budget

Commentary
9:02 am
Tue March 8, 2011

Taxing Credibility

Two plus two equals four. Simple, right? That’s math even a journalist can understand. Unfortunately, the legislature and a large section of the general public doesn’t quite seem to get it.

State government is currently on course to run a huge deficit for the next fiscal year. State budget deficits are illegal, under Michigan’s Constitution. That budget has to be balanced by September 30.

Four months ago, we elected a ton of Republicans to the legislature who pledged they wouldn’t vote for any new taxes, no matter what. We elected a Republican governor who said he was going to deeply cut taxes on business, because he believed that was the only way to attract new jobs and industry to this state.

So we voted for no new taxes of any kind, less taxes on business, and we‘ve got a big budget deficit to start. And now we are shocked, shocked, that the governor is insisting on making huge cuts in state spending.

Well, we shouldn‘t be.

We voted for this. And, we tolerated the last governor, and several different past legislatures, refusing to deal with our problems. We put things off till we couldn‘t do it any more.

And now, we have to fix it. What‘s worse, we have to do this when we are still mired in the effects of the worst recession since World War II. Yes, I know the recession is officially over.

The economists say so, anyway. But hard times are not even close to over in Michigan. The auto industry is never coming back the way it was, and we need a new economy.

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Politics
11:21 am
Mon March 7, 2011

AARP organizing rally to oppose tax on pensions

AARP is organizing a rally to be held in Lansing
nasaimages

Organizers for AARP Michigan say their rally will be held on the east steps of the State Capitol Building on March 15th from 11 a.m. to 1p.m..

From the AARP Michigan blog:

The rally was the brainchild of AARP member and retiree Mary Lee Woodward of Oxford, who launched the effort on Facebook with the help of her daughter.  Woodward says she's heard from thousands of seniors who say new taxes on their pensions and other income will make it difficult to pay their bills. Many also object to elimination of a tax credit for low-income working families, and proposed cuts to schools, universities and local police and fire protection and road maintenance.

State Legislature
10:54 am
Mon March 7, 2011

Pension tax alternatives on the table for legislators this week

Michigan Senators plan to discuss alternatives to a pension tax this week
user lincolnblues Flickr

Michigan legislators are planning to discuss alternatives to Governor Rick Snyder's budget proposals this week.

One hot button issue is Snyder's plan to place a tax on pensions. That tax is estimated to raise $900 million.

It would go a long way in eliminating the state's budget deficit which is estimated around $1.5 billion.

It's angered a lot of seniors, and lobbying groups, like the AARP, are putting pressure on legislators in Lansing to keep the tax exemption on pensions in place (the AARP plans to hold a rally in Lansing on March 15th).

Laura Weber, with the Michigan Public Radio Network reported that Michigan Senate Republicans are meeting early this week to try to come up with alternatives to the pension tax plan.

Weber spoke with Republican State Senator Tory Rocca who said his opposition to taxing pensions is simple:

"It’s a tax increase, and on top of that it’s a tax increase on senior citizens, and if you look at what their cost of living is and what their cost of living increases are, they tend to have a higher cost-of-living increase than other people because a lot of their cost-of-living is weighted toward health care, which does increase at a rate greater than the rate of inflation every year."

The Associated Press reports that State Senate Majority Leader Randy Richardville didn't say whether Snyder's pension tax plan had enough support to win approval.

But he did say that if legislators want to scrap the tax plan, they'll have to find money elsewhere. From the AP:

Richardville said that if the Senate opposes pieces of Snyder's proposal they will have to balance it out by cutting programs or finding revenues somewhere else within the budget.

That's $900 million more, which could mean more proposals out of Lansing for bigger cuts.

Investigative
10:05 am
Fri March 4, 2011

State income tax on pensions

Seniors drawing pensions could be taxed under Governor Snyder's new tax proposal.
Flickr

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.

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State Budget
5:12 pm
Wed March 2, 2011

College presidents weigh in on budget cuts

University Presidents were at the Capitol Building Wednesday in Lansing, MI
Thetoad Flickr

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.

State Budget
12:10 pm
Wed March 2, 2011

Lawmakers to dig into Governor's budget proposal

Captiol Building, Lansing, MI
Matthileo Flickr

Update 12:08 p.m.:

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.

6:57 a.m.:

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.

Meanwhile, Governor Snyder spent yesterday defending some of his controversial budget plans, including the taxing of pensions.

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Politics
10:22 am
Wed March 2, 2011

Michigan Works funding at risk

Michigan Works provides job training and education grants to people looking to get back to work
Mr. Juniho flikr

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?

