March 18th."
Predicting the future can be a dangerous thing. When I was a child in the early nineteen-sixties, I used to watch a television show that predicted how we’d live in the far-off world of 2000.
By then, I was told, our homes would be heated by mini-nuclear power plants in the basement and we’d take our private helicopters to work. Nobody, however, saw the coming of the Internet.
Futurologists have gotten somewhat more cautious since then, but there is something most of them do agree on, which is that days are numbered for libraries as we have known them. Printed products have been moving rapidly to servers and Kindles. While most are still published on paper, this is widely seen as a temporary measure which will last only as long as it takes the old fuddy-duddies to die off.
And priorities are shifting. Last week, the Detroit Public Library announced the layoff of a fifth of their entire staff, or eighty-three employees, at the end of March. The far more affluent suburb of Troy has already voted to close its library. Other libraries across the state are threatened with huge cuts or extinction.
The economy is bad, but why do we feel that we can live without libraries? Here’s what one reader posted on the Detroit Free Press website, spelling several words wrong in the process: “Library’s are fast becoming a thing of the past due to rapid access and information that can be had via the Internet.”
Or, in other words, why would we possibly need a place where books are kept and stored when we’ve got Google? Those who defend libraries mainly do so on the grounds that everybody doesn‘t have a computer at home. The newspaper‘s story about the layoffs talked about all the poor people who come to the library to print resumes and scan the internet for job openings.
Governor Rick Snyder is not a “politician.” He would tell you that himself. I first heard he wasn’t a politician from a bunch of political reporters more than a year ago, who felt he was wasting his money on what they felt was a catchy, but ultimately silly commercial.
This was, of course, the famous “tough nerd” commercial that first aired during last year’s Superbowl. Tim Skubick, the dean of, Lansing political reporters, thought it was likely to backfire.
This is a tough, blue-collar state, he said. Not a place where people voted for guys who called themselves “nerds.”
I didn’t know what to make of all this myself, till I saw Snyder skillfully and with scalpel-like precision, separate himself from the rest of the pack during the primary campaign. Like a veteran racehorse he ran third much of the way, then shot ahead in the final stretch, winning by nine lengths and a hundred thousand votes.
The general election wasn’t even a contest. But there was a lot of skepticism as to how the new governor would actually do with the hurly-burly of governing.
Flint Mayor Dayne Walling spent much of last night address talking about what’s working in his city. But he also talked about what he thinks would help the city deal with a growing budget deficit, ‘shrinking the size of city hall.’ Walling wants to drop funding for some city commissions and eliminate some executive positions.
"My proposed changes would save the city of Flint $6 million over 4 years. Over $15 million dollars over 10 years. Its not the whole solution. But its an important part of it. Its an important part that makes a difference."
The city of Flint wants to cover its $17 million budget deficit by raising funds on the bond market.
It has to get permission from the State Administration Board to do that. So far, the Board has tabled its decision.
If the city can't raise bond money, it might be facing bankruptcy or a state takeover.
You can start by adding $1.2 billion to the state's budget woes by cutting business taxes, or you can leave business taxes alone and deal with the current budget hole the Center estimates at $1.4 billion.
Once you start, your options are to cut, cut, cut (cuts to education, cuts general government, cuts to prison and police, cuts to the public workforce, and cuts to welfare and health care) - or - you could raise taxes.
So far, of the 300 or so people who have participated - raising the Beer Tax is the most popular option.
You may think I am a little crazy, but while I was listening to Mayor Dave Bing’s State of the City address last night, what kept running through my head was an ancient rock and roll song.
An early hit called Chantilly Lace, by a now half-forgotten artist called the Big Bopper, whose main claim to fame is dying in the same plane crash that killed Buddy Holly more than half a century ago.
