Michigan governor's budget prioritizes tax cuts, schools

LANSING — Michigan Gov. Gretchen Whitmer on Wednesday proposed a $79 billion budget that aims to substantially invest in schools and public health while cutting taxes for the state's retirees and low-income households. The Democratic governor unveiled the 2024 fiscal year budget during a joint session between the House and Senate appropriations committees.

Whitmer's fifth spending plan in her time as governor comes as the state's surplus is projected to hit its record high, exceeding $9 billion, and Democrats have control of both legislative chambers. If passed, Whitmer's proposal would deposit $19 billion into the state's School Aid Fund and would include a 5% increase in per-pupil funding for schools.

The governor is asking for over $300 million to fund a universal pre-K proposal that would provide free preschool, hire more teachers and fund transportation for the state's 5,600 4-year-olds. “It’s a really encouraging budget,” said Sen. Kristen McDonald Rivet (D-Bay City). “You see really big investments in education, particularly trying to get kids back to where they were pre-pandemic, so everything from tutoring assistance to behavioral/mental health support.” The spending also includes over $300 million for school safety programs and a $160 million plan to provide free breakfast and lunch for all students, which Whitmer said would help families save $850 a year and would make Michigan the fourth state to implement such a plan. Infrastructure was once again a priority for Whitmer, who was first elected using the slogan “Fix the Damn Roads.” Her plan includes $200 million to rebuild and fix bridges across the state and $65 million to expand electric vehicle charging networks. “One thing that I’m absolutely thrilled about is the pretty significant increase in revenue sharing which is a critically important local resource that allows our locals to pay for things like fire and police officers and for people to prepare local roads, which has been underfunded for decades,” McDonald Rivet said. Whitmer also outlined her “Lowering MI Costs” tax relief plan, which Democrats have been unable to pass since it was first announced at the governor's Jan.

25 State of the State speech. The plan would repeal the retirement tax and significantly increase earned income tax credit for low-income households. The governor also announced Monday she plans to send $180 “inflation relief checks” to all tax filers, a plan that would cost $800 million. Senate Republicans have refused to pledge their support for the governor's tax plan, which Democrats would need if they want the plan to apply to the current tax season. “Instead of burning through taxpayer funds, we should focus our resources on putting more of people’s hard-earned money back in their pockets as they face uncertain financial times and skyrocketing prices,” said Rep.

Bill G. Schuette (R-Midland). “We must go through this process responsibly, not in a way that looks to spend more dramatically.” Republican leaders continue to say Whitmer is using the $180 checks to replace an income tax reduction the state's high revenue will automatically trigger. “Democrats want to bribe the people in Michigan with 50 cents a day,” Republican House Leader Matt Hall said Wednesday, referring to the $180 checks.

“What they’re trying to do is eliminate this income tax trigger, which is going to give permanent relief to all people in Michigan.” Whitmer's tax relief plan also included an electric vehicle sales tax cut, which would eliminate sales tax on electric vehicle purchases of up to $40,000, saving up to $2,400 in taxes. After outlining her budget for the 2024 fiscal year, which begins Oct.

1, Whitmer told lawmakers “the ball is in your court" now.