Budget makes added investments in roads, education, and other key priorities
June 17, 2015
LANSING, Mich. – Michigan’s fiscal year 2016 budget scheduled to begin Oct. 1 was signed Wednesday by Gov. Rick Snyder, providing the funding for the continued comeback of the state that will grow Michigan even stronger. The investments are focused on serving the state’s 10 million residents while building on a solid foundation for a brighter future.
Snyder signed Senate Bill 133, known as the General Omnibus Bill, sponsored by state Sen. Dave Hildenbrand, R-Lowell. He also signed House Bill 4115, known as the School Omnibus Bill, sponsored by state Rep. Al Pscholka, R-Stevensville. Together the bills provide the total investment plan for the state, which totals $54.5 billion when combined with federal funding.
“We are staying focused on creating a Michigan that will attract job providers, educate our children, protect our residents and resources, all while keeping our fiscal house in order with an eye on the long-term future,” Snyder said. “I am proud of the working partnership we have with the Legislature and our ability to get budgets done on time and without delay so that others depending on state funding can have the information they need to plan their budgets.”
More than 75 percent of the total budget is devoted to education and health and human services. The General Fund budget totals $10 billion and the School Aid budget totals $12.5 billion. A total of $400 million in General Fund is allotted to help repair Michigan’s roads. State funding for K-12 school districts has increased by $1.2 billion from fiscal year 2011.
The bill signing marks the fifth straight year the state has completed the budget in June. The budget includes a deposit of $95 million into the state’s rainy day fund, which will bring the total balance in the fund to more than $600 million by the end of fiscal year 2016, again showing the state’s unwavering commitment to fiscal responsibility.
“It’s the right investment package for the future,” State Budget Director John Roberts said. “The governor had a vision when he took office and this budget again reflects the core budget principles he has always emphasized. The last remaining hurdle is finding a long-term solution for the funding of our roads and infrastructure, which I am confident we can do.”
Another sign of Michigan’s continued resurgence includes an unemployment rate down from over 11 percent in 2010 to 5.5 percent today, with more than 400,000 new private sector jobs. The state’s May unemployment rate matched the national rate for the second consecutive month, marking the first time in almost 15 years that Michigan’s unemployment rate no longer lags behind the national rate.
“Businesses now have a state where they can grow and thrive long into the future, creating an environment where our citizens can find a good job and build a better life here,” Snyder said. “It’s an exciting time to be in Michigan and the momentum continues to grow.”
Snyder reiterated his appreciation for the spirit of cooperation in which the budget was created. That same spirit will serve the state well as the work continues to find a plan to generate revenue for a comprehensive solution to the state’s infrastructure needs.
Specific highlights of the 2016 budget include:
Investing in a Strong Education for Bright Futures
- A total of $11.8 billion in K-12 state appropriations, a $1.2 billion funding increase from fiscal year 2011, providing for an increase in the foundation allowance of $183 million which equates to a per-pupil increase of $70 to $140, with districts at the minimum funding level receiving the maximum increase of $140 per pupil.
- A new investment of $30.5 million for a third grade reading initiative to continue and advance the state’s focus on early education so that Michigan children can read proficiently by third grade. Strategies for the initiative include research-based professional development for educators, increased classroom time spent on reading, and expanded parental involvement in early literacy.
- An additional 1.5 percent for the operations of Michigan’s 15 public universities and an additional 1.4 percent for community college operations. Tuition increases for universities will be limited to 3.2 percent or less in order to receive the funding increase.
- An increase of $70 million for at-risk funding for students across the state, bringing the total to $379 million. Over 90 percent of districts, urban and rural, receive this funding.
- An additional $23.5 million in technology infrastructure funding to help schools meet online learning needs.
Ensuring a Healthier Michigan
- New investments of $917.5 million for the Healthy Michigan Plan to continue expanded Medicaid coverage for nearly 600,000 Michigan residents.
- Total funding of $37 million to expand the Healthy Kids Dental program into the three remaining counties of Wayne, Oakland and Kent for children ages 0 to 12, expanding the number of children who will receive good dental care by more than 220,000.