Rick Pluta, of the Michigan Public Radio Network, filed a report on the protests in Lansing saying they were organized by "public employee unions, and attracted state and local government workers as well as teachers who had a snow day." From Pluta's report:
They’re fighting against anti-union bills sponsored in the Michigan Legislature, and to show support for union rallies in Madison-Wisconsin and Colombus-Ohio.
Sally McNamara is a teacher in the Adrian Public Schools:
"I’m here supporting the children of our state and our nation. Are we in debt? Are we in trouble? You bet we’re in trouble. Is it really hard-working people who are driving us down in the gutters? No. It’s not."
Pluta says dozens of Tea Party protestors also gathered to rally in favor of the proposed budget cuts.
Protestors came to Lansing today to voice their opinion on the proposed cuts by the Snyder administration and to protest bills in the Michigan legislature they see as anti-union.
The Detroit News reports that "unofficial estimates put attendance at close 1,000" people:
After a brief rally and march to the Capitol, members streamed across to the House office building to call on legislators, and about 200 construction workers poured into a hearing room where testimony was to be taken at noon on a bill to repeal prevailing wage requirements.
Members plan to cram the gallery of the House chambers this afternoon where lawmakers are slated to discuss bills that would grant authority to emergency financial managers to toss out collective bargaining contracts.
The Detroit Free Press says the protestors in Lansing were inspired by the protests taking place in Wisconsin:
Many protesters...said they thought Snyder's proposal was an attack on unions similar to a bill being pushed by Wisconsin's new Republican governor. They said they were inspired to turn out by eight straight days of protests that have drawn tens of thousands of people to the Wisconsin Capitol.
The Detroit News reported on Tea Party protestors who turned out in smaller numbers in Lansing today. They're supporting Governor Snyder's proposed cuts and some hope Snyder will take a similar stand on unions that the legislature is taking. From the Detroit News:
Tea party supporters Annamaria Evans of Clarkston, Pat Miller of South Haven and Jack Stone of Lake Orion said they want Michigan to end collective bargaining rights for public employees, just as Walker has proposed in Wisconsin.
Miller, a member of the Southwest Michigan Tea Party Patriots, said he wants to see Snyder get as tough on unions as the Republican-controlled Michigan Legislature is.
Hundreds of outraged union members filled a State House committee room and the surrounding hallways to protest a proposal to eliminate Michigan’s Prevailing Wage law. Many union members people began chanting and banging on the walls of the committee room.
Unions say the law makes sure workers are paid fairly and that union members get work.
Some Republicans want to get rid of the Prevailing Wage law, saying developers and contractors could save money on construction costs by making wages more competitive.
Jeff Mowry, a member of Plumbers and Pipefitters Local 333, says the proposal to get rid of the wage law is not a direct attack on the collective bargaining rights of unions, but it still tries to hurt unions.
"You know, that’s the scary part – everything gets very complicated and very confused but it sure seems like it’s all tied together. And it seems like this is just one piece of a great big puzzle that’s looking to take away our collective bargaining rights, yeah."
Some Republican lawmakers say eliminating the prevailing wage law would save about 10% on construction costs and could create more jobs in the state.
Chris Fischer with the Association of Builders and Contractors gave a presentation to lawmakers on how the state could save money by eliminating the wage law.
Fischer says the chanting was distracting, but he was not deterred.
"It is difficult to make a factual presentation when there’s a lot of white noise in the background. It is disconcerting, but the bottom line is prevailing wage does come at the expense of two things Michigan does not have right now – and that’s jobs and taxpayer dollars."
Union members were told they will be able to testify on the wage law when legislation is before the committee for a vote.
Leaders of Michigan labor unions are fighting proposals in the Michigan Legislature that they say would hurt collective bargaining rights. The Associated Press reports:
The Michigan AFL-CIO said Monday it opposes more than 30 bills pending in the Legislature including those that would give emergency financial managers of cities and schools the power to terminate labor union contracts. Unions representing public employees also are opposing bills that would change how binding arbitration works for police and fire departments.
