State Budget Targets to Provide More for Education, Personal Tax Relief
An agreement on spending targets by the governor and legislative leaders adds funding to the budget recommendation for fiscal year 2013, with the bulk of the new funding slated for K-12 education and a reduction in personal income taxes.
Governor Rick Snyder, Senate Majority Leader Randy Richardville and House Speaker Jase Bolger emphasized that there is still work to do before the budget is signed, but that the setting of spending targets is a significant accomplishment in moving the process forward.
“I appreciate all the hard work by our legislative leaders,” Snyder said. “The agreement on spending for the 2013 budget makes strategic investments in Michigan’s future and sends another strong signal to our citizens and job providers that we have our fiscal house in order.”
The Snyder administration has been meeting with legislative leaders over the past several days to come to an agreement on spending in light of the revenue estimating conference held last week which projected an additional $300 million in available revenue. The additional revenue is a result of both an increase in revenue as well as savings from a decrease in caseloads within the Department of Community Health and the Department of Human Services.
“State government doesn’t have a single dollar to spend that doesn’t come from taxpayers and we must handle that money responsibly,” Bolger said. “With this budget agreement, people can see the focus on funding classrooms, paying down debt, putting money into savings and providing relief to individual taxpayers.”
Specific highlights if the target agreement include:
- Another $180 million is provided to invest in the school employees retirement system and for further support for K-12 schools.
- A total of $90 million in one-time funding is designated for relief in personal income taxes through a reduction in the rate, an increase in the personal exemption or a combination of the two.
- The balanced budget target agreement provides yet another deposit into the state’s Budget Stabilization Fund (rainy day fund). The additional $10 million will bring the fund balance to just over $500 million, another sign that Michigan’s budget is on solid footing with strong financial practices in place.
- Funding for local revenue sharing is enhanced by $20 million beyond the recommendation, with $10 million in one-time money and $10 million in ongoing funding. The additional support will assist counties and communities in balancing their budgets to provide needed services to citizens.
- An additional $60 million is invested to support home heating assistance through the Home Heating Assistance for the Vulnerable Fund, helping ensure low-income families and individuals have home heating during the cold winter months.
Snyder and legislative leaders are targeting June 1 to finish work on the budget.