June 24, 2004
June 24, 2004
LANSING – Governor Jennifer M. Granholm today signed legislation that will help resolve million dollar deficits in Michigan’s current and upcoming budgets and ensure that thousands of Michigan’s most vulnerable residents will continue receiving important health care services.
Public Act 164 of 2004 raises Michigan’s cigarette tax by 75 cents per pack beginning July 1, with all resulting revenues dedicated to Michigan’s Medicaid Benefits Trust Fund for the remainder of the current fiscal year and for the fiscal year that begins October 1. In Fiscal Year 2005, all of the funds will be dedicated to the Medicaid Benefits Trust Fund, with 75 percent going to the trust fund beginning in the Fiscal Year 2006. The remaining 25 percent will be earmarked for the general fund.
"This is a victory for every Michigan resident who is concerned about health care for our vulnerable citizens and reducing our overall health care costs," Granholm said. "This is an important first step to ensuring that seniors, children, and persons with disabilities will continue to get critical health care services. We are also ensuring that the number of people choosing to smoke will decline over time, thereby reducing the money we must spend annually to treat the effects of smoking-related illnesses."
The cigarette tax increase is expected to generate an additional $97 million in the current fiscal year and approximately $313 million each year thereafter.
Granholm applauded Senate Majority Leader Ken Sikkema, Senate Democratic Leader Bob Emerson, Speaker Rick Johnson, and House Democratic Leader Dianne Byrum for their leadership on this important first step to resolve the state’s budget deficit and said she is encouraged they stand ready to work for a comprehensive budget solution.
"Putting our financial house in order is not a partisan issue," Granholm said. "It’s clear that all of us – the House, the Senate and the Governor’s Office – agree that a healthy population is important for our families and our economy. If we can encourage people to quit smoking and live healthier lives, that’s good for our citizens; it’s good for the businesses that employ them; and that is good for Michigan."