Michigan AFL-CIO President Mark Gaffney said some of the measures are an "assault" on the collective bargaining process that calls for unions and employers to negotiate contracts.
Well, it’s been four days since Gov. Rick Snyder presented his so-called “atomic bomb” budget, and opposition has started to harden. There are those who are concerned about the poor, largely because of the repeal of the Earned Income Tax Credit.
For example, Detroit Free Press editorial page editor Stephen Henderson said yesterday that this amounts to a “government-sponsored shift of capital away from the most needy citizens to those who are already more comfortable.”
Senior citizens’ groups are upset because the governor wants their constituents to have to begin paying Michigan income tax on their income, just like everybody else does on theirs.
The film industry is screaming about the potential loss of the film credits. The education community isn’t happy with the cuts they’d have to take, though they seem to be bearing them with more grace.
But the interesting thing to me is that none of these groups seems to be offering any kind of alternative plan. They want what they want, but don’t have any kind of broader vision.
Yet something radical does have to be done. The state is running an enormous deficit that has to be gotten rid of, and our old automotive-based economy doesn’t work anymore, not the way it did.
So the question for the critics is, if you don’t like the governor’s plan, what are you going to offer instead?
Governor Rick Snyder travels to Kalamazoo today where he will speak to the Kalamazoo Regional Chamber of Commerce and the Rotary Club of Kalamazoo. He's set to speak at 12:30 p.m. and a question-and-answer session is also scheduled. As the Associated Press reports, it's expected the Governor will spend his time defending the budget proposal he released last Thursday:
Last week, Snyder proposed a $45.9 billion budget that includes spending cuts for schools and getting rid of many personal tax breaks. His plan includes a corporate tax change that would save businesses $1.8 billion a year.
Snyder has been working to defend the plan. Critics say it means that the poor and the elderly, public education and local governments would be the ones picking up the tab for businesses.
Senior aides to Governor Rick Snyder say they don’t expect the massive budget protests in Wisconsin will spread to Michigan. Lieutenant Governor Brian Calley says Governor Snyder’s style is less combative than that of Wisconsin Governor Scott Walker. Calley also says he expects most critics of the Snyder budget will be persuaded to change their minds. He says that’s because tough choices this year will avert the need for more cuts in the future.
“Number one, we’re not going to kick the can down the road. Number two, we’re not going to employ one-time gimmicks and quick fixes and those sorts of things. We’re actually going to fix it so that, take a look at Year Two – this actually does solve the problem so going forth, we can actually spend more time on, where do we go from here? How do we work and grow together?"
Nevertheless, some public employee and retiree groups are trying to organize a protest march on Lansing this week. They oppose a demand for public employees to pay more of their health care costs, and a proposed end to the tax exemption on pension income. Governor Snyder presented his budget proposal to state lawmakers last Thursday.
Governor Rick Snyder (and Budget Director John Nixon) presented the 2011 budget to a joint session of the Michigan legislature yesterday.
Michigan Radio's Jennifer White hosted a call-in show, “Funding Our State,” to take a look at the state of the state’s budget, which is currently facing a 1.8 billion dollar budget deficit for the new fiscal year that begins October 1st.
To find out what this budget means for educators, for finances, for business, and for you, click the link below.
Michigan's budget debate is just getting started. The governor has called for deep cuts and tax increases. The plan has been criticized. But the situation is no where near as passionate as in Wisconsin.
The streets of Madison, Wisconsin continue to be a battleground between Republican state lawmakers and their supporters who want to end collective bargaining for state workers and state workers and their Democratic state lawmaker supporters who oppose it. For several days, the budget impasse has stalled business at the state capitol.
Governor Rick Snyder's budget proposal drew praise and criticism (though slightly more criticism) on Thursday. The budget calls for deep cuts in spending across the board. It also calls for taxing private pensions. The Detroit Free Press described Snyder's budget as 'ambitious, but controversial:
Governor Snyder has given a copy of his $45 billion budget plan to the Associated Press. The AP reports:
Rick Snyder is asking for "shared sacrifice" from everyone from senior citizens to state workers, public schools to city halls as he seeks to make up a huge budget gap with a massive budget overhaul.