- Total funding of $1.3 million to implement the findings of the Mental Health and Wellness Commission for the residential treatment of youth.
- An investment of $2.5 million for university autism programs to increase the number of trained service providers and available autism services.
- A total of $85 million in total investments for skilled trades to develop a skilled workforce that will lead the nation. This funding will help bridge the talent gap and better match the workforce needs of Michigan industry and business.
- $10 million for career and technical education and early/middle college programs to allow students to earn a high school diploma and an associate’s degree, technical certification, or up to 60 transferable college credits through dual enrollment;
- $10 million increase for skilled trades training programs, bringing total funding to $20 million;
- $10 million increase for vocational education programs, bringing total funding to $36.6 million.
- A total of $114 million in funding for community revitalization and business attraction efforts.
- A total of $500,000 for the student career planning tool which allows students to make informed choices about career and education options, helping them create an educational development plan prior to starting high school.
- A total of $400 million in General Fund dollars for the state’s transportations systems while work continues to find a long-term funding solution to fix our roads and bridges. This brings total General Fund dollars invested in infrastructure over the last four years to more than $1 billion.
- A total of $29.5 million for building maintenance for state facilities, representing a significant investment in the state’s infrastructure that will prevent higher costs in the future.
- An investment of $65 million in technology to replace and modernize legacy computer systems to improve government efficiency and service to citizens. It includes $2 million to strengthen cybersecurity efforts to protect the state’s computer systems, networks, and critical data from growing threats.
Bolstering Public Safety
- An additional $7.7 million to train 88 new state police troopers and an additional $1 million to train 10 new motor carrier officers, bringing trooper strength to its highest level since 2002.
- A total of $3.4 million for accelerating the resolution of sexual assault cases, including $1.7 million for the collection, submission, and timely testing of all sexual assault kits.
- A new investment of $1.5 million for a new statewide drug policy initiative to assist those with substance abuse problems.
- A total of $500,000 for the prevention of sexual assaults on college campuses.
- County revenue sharing and incentive programs will receive $214.7 million, an increase of $3.5 million, providing for maximum funding allowed under statutory provisions for the eligible counties. Two additional counties are added this year, bringing the total eligible number of counties receiving funding to 76.
- Constitutional revenue sharing payments for cities, villages, and townships are increased by $23.7 million to $783.8 million.
- Funding is maintained at $243 million for eligible cities, villages and townships that meet accountability and transparency requirements. An additional $5.8 million in one-time funds is available for 101 cities, villages, and townships which are eligible to receive a $2.65 per capita payment in the current fiscal year.
- A total of $5 million is continued for financially distressed cities, villages, and townships. This program provides grants for local units that have one or more conditions that indicate probable financial distress. Grants to any city, village, or township cannot exceed $2 million.
Maintaining and Ensuring Fiscal Responsibility
- A deposit of $95 million to the Budget Stabilization (“Rainy Day”) Fund, bringing the projected total balance to $611 million by the end of fiscal year 2016. When the governor first took office, the fund was at a mere $2.2 million.
- Total funding for the school employee retirement system of $893.5 million in the school aid budget, along with $5.2 million for higher education institutions who participate in the Michigan Public School Employees Retirement System (MSPERS). Community colleges receive a total of $69.5 million for their MSPERS costs. This investment provides fiscal relief to schools for retirement obligations and helps ensure retirement promises made to employees can be kept.
Quality of Life
- The focus continues on protecting and enhancing the state’s natural resources by maintaining vital funding for ensuring air and water quality, food and dairy safety improvements, prevention, detection and eradication of invasive species, state park maintenance and a recycling initiative.
Snyder vetoed one line-item appropriation in the budget, saying he disapproved the appropriations in section 1010(1) within the Department of Health and Human Services (Article X) because distribution of lapsed funds to prepaid inpatient health plans exceeds the level of funding needed to meet service levels. A copy of the veto letter is available here.
The bills become Public Acts 84 and 85 of 2015.
For more information on legislation, visit legislature.michigan.gov.
Signed veto letter