The state of Michigan is already looking to the post-COVID world and how they will pay for everything.
The first hints came Thursday morning as Governor Gretchen Whitmer unveiled her budget plan for the fiscal year 2022.
As with everything in the past year, the weight of COVID-19 hung heavy over the state budget process. Both what it cost the state to fight the pandemic and also a lack of tax revenue as the economy was closed and then slowly re-opened. However, the initial fears weren’t as bad as they turned out to be and that has led Gov. Whitmer to proposing a $67.1 billion budget for next year.
“We’re in a stronger position than what we anticipated because of the crisis that we confronted and the way that we managed through it,” said Whitmer after the budget release.
In total, the plan is $67.1 billion dollars. This includes $11.4 billion coming from the general fund and $14.7 billion coming from the school aid fund.
Whitmer says the plan includes no tax increases but the heavy price comes from federal help this past year.
“My largest concern is the amount of one time dollars in ongoing programs,” said Republican Senator Jim Stamas, the Senate Appropriations Chair, “And how do we continue forward with that?”
“We are mindful that there is some one time funding in here,” said Whitmer, “But this is also a unique moment where we’ve got to really be focused on re-engaging our economy.”
Whitmer releases this plan as she and the legislature negotiate the COVID-19 relief supplemental budget, a separate package but one that could impact this plan.
“If we want to open the economy up and get past the pandemic,” said Democratic Senator Curtis Hertel of East Lansing, “The number one way to do that is to get shots in arms.”
A boosted economy will mean more money to work with and a smoother negotiation between the two sides.
“It’s certainly going to be a opportunity,” said Sen. Stamas, “To look and work together and find solutions.”
Here are more details on the funding layout as provided from the Governor’s office.
Budget Recommendations for Children and Public Education
The budget recommendation calls for the largest investment in K-12 schools in history, including:
• $203 million to increase base per-pupil funding to $8,275 for districts at the minimum ($164 per-pupil increase) and $8,611 for districts at the maximum ($82 per-pupil increase), reducing the gap between the highest and lowest funded districts to $336 per pupil.
• An increase of 2 percent totaling $14.1 million for economically disadvantaged students, English language learners, special education students, and students in rural and isolated districts.
• $250 million in one-time supplemental funding to implement research-based best practices to support student academic recovery, physical and mental health, and post-secondary readiness and transition.
• $200 million one-time for declining enrollment to stabilize budgets for districts experiencing losses in fiscal year 2022.
• $120 million total to provide opportunities in 2021 and 2022 for students through summer learning, after school learning, day camps, and other activities designed to support student needs outside of the normal school schedule.
• Funding for the Education Emergency Relief Fund intended to help mitigate the impact of COVID-19 on students for use in public schools ($38.9 million) and nonpublic schools ($86.8 million).
• $32 million for the Great Start Readiness Program, raising the state payment for a full-day preschooler from $7,250 to $8,275, which is the same as the proposed K-12 base foundation allowance, for 38,000 4-year-olds statewide.
• $55 million for the Filters First program to begin statewide implementation of drinking water fixture replacements in schools to ensure that children have access to clean, safe drinking water.
• $2.9 million to address the educator shortage and provide more supports for current teachers as well as incentives to recruit former and future educators.
• A one-time increase for universities and community colleges equal to 2 percent of operations funding and an additional $70 million in one-time support upon adoption of policies related to COVID-19 testing, quarantining, and contact tracing.
Budget Recommendations for Economic Opportunity
The budget recommendation calls for funding centered on economic recovery and opportunity, including:
• $370 million for the expansion of childcare options providing additional supports for Michigan families by temporarily increasing the income eligibility threshold from 150% to 200% and temporarily waiving out-of-pocket copays through fiscal year 2022, with a 10 percent increase in hourly rates for child-care providers.
• $120 million one-time for the Reconnect program to provide a tuition-free pathway to an in-demand industry certificate or associate degree for Michigan adults age 25 and older.
• $60 million one-time for the Futures for Frontliners program to fully fund the first cohort of essential workers and expand the program to include those newly unemployed from November 2020 to January 2021 in our hardest hit business sectors.