Even before Snyder presented the plan to lawmakers Thursday, he was defending it. He says it would put the economically troubled state on sound financial footing.
It would cut spending for schools, universities and local governments while ending many personal tax breaks. It would eliminate before- and after-school programs, cut hundreds of state jobs and ask public employees for concessions.
Governor Rick Snyder will unveil his budget proposal today at 11 a.m. in Lansing. As the Associated Press reports, the proposal is expected to make, "sweeping cuts to spending and gets rid of billions of dollars in special tax exemptions, including those for seniors."
The state faces a projected $1.5 billion dollar budget deficit for the fiscal year that begins October 1st.
Republican leaders in the state Legislature say they want to give Governor Rick Snyder time to roll out his entire budget proposal before passing judgment on pieces of it that have become public.
State Senate Majority Leader Randy Richardville says he’s been briefed on the entire budget proposal and is telling people to be patient.
“We’re a little premature making an evaluation of an overall big picture solution. I commend the governor for not being afraid to take on a tough issue and not being afraid to take on a tough issue, not being afraid to roll out a plan. But this is his day, this is his budget. It’s his time to throw out his plan."
The governor is expected to propose lifting the tax exemption on pensions as part of a plan that will also include repealing the Michigan Business Tax, but replacing only part of the revenue.
The governor will make his formal budget proposal to the Legislature this morning at 11 a.m.
Each Wednesday, Morning Edition Host Christina Shockley sits down with Michigan Radio’s Senior Political Analyst Jack Lessenberry to get an update on state politics. This week, the focus is on Governor Snyder’s budget proposal and what cuts he might suggest.
Report: "Fireworks" over part of Snyder's Budget Plan
Chris Christoff, the Lansing Bureau Chief for the Detroit Free Press, says Governor Snyder plans to "eliminate Michigan's generous income tax exemptions for retiree pensions and IRA withdrawals as part of his budget plan" to be released tomorrow. Christoff wrote "a source familiar with the plan" says doing away with the tax exemption could generate more than $1 billion in revenue. From the Free Press:
Many expect Gov. Rick Snyder to set off political fireworks Thursday when he unveils a budget and tax revision plan he says will be simple, fair and efficient...Perhaps nothing will boom louder than a plan to tax pensions and other retirement income the same as all other income -- at 4.35%.
A Snyder spokesperson would not comment on the "speculation." Doug Pratt, a spokesman for the Michigan Education Association, told the Freep that Snyder will "will hear from a lot of retired employees in this state that are not going to be happy with that one." And an aide to republican State Senator Jack Brandenburg said the plan is "a nonstarter."
The Associated Press writes that Michigan's benefits for retirees are one of the most generous in the country:
The Washington-based Center for Budget and Policy Priorities says Michigan's benefits are twice as generous as those of second-place Kentucky. A retired couple in Michigan can have more than $100,000 of income without having to pay any state income tax...
Political pressure in the past has made it hard to reduce senior tax breaks to help the state's bottom line, even as Michigan steadily loses more to the tax breaks as the number of older taxpayers grows.
Governor Snyder will release his budget plan tomorrow.
Prison staff fear privatization is coming
Almost everything in the state is on the chopping block. There has been talk of privatizing parts of the prison system as a way to save money. The Associated Press says the Governor's budget plan will look at cutting around 10 to 20% out of the state's corrections budget.
State workers in prisons fear that will mean privitization. The Associated Press spoke with United Auto Workers Local 6000 spokesman Ray Holman:
The Prison support staff fear the governor may outsource their jobs to private companies to save money.
"If you're cutting $400 million ... you're going to have to go after something," said Holman, whose union represents tens of thousands of state workers, including prison support staff. "We stand to take a substantial hit."
