By Allison R. Donahue, Michigan Advance

The GOP-led Legislature took a key step Tuesday toward completing the nearly $70 billion Fiscal Year (FY) 2022 budget, carving out money for criminal justice reform, education and a number of Democratic Gov. Gretchen Whitmer’s programs for workers. 

The legislative Conference Committees unanimously approved both the Higher Education and General Government budgets and outlined the details of how Michigan’s taxpayers’ dollars and influx of federal funds will be spent in the upcoming fiscal year.

“I am thrilled that the Legislature and I were able to come together to agree on a bipartisan budget. Our collaboration is a testament to what’s possible when we work together and put our families, communities and small businesses first,” said Whitmer.

The next fiscal year begins Oct. 1. Whitmer has until Sept. 30 to sign the budget in time to avoid a partial government shutdown. Budget leaders from the governor’s office, House and Senate last week announced they reached a deal on the upcoming state budget. 

The budget bills likely will be on the floor of both chambers Wednesday for final approval and then be sent to the governor’s desk to be signed. 

Part of the FY 2022 budget is already complete. Whitmer already signed the state’s $17 billion FY 2022 School Aid budget in July, which primarily funds K-12 schools.

According to nonpartisan fiscal analyses released Tuesday, the state’s General Fund (GF) totals $10.4 billion for the General Government budgets and $57.3 million for Higher Education. 

“This budget is sustainable moving forward and provides much-needed stability and peace of mind — desperately needed in this time of instability. It’s a fiscally responsible approach that keeps money available for future investments and as a safety net in case of an economic downturn,” said House Appropriations Committee Chair Rep. Thomas Albert (R-Lowell).

As the Advance previously reported Tuesday, the budget includes a temporary $2 hourly pay raise for direct care workers providing Medicaid-funded in-home behavioral health and long-term care services during the COVID-19 pandemic. The budget also allocates $460 million to give a permanent $2.35 hourly raise to direct care workers in nursing homes.

Democrats and Republicans celebrated bipartisan negotiations for the budget.

“I am proud of this budget and the collaboration with the Legislature to create a spending plan centered on transformational investments that will drive Michigan’s continued recovery,” said State Budget Director David Massaron. “This budget is going to help Michigan emerge as an even stronger state and it provides the type of investments that will foster real and lasting improvements to support Michigan’s families and businesses.”  

Albert said the budget is “sustainable” in case the economy worsens again like it did at the beginning of the pandemic.

“Separately, in the months ahead, we will continue to take advantage of the opportunity to make additional one-time investments that will strengthen Michigan for years to come,” Albert said. 

Both budgets were also largely supported by federal COVID-19 relief funds, giving budgets more leeway to support state departments. However, a large portion of the federal dollars were excluded from the FY 2022 budget. 

Once this budget is final, Michigan will have only allocated about $800 million of the state’s $6.5 billion in federal funds. 

Higher ed gets more funding, no penalization for vaccine mandate

In an unusual move, the Higher Education budget was pulled out of the General Government omnibus budget and was voted on separately. 

Senate Majority Leader Mike Shirkey (R-Clarklake) had said funding was a sticking point in the budget negotiation process, as several universities have vaccine mandates, which Shirkey and other Republicans oppose.

Tucked in the boilerplate language of the Higher Education budget are additional exemption and reporting requirements that community colleges and universities must provide if a mandatory vaccine policy is implemented. 

However, public universities enjoy autonomy in Michigan’s Constitution and it’s expected that Whitmer will say the boilerplate language is unenforceable. 

Universities will see a 4% one-time funding increase in the FY 2022 budget, as well as the regular 1% funding boost. Most community colleges will just see the 1% increase.

“That’s the largest increase of my time here,” said Sen. Curtis Hertel (D-East Lansing). “I’m very proud about that. Obviously, we’ve had 30 years of reduced funding for higher education in the state, but this is a step in the right direction.”

Here’s what else is in the budget

The general omnibus bill includes increased funding for a number of Whitmer’s programs aimed to help meet her goal to get 60% of the state’s residents attain a post-high school credential by 2030. The budget includes $55 million for the Michigan Reconnect Program, $25 million for Futures for Frontliners, $40 million for Going Pro and $8 million for the statewide Pre-Apprenticeship Program. 

As the Advance reported earlier, several of Whitmer’s health priorities were funded: $5 million for a pilot program for home weatherization and energy efficiency; $19.1 million for the MiChoice program expansion to provide alternatives to nursing home care;  $7.4 million to expand the Infant Home Visiting program to at-risk families with infants born with substance exposure; $8.4 million to reduce health disparities and expand the use of community-based navigators to enhance access to health coverage and $6.7 million for the Sickle Cell Disease Initiative.

The Legislature increased its own budget by 6.2%, totaling $186.6 million. 

State revenue sharing for cities, villages, townships and counties increased 2%. That funding is often critical for local governments trying to balance their own budgets.

The Department of Health and Human Services (DHHS) will see an increase of more than 10%, totaling $31.7 billion. The Healthy Michigan Plan, the state’s Medicaid program, will receive over $400 million, mostly funded through federal dollars. 

The Healthy Moms Healthy Babies program, a maternal and infant health program, will see an increase of $11.4 million to annualize and expand the program. 

Funding for the Michigan Clean Slate program, which automatically expunges criminal records after seven years for those with no more than one felony or two misdemeanors, is included in several departments part of the FY 2022 budget. 

The budget includes $7 million for the Land and Water Conservation Fund for grants to local governments to develop public recreational land and facilities. 

The Michigan State Police will see a 20% increase in funding, totaling $527.8 million in General Funds, with $3.8 million of that allocated for body cameras and $500,000 for de-escalation training. 

Whitmer’s Michigan Joint Task Force on Jail and Pretrial Incarceration, which provides recommendations on behavioral health crisis response training and support for crime victims, was excluded from the budget.

The Department of Attorney General will see a 4.6% General Fund increase, with a total of $43 million in funding. 

The budget requires the Unemployment Insurance Agency (UIA) to provide quarterly expenditure reports. This comes after the UIA struggled throughout the pandemic to provide unemployment benefits to laid-off Michiganders. 

There’s language requiring the UIA to provide full-time, in-person services at all existing offices. There’s also language mandating that Secretary of State branch offices maintain full-time, in-person services after offering mostly online services throughout the pandemic. 

The Michigan Poverty Task Force will get $1 million in one-time funding for research and planning to increase effectiveness of state benefit programs. 

The budget includes $153 million for the Department of Environment, Great Lakes and Energy (EGLE), which is an 158% increase. 

The Department of Natural Resources budget was cut by 4.1% in General Funds and 1.1% in gross appropriations.

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