State budget invigorates state and residents

As Gov. Gretchen Whitmer outlined in her budget presentation on Tuesday, Michigan is at a crossroads and needs new direction to get on the road to opportunity. And, at the Michigan League for Public Policy, we happen to have an Owner’s Manual for state policymakers to do just that.

Our state is currently a place where our water is putting our health at risk, our schools and students are struggling, our roads are damaging our cars and risking our lives, and our job market and workforce are often at odds. That all needs to change, and that change can start now.

The governor’s budget addresses many of the League’s policy priorities for Michigan residents, including several watershed changes that we have been advocating for nearly a decade or more. That includes a much-needed increase in Michigan’s Earned Income Tax Credit — a bipartisan, pro-work policy and one of our greatest weapons against poverty — and, while we would still like to see it fully restored to 20 percent or expanded further, doubling to 12 percent over two years is a fantastic start.

We also applaud the major investments in education Gov. Whitmer proposed, with funding directed to many of the League’s primary points of emphasis: child care, preschool, literacy and third-grade reading, helping students at risk or with special needs, shifting more School Aid Fund dollars back to K-12 schools, improving access and affordability to higher education for high school graduates, and skills training for adults.

Whether it’s in our motto, on our state quarter, visible on maps, globes and images from space — or, for many Alpena residents, right outside your window — Michigan has always been defined by our water. But, in recent years, “Michigan water” has taken on a negative and deplorable connotation. We can’t ever have a repeat of the Flint water crisis, and we can’t let per- and polyfluoroalkyl substances (PFAS) contamination get any worse, and this budget calls for bold but vital funding to clean up our water and our state’s reputation.

Finally, as an organization, we are constantly — and sometimes singularly — calling for increased revenue to invest in the things our state and people need, whether it’s through opposing tax cuts or calling for more equitable tax changes. And, with that in mind, we are grateful for the governor’s courage to increase revenue and make sure businesses are paying their fair share in her budget proposal.

In 2011, Gov. Rick Snyder and the Legislature drastically shifted Michigan’s tax revenue stream from businesses to individuals, contributing greatly to the declining purchasing power of the state’s General Fund. Gov. Whitmer’s plan to increase the EITC and change business taxes makes good progress to restoring that balance. Raising the EITC also offsets some of the regressivity of a gas tax increase and the League’s concerns around its impact on drivers with lower incomes. Finally, we think the benefits of the raised revenue and investments in this budget — to residents with low incomes and their families, as well as our state as a whole — outweigh a gas tax’s impact.

The governor’s budget proposal is just the beginning of the legislative process, but it is a very important one, especially when it is the first budget of a new governor in a new legislative session. And, as the head of an organization that works closely on the annual state budget, I can tell you that the final state budget is usually the best example of bipartisanship and compromise each year.

Much work lies ahead, but we hope residents like you will stay engaged in the process and share your input with your lawmakers over the next few months. To help with that, the League’s policy experts do a thorough review and analysis of the budget each step of the way to keep residents informed on what’s happening in the Capitol. You can learn more about the Michigan League for Public Policy’s 2020 Michigan Budget priorities and our Owner’s Manual for Michigan policy agenda at mlpp.org.

Gilda Z. Jacobs is president and CEO of the Michigan League for Public Policy.