Lansing makes budget headway

LANSING -- Spending pacts apparently have been struck on school aid, Medicaid spending, prisons and higher education, but it appeared increasingly likely Thursday that state budget talks will go right up to the midnight Halloween deadline.

Sources familiar with closed-door negotiations reported advances Thursday, but no final deal on the outstanding sticking points, including privatizing foster care, slicing money from disease prevention programs and raising hunting and fishing license fees.

The governor's office, the Democratic state House and the Republican Senate must agree to an additional $430 million in cuts to balance the state's books and avoid another partial shutdown of government services.

On the bubble and probably not to be included in the new spending plan are proposed one-time appropriations for three key Detroit arts and cultural institutions: $12 million for the Detroit Zoo, $10 million for the Detroit Institute of Arts and $1.9 million for the Detroit Historical Museum. The spending was to help ease the transition from city operation to oversight by nonprofit groups.

The funding was proposed as an addition to the History, Arts and Libraries budget by House Democrats. Lawmakers said they still may find the money to fund the transition later in the year.

None of the 18 bills comprising the 2008 fiscal year budget that started Oct. 1 has cleared both houses of the Legislature, or even emerged from joint House-Senate committees that are to hammer out final agreements. Scheduled conference committee meetings were postponed another day because Senate Republicans have decided not to participate until a comprehensive agreement is reached on state spending and cuts.

Progress behind closed doors

Senate Majority Leader Mike Bishop, R-Rochester, said through a spokesman that much was accomplished behind the scenes Thursday.

"We made some good solid progress on every aspect of the budget, including community health and human services," said Matt Marsden, Bishop's aide. "As long as things keep progressing, the majority leader says we should be in a good position to pass the budget bills no later than Tuesday."

The House was scheduled to be in session today, but the Senate will not reconvene until Monday. Marsden said senators, meeting in small groups, will be at the Capitol hammering out budget legislation throughout the weekend.

Leslee Fritz, spokeswoman for state Budget Director Bob Emerson, agreed that progress was made Thursday.

"A number of issues that were outstanding are closer," Fritz said. "In some cases, agreements were reached, but some minor details remain unresolved."

She said it's unclear whether conference committees will meet today.

Also Thursday, Gov. Jennifer Granholm's long-standing proposal to eliminate $58.7 million in tuition grants for private college students reemerged.

Five times, Granholm has proposed eliminating private college tuition assistance, but she's been rebuffed by the Legislature each time. The program provides up to $2,100 for tuition for some 40,000 students.

"This program has been and is strongly supported by the Legislature on a bipartisan basis and it's absolutely critical, needs-based financial aid for students," said Ed Blews, president of the Association of Independent Colleges and Universities of Michigan.

Blews said he was "surprised and disappointed" the tuition grants are back on the table and may be sacrificed, since the program was not included in a list of cuts drawn up by the governor and lawmakers as part of the budget-balancing package when they passed tax increases on Sept. 30 and Oct. 1.

Parks programs face deficit

Both sides Thursday reported accord on Medicaid health care funding that would not eliminate programs for 19- and 20-year-olds or caretaker relatives, as had been previously proposed by Republicans. But Republicans pushed for scaling back the Healthy Michigan Fund, a $42 million pot for disease prevention, smoking cessation and other programs.

"We're deeply troubled by that," said Susan Schechter, director of advocacy for the American Lung Association of Michigan. She said the Centers for Disease Control recommends Michigan spend $121 million a year on smoking prevention programs and it spends only $3.6 million. "And now even that meager sum is threatened," she said.

A dispute remains over proposed hikes in hunting and fishing license fees. There's also a "looming" $5.5 million deficit in the parks and recreation programs of the Department of Natural Resources "and we have no way to close that at present," said Ron Olson, director of that division.

DNR Director Rebecca Humphries has outlined cuts that would include the loss of 14 conservation officers, a dramatic reduction in fish stocking in the Great Lakes, and closure of state parks and campgrounds. In 2009, the cutbacks could include 37 of the state's 98 state parks.

The fee hikes would bump the cost of a fishing license from $28 to $31 in 2008 and gradually to $44 by 2013. A deer hunting license would increase from $15 to $18.75 in 2008 and to $33 by 2013.

"We recognize the DNR is forced to make cutbacks," said Michigan United Conservation Clubs Executive Director Dennis Muchmore. "However, many of the proposed cuts eliminate some of the most important conservation and protection programs."

Republicans continue to press for privatizing foster care services. Private agencies now provide 39 percent of foster care, according to the Senate Fiscal Agency. Advocates of privatization say it may save money and improve services. Detractors note the Senate Fiscal Agency reported there are no guaranteed savings and they say privatization would come at the cost of state oversight.

Democrats reported that the unresolved issue is not whether to privatize, but how much to privatize.

An apparent agreement on school aid would increase spending per student by $96, to $7,204 for the lowest spending school districts, and by $48 for the highest spending districts. Overall, public schools would get a 1 percent increase. The same goes for the 15 public universities.

Prison spending would be trimmed by $80 million including the closing of three prisons and a camp. Those closures are already under way. Some 500 inmates who have served their minimum sentences would be released on parole and put on a tether program. Also, a program that allows communities to use prison labor on public works projects would be scratched.

You can reach Mark Hornbeck at (313) 222-2470 or mhornbeck@detnews.com">mhornbeck@detnews.com.