Here We Go Again, Another Budget Showdown
The chattering sound you've heard in recent weeks is not from teeth reacting to the chill of fall, but from organizations that unexpectedly found their funding torpedoed by Democratic Governor Gretchen Whitmer as part of a budget standoff with the Republicans who have majorities in the Legislature.
In the immediate days after Ms. Whitmer used her executive powers to veto or transfer an unheard of amount of money from a budget -- $947 million in line-item vetoes and $625 million in unilateral transfers via the State Administrative Board – this was the initial reaction from lobbyists and associations trying to reassure their clients and members who saw their funding wiped out:
But now, three weeks into the 2019-20 fiscal year, the lack of a rapprochement between Ms. Whitmer and the Republican legislative leadership – House Speaker Lee Chatfield of Levering and Senate Majority Leader Mike Shirkey of Clarklake – has meant the first real-world infliction of pain. The state transmitted payments Monday to K-12 schools, and that meant charter schools did not receive the $240 per pupil increase traditional public schools received and small school districts in isolated areas went without the set-aside in the budget to assist them.
The transfers already are having an impact too. A program that assists Kent County with foster care is starting to shut down. Organizations that benefit from the multicultural funding line item are starting to rein in their spending and warning they will have to make severe moves if nothing happens by the end of the month.
A deal reached in the coming weeks or months would almost surely restore those funds, but for now, these schools and programs are not receiving funds on which they counted.
The next pressure points come in November when the state usually would disburse funds for the County Jail Reimbursement Program and the Tuition Grant that benefits students on a need basis at private colleges. Then there's more trouble for counties in December when the state usually would disburse payments in lieu of taxes and funds for the Secondary Road Patrol program. Rural hospitals usually would get their funds from the state in December as well.
If this drags all the way until January, then the Pure Michigan tourism promotion campaign will go dark and payments to businesses participating in the Going Pro training program for their employees will cease.
These are just highlights. There's a slew of other programs and organizations wondering what will happen.
Much as was the case leading up to October 1, Ms. Whitmer and the legislative Republicans are waiting to see who blinks. Initially in September, it was Ms. Whitmer who did so, dropping her vow not to sign a budget that lacked a major increase in road funding. But then the Republicans insisted on including short-term General Fund monies for roads in the budget, something Ms. Whitmer has long opposed, leading to negotiations ending/never starting, Republicans sending the budgets to Ms. Whitmer without her input and the governor responding with the avalanche of vetoes and transfers on September 30 and October 1.
Now the sense is Republicans – who do not have the votes to override Ms. Whitmer's vetoes -- will not agree to a supplemental unless Ms. Whitmer agrees to curb, in some way, the powers of the State Administrative Board to unilaterally move money within a department. As an aside, one senses that term limits saved that power during the lame-duck session last year when Republicans went on a spree of bills designed to rein in the powers of incoming Democratic elected officials because no one knew of or recalled the only other time a governor invoked those powers, in 1991.
All this haggling over the State Administrative Board feels more like the Republicans signaling they will not hand Ms. Whitmer a clean victory and let her think she can veto and transfer her way to having the upper hand. Much as Ms. Whitmer's transfers and vetoes were a message to Republicans that if they think can bulldoze the governor into signing budget bills she had no role in negotiating, they've got another thing coming.
Ms. Whitmer, of course, says she will not agree to remove the State Administrative Board's transfer powers. She's promised not to use them in any negotiated budget, but Republicans feel burned and say that's not good enough. What would it take then? A signed, written agreement perhaps? It would be legally nonbinding, but such that if the governor went back on her word her credibility would take a devastating hit.
In the meantime, organizations and programs that rely on the vetoed and transferred funds are watching the days pass on the calendar and getting antsy.Back to top