Whitmer's $61.9B budget plan boosts environmental spending
Lansing — Gov. Gretchen Whitmer's proposed $61.9 billion budget for the coming year includes more than $100 million to address new and emerging threats to the water and environment, safe school infrastructure and the impacts of changing weather patterns.
At the same time, the state is tightening its belt to prepare to pay settlements related to the Flint lead-contaminated water crisis while balancing ongoing commitments to the city's recovery.
"I tried to make sure that we’ve got a budget that delivers on the fundamentals, keeps our promises and is strong enough that when the bill against the last administration comes due, that we’re in a position to live up to our responsibility," Whitmer told reporters Thursday.
The Democratic governor's focus on present and future environmental threats was one of three pillars emphasized Thursday as budget officials requested that lawmakers increase the budget 4% to $61.9 billion for the 2020-2021 fiscal year.
The budget plan also seeks to increase spending on education, health care and welfare programs, but there was little talk of more road funding after Whitmer convinced a state commission to take on $3.5 billion in debt over 25 years to improve the state’s highways in five years.
The new budget, which Whitmer called "thoughtful," represents a roughly $2 billion increase from last year’s budget, which weighed in at $59.4 billion as of mid-January.
"Our future depends on making strong investments in these core priorities, and while we cannot correct decades of underfunding overnight, particularly in the area of education, this budget builds on last year's budget to provide additional funding in these critical areas," Whitmer said in a statement.
The presentation follows a bumpy first year in divided government that included sparring over Whitmer’s proposed 45-cents-a-gallon gas tax increase, stalled road money negotiations, a delayed budget proposal from the GOP-led Legislature and $947 million in line-item vetoes — some of which were later restored.
Republican legislative leaders indicated they had lingering concerns about parts of this year's spending blueprint.
"There are some areas where we will have to improve upon her agenda, where she continued to pick winners and losers with schoolchildren and rural Michigan families," House Speaker Lee Chatfield, R-Levering, said in a statement.
"But there are also many areas where we all agree and can work together to get things done for the people we serve, including fixing our crumbling roads and the help for shoreline erosion we requested."
Contamination, climate responses
The budget plan requests $64 million for environmental contamination response. About $40 million would go to local units of government to manage changing climate conditions like high water levels, $20 million for rapid response to environmental contamination and $4 million to crack down on chemical contamination. Another $40 million is proposed for schools to upgrade their facilities to create healthier learning environments.
The $40 million for "climate resilient infrastructure" would include $10 million in planning grants for local communities and $30 million for infrastructure grants that address flooding, coastline erosion and other natural phenomena affecting local communities.
"We are uniquely positioned because we have all this fresh water, but we also are going to be confronting some unique challenges because of the precipitation, the global warming and the lack of a real freeze this year," Whitmer told reporters. "We anticipate a lot of extra ground water."
Other parts of the environmental funding included grant programs to eliminate farming runoff and help those seeking renewable energy alternatives.
Whitmer also proposed $10 million be added into the Lead Poisoning Prevention Fund, which functions as a loan loss reserve for private lenders who loan money for private lead remediation efforts. The program ensures below-market interest rates for borrowers
But Budget Director Chris Kolb acknowledged the financial pressures looming over the state's General Fund, including eventual settlements in state lawsuits such as those filed over the Flint water crisis.
Whitmer said she has kept the Legislature "in the loop" regarding the status of the cases, but declined to estimate how much they could cost the state. In the meantime, the state will continue to honor its commitment to the city, she said.
"We are living up to the priority that we set in terms of ensuring that children in Flint have access to remediation, that they have wraparound services in the education space," Whitmer said. "We are living up to those obligations.”
Sen. Jeff Irwin, D-Ann Arbor, said Whitmer is taking “bold action” on clean water with both initiatives and others that could go under the radar.
“In general, the governor has already exercised great leadership on environmental issues,” said Irwin, who was once executive director for the Michigan League of Conservation Voters.
Republicans were guarded Thursday about which of the environmental initiatives they would support.
The nearly $62 billion overall budget is a “substantial jump” over the $59 billion current budget, said Senate Appropriations Chairman Jim Stamas, R-Midland. There are “a lot of unknowns," Stamas said.
Sen. Rick Outman R-Six Lakes, who chairs the Senate Environmental Quality Committee, said he liked the increased funding for decreased phosphorus runoff, which contributes to potentially harmful algae blooms. But the state has to “live within our means," Outman said.
Road and bridge repairs
Kolb was largely silent on road funding, but the administration's new request for $5.3 billion represents a 6% hike. The current $5 billion budget for the Department of Transportation is $2.4 million less than the fiscal year 2019 budget.
The $3.5 billion in bonded dollars don’t have to be appropriated by the Legislature and weren’t included in the latest budget plan. But the resulting revenue can go only to state highway projects, which left Republican lawmakers frustrated that local roads have been left out.
Whitmer said she is not taking her "eye off the ball" of long-term funding. While the bonds allow the state to act where "time is of the essence," the Legislature also needs to propose a long-term plan that includes local roads, she said.
"I remain hopeful that maybe this is the year that we find common ground," Whitmer said. "... But I don’t tilt at windmills. I’m realistic. I put a solution on the table last year. I’m moving forward and I'm delivering on a lot of these fundamentals.”
The new budget proposal includes an additional $205.3 million for road and bridge construction. About $132 million of the amount is required by the Legislature's 2015 road funding plan that required General Fund dollars be dedicated to road fixes.
Republicans said they were happy to see the 2015 law being followed, but some were concerned that the spending blueprint still didn’t do enough.
Last year, majority GOP lawmakers cut other initiatives to free up $400 million for more road and bridge repairs. Whitmer vetoed $375 million but pocketed $25 million for mass transit. Some Republican legislators didn’t rule out adding money for local road improvements.
The state still needs more money roads, especially because the bonds focused on “big projects” in “certain urban areas,” said Rep. Mark Huizenga, R-Walker, a member of the Appropriations Committee. The House GOP caucus would continue to work on it, he said.
“We still have the same issues with roads,” Huizenga said. “We still need to continue to fix them. We still need a long-term solution.”
Schools, health care get big bumps
The proposed budget includes the largest funding increase for classrooms in nearly 20 years, adovacting for a weighted foundation allowance formula and encompasses $60 million in additional funding for special education and $60 million for academically at-risk and economically disadvantaged students.
The education portion also would increase per pupil funding by $150 to $225 per pupil for a total of $8,336 to $8,679 per pupil.
The proposed budget includes a $5 million increase for English language learners, $25 million to pay for teacher’s out-of-pocket supply costs and $35 million for the Michigan Reconnect program for adults seeking a post-secondary certificate or associate degree.
The governor also will advocate for a 2.5% increase for the state’s 15 public universities and 28 community colleges.
Whitmer has proposed $37.5 million to enhance health programs for women before and after birth and for their kids. She’ll also ask the Civil Service Commission to approve 12 weeks of paid maternity and paternity leave for state employees.
Whitmer's plan targets $27.9 million at the skilled trades program Going Pro, whose $37.2 million budget she vetoed last fall, and $15 million to the Pure Michigan tourism campaign, whose $37.5 million budget also was vetoed. The tourism industry was hoping for a full restoration of state support, but the governor's spending blueprint only seeks to restore 40% of the prior funding level.