Former GM exec may return as advisor
The Detroit News says former GM executive Bob Lutz may return to the company as an advisor. From the Detroit News:
General Motors Co. has been in talks with former product chief Robert Lutz about bringing him back as a paid consultant, The Detroit News has learned.
The details were unclear Tuesday, but the 79-year-old Lutz continues to have a close relationship with GM, and the two have been in discussions about formalizing an advisory role, according to sources familiar with the discussions.
Lutz was known as a plain speaking executive at GM who was skeptical of the commercial appeal of electric cars and hybrids. As the Guardian reported when he retired in 2010, Lutz once described global warming "as a total crock of shit."
The Guardian writes that Lutz "predicted the internal combustion engine would reign supreme for at least a further decade, and that it would be "years and years" before alternatives make up even a tenth of the market."
Rick Pluta, from the Michigan Public Radio Network, says the House will likely vote on a repeal of the Item Pricing Law tomorrow. Pluta spoke with the sponsor of the bill, State Rep. Lisa Lyons. She says individual price tags wouldn't be required, but stores would be required to prominently post prices so consumers know how much things cost:
"It does eliminate the antiquated requirement that every item be priced which has been in effect since before I was born, but it also upholds and provides for consumer protections that Michigan shoppers have come to know, expect and they deserve," said Lyons.
The Michigan legislature is a step closer in repealing the state's Item Pricing Law.
The law requires that most items on store shelves carry an individual price tag.
Legislation to rescind the requirement that almost all retail goods sold in Michigan be individually priced cleared its first hurdle in the state House this morning, winning approval in the Commerce Committee on a 16-3 vote. The measure was approved after its sponsors agreed to an amendment that will require retailers to clearly display prices in close proximity to the item for sale.
Governor Syder has said that a repeal of the law will send a signal that Michigan is a business-friendly state. Retailers say the law is antiquated and drives up prices.
The city of Flint did not get approval today from the state for a $20 million bond. The city needs the money to pay its bills.
The state Treasurer’s office asked the State Administrative Board to table the bond request, which it was expected to approve. The Treasurer’s office is concerned that the city doesn’t have a plan to deal with its long-term debt.
Flint Mayor Dayne Walling is optimistic the city will get some help from the state.
“I’m confident the city of Flint and the state Treasurer’s office will work together on a short-term, if not a long-term solution here in the next few weeks.”
Flint faces a multi-million dollar budget deficit. The city has laid off police officers and dozens of other employees and has reached pay cuts with other city unions. But it still might have trouble making payroll in the coming months.
Update 2:50 p.m.:
The State Administration Board put off a decision on the city's budget plan this morning. The city wants to borrow money in the form of $20 million in bonds to cover its budget deficit.
The Flint Journal has an update from Flint City Councilman Josua Freeman:
By the end of this month or next month, the city will only have about $500,000 in cash on hand, Freeman said. That's not nearly enough money to meet the payroll expenses of $1.5 million to $2 million every two weeks, he added.
"If nothing changes and we don’t improve our cash flow, we're not going to have enough money to operate," Freeman said.
If the city cannot make payroll, a state takeover or Chapter 9 bankruptcy might be next.
The city of Flint wants to issue bonds to cover it's $17 million budget deficit, but state officials have yet to green light that plan.
The State Administration Board was scheduled to vote on that plan today, but it appears plans have changed.
The Flint Journal is reporting the Board voted to remove the city's request from its agenda today. The Journal reports that led to a cancelation of a Flint City Council meeting scheduled for tomorrow:
Tomorrow's City Council meeting to discuss a $20 million bond request from the state has been canceled.
The meeting, which was scheduled for 5:30 p.m. at City Hall, was canceled after The State Administration Board voted to remove the city's request from its meeting agenda this morning...That move came at the request of the state treasurer's office...City Council President Jackie Poplar said she was made aware of the situation and had no comment until she receives further information.