• A $15 million one-time increase for the Going Pro program to expand employer-based training grants that result in industry-recognized credentials and certificates.
• $3 million for pre-apprenticeship/apprenticeship programs that will expand Michigan’s talent pool in the construction and building trades.
• $25 million one-time for the Mobility Futures Initiative to support a new statewide collaboration that addresses environmental sustainability, connected and autonomous vehicle deployment, economic and workforce development, and the alleviation of systemic mobility inequities in underserved communities.
• $1 million one-time for Focus: HOPE to support workforce development, youth development, and community empowerment and advocacy programs.
Budget Recommendations for Public Health
The budget recommendation calls for funding centered on the health of Michigan families, including:
• $360 million for a direct care wage increase to permanently maintain the $2/hour wage increase for direct care workers.
• $38 million for a one-time nursing home COVID supplemental payment to address lost revenue from reduced bed occupancy during the pandemic.
• $91 million to improve access to and consistency of behavioral health for Medicaid enrollees and those served through the child welfare system.
• $26.5 million for the Certified Community Behavioral Health Clinics Pilot to provide integrated behavioral health services to adults in the state.
• $7.4 million to expand the Infant Home Visiting program for evidence-based home visiting services to at-risk families with infants born with substance exposure.
• $3.5 million for cross enrollment expansion to improve technology and communication tools to better identify and enroll individuals needing support and services.
• $19 million for the MiChoice program expansion to provide alternatives to nursing home care by increasing slots for Medicaid Home and Community Based Waiver services (increase of 1,000 slots).
• $6.7 million for the Sickle Cell Disease Initiative to expand treatment coverage to around 400 adults and increase outreach and clinical capacity supporting the estimated 4,000 Michigan residents living with sickle cell disease, which disproportionately affects Black people.
• $8.4 million to reduce health disparities and expand the use of community-based navigators to enhance access to health coverage, and improve screening, data sharing and interoperability of existing data systems through the Michigan Health Information Network.
• $2.1 million for the Race, Equity, Diversity and Inclusion Office to promote racial equity and inclusion in DHHS-administered services.
• $10 million one-time for the Lead Poisoning Prevention Fund to help eliminate lead poisoning in homes by injecting private capital into lead remediation efforts.
• $5 million one-time for a pilot program to promote pre-weatherization construction, renovation, and repair services required to make single and multi-family structures eligible for energy efficiency or weatherization programs.
• $15 million one-time for state psychiatric hospital special maintenance for capital improvements at all five of Michigan’s psychiatric hospitals.
Budget Recommendations for Infrastructure
The budget recommendation calls for investments in the state’s infrastructure, including:
• $300 million for local bridge bundling to repair or replace approximately 120 local bridges in serious and critical condition.
• $290 million in infrastructure grants for the MI Clean Water Plan to address sewer overflows and mitigate public health risks by removing sewage discharge to surface water and ground water and eliminate failing septic systems.
• $40 million to fund high water level and resilient infrastructure and planning grants to local governments for projects that address issues like coastal erosion, flooding, transportation networks, urban heat, and storm water management.
• $15 million for the Dam Safety Emergency Fund for emergency response when dam owners are unwilling or unable to mitigate hazards caused by dam malfunction.
• $20 million to protect the state from cyber threats from hostile entities looking to attack the state’s information technology systems.
Budget Recommendations for Clean Energy and the Environment
The budget recommendation calls for funding centered on the environment, including:
• $20 million for contaminated site cleanup to support rapid response to contaminated sites that pose an immediate threat.
• $5 million for the State Facility Green Revolving Fund which is a catalyst for energy efficiency and renewable energy projects at state facilities, helping reduce the state’s carbon footprint.
• $5 million to support the purchase of propane tanks with funds provided as grants with a 50 percent match to help meet our energy needs.
• $5 million for the Michigan Saves Green Bank to leverage private investment in clean energy improvements by incentivizing lenders to provide more favorable rates and terms for renewable energy improvements, promoting $150 million in private capital for clean energy improvements across the state.