Sarah Alvarez - Michigan Radio Newsroom

Politics
5:31 pm
Tue March 1, 2011

Snyder defends budget and tax plans

Rick Snyder campaigns last year. Now, Governor Rick Snyder is having to campaign for his budget proposals.
Bill Rice Flickr

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.

Politics
1:54 pm
Tue March 1, 2011

Bill: No paychecks for Congress if government shuts down

Senator Debbie Stabenow (center) is cosponsording legislation that will prevent members of Congress and the President from being paid if the government shuts down.
stabenow.senate.gov

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."

Commentary
9:07 am
Tue March 1, 2011

Why Libraries Matter

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.

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Commentary
8:53 am
Mon February 28, 2011

A Natural at the Game

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.

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News Roundup
9:34 am
Fri February 25, 2011

In this morning's news...

Snow

More snow on the heels of more snow is bringing up talk of records in Michigan.

For the Detroit area, NOAA lists 1908 as the snowiest February on record when 38.4 inches fell in the area.

The Detroit News says this winter has been the second snowiest on record with a total of 30.3 inches falling in February.

The News spoke with Karen Clark, a meteorologist with the National Weather Service:

Clark said she doesn't think the rest of the month will be snowy enough to break the record. "Let's hope not," she said. "That would be a lot of snow in the next few days."

The Detroit News has some historical photographs of snowstorms past in an article from 2002.

What snow storms do you remember most? The blizzards of 1978 and 1979 come up a lot in our office.

Fighting for Film Incentives

Groups met last night to push the Michigan Governor and Legislature to reconsider cutting the Michigan Film Incentive tax credits.

As Michigan Radio's Sarah Hulett reports, Michigan has the most generous tax credit in the nation at 42%.

Hulett covered a group meeting last night in metro-Detroit:

The message people need to deliver to Lansing, said Detroit Free Press columnist Mitch Albom, is that the credits have created a rare bright spot in Michigan’s economy:

"This is not about saving Tom Cruise. This is about saving Tom Farmington Hills, and Tom Novi and Tom Detroit."

Hulett reports that "Governor Snyder wants to get rid of the tax credit and replace it with a program worth $25 million a year."

Here's a video of the meeting last night from Fox 2 News in Detroit:

Thousands Gather at Film Industry Town Hall: MyFoxDETROIT.com

Shrinking the City of Flint

Flint Mayor Dayne Walling gave a "State of the City" address last night, and like much of the state -  and the country, for that matter - Walling talked cuts.

Michigan Radio's Steve Carmody covered Walling's address:

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.

Economy
10:46 am
Thu February 24, 2011

Why don't YOU fix the state's budget woes?

The Center for Michigan wants you to play their game.
Image from the Center for Michigan's website

Try your hand at fixing the state's budget problems.

The Center for Michigan has released an interactive state budget calculator - YOU Fix the Budget.

The idea is similar to the New York Times interactive budget calculator for the federal government.

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.

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Investigative
10:27 am
Thu February 24, 2011

More cuts to public universities?

Governor Snyder's budget calls for further cuts to public universities.
user dig downtown detroit Flickr

For eight years, year after year, the state of Michigan has been cutting the money it distributes among the 15 public universities.

“We haven’t been chiseling around the edges.  We haven’t been making minor adjustments.  We’ve been really making huge cuts.”

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Politics
3:33 pm
Wed February 23, 2011

Governor Snyder talks cuts on public radio call-in program

Then candidate Rick Snyder at the Michigan Republican State Convention in 2010.
Bill Rice Flickr

Governor Rick Snyder was interviewed this afternoon by NPR's Talk of the Nation.

He was asked questions by the hosts and by listeners. You can listen to the entire interview here:

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Commentary
12:30 pm
Wed February 23, 2011

State of Detroit

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.

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Politics
4:28 pm
Tue February 22, 2011

Protests in Lansing

The Capitol in Lansing
Lester Graham Michigan Radio

Update 4:28 p.m.

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.

1:41 p.m.

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.

Some of the signs spotted in Lansing:

  • "Recall Snyder"
  • "Don't Tax Grandma"
  • "Get Back to Work"
  • "I'm Not Getting Paid to Be Here"

And some of the chants:

Politics
3:22 pm
Tue February 22, 2011

Union members protest changes to Prevailing Wage law

The Michigan House of Representatives. Union members protested today in a State House committee room.
Lester Graham Michigan Radio

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.

Politics
12:04 pm
Mon February 21, 2011

Unions to fight proposed state laws

As protests in Wisconsin continue, leaders of Michigan labor unions fight proposals in the Michigan Legislature
Mark Danielson Flickr

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.

Union leaders also said they are concerned about some budget proposals from Republican Gov. Rick Snyder, including measures they say hurt schools, the middle class and low-income residents.

Commentary
10:35 am
Mon February 21, 2011

Budget Alternatives

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?

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