February 12, 2010
February 12, 2010
In radio address, governor says Legislature needs to return budget by July 1
LANSING - In her weekly radio address, Governor Jennifer M. Granholm today said her budget recommendation for the 2011 fiscal year cuts spending and modernizes the state's tax system while still investing in job creation and education.
"No governor in Michigan history has cut more state spending than I have, and my budget for the upcoming fiscal year continues to reduce spending," Granholm said. "But we cannot create an environment more conducive for jobs and economic growth by only cutting spending. We have to invest in the things that are most critical to attracting and keeping business in Michigan."
"One of the most important needs of a 21st century business is having a 21st century talent pool," Granholm continued. "And that means education. Education directly correlates to job creation. Therefore, despite declining state revenues, my budget recommends maintaining per pupil funding for K-12 education at current levels."
The governor said her budget also addresses declining revenue for the School Aid Fund. She recommends existing sales and use tax rates be lowered from 6 percent to 5.5 percent while broadening the tax base to include other services. The additional revenue would go to the School Aid Fund.
"Job creation is also a priority," Granholm said. "To help all Michigan businesses to invest and create jobs, I'm proposing cutting the Michigan Business Tax surcharge in half next year and completely phasing it out in the following year. These tax changes, when fully implemented, will be revenue neutral."
"I've requested that the Legislature hand the budget back to me by July 1," Granholm said. "Schools, universities and local governments whose fiscal year begins July 1 need to know what the state budget is so they can plan accordingly. So if a budget isn't returned to me by July 1, then my pay and the pay of all legislators should be docked every day thereafter until the budget is done."
The governor's weekly radio address is released each Friday and may be heard on broadcast stations across the state. The address is available for download on the governor's Web site at www.michigan.gov/gov together with a clip of the quote above. The radio address also is available as a podcast on the Web site as well as on iTunes and via RSS feed for general distribution to personal MP3 players and home computers. Links to the audio files and text of today's address follow.
Governor Jennifer M. Granholm
Radio Address - Budget
Full: http://www.michigan.gov/documents/gov/Gov236Full_310946_7.mp3
Edited: http://www.michigan.gov/documents/gov/Gov236Edit_310947_7.mp3
Quote: http://www.michigan.gov/documents/gov/Gov236Quote_310948_7.mp3
Hello, this is Governor Jennifer Granholm.
Two weeks ago, I began outlining my 2010 agenda for Michigan. First, I presented a plan to transform Michigan government that lists 29 ways we should reduce costs and improve efficiency.
My State of the State address was the second part of my agenda: continuing to transition to a 21st century economy through essential steps we must continue taking in economic diversification, job creation and education.
This week, I presented the third and final piece: my state budget recommendation for the 2011 fiscal year which begins on October 1.
This budget cuts state spending while still investing in job creation and education. It modernizes the state's tax system to stabilize funding for schools and to create jobs. And it reforms Michigan's budget process.
No governor in Michigan history has cut more state spending than I have, and my budget for the upcoming fiscal year continues to reduce spending. But we cannot create an environment more conducive for jobs and economic growth by only cutting spending. We have to invest in the things that are most critical to attracting and keeping business in Michigan.
One of the most important needs of a 21st century business is having a 21st century talent pool. And that means education. Education directly correlates to job creation. Therefore, despite declining state revenues, my budget recommends maintaining per pupil funding for K-12 education at current levels.
My budget also addresses the problem of declining revenue for the School Aid Fund. The state sales tax is the largest source of revenue for that fund. Michigan's sales tax is primarily levied on goods, but today more than 66 percent of consumer spending is on services.
So I'm recommending that the existing sales and use tax rates be lowered from 6 percent to 5.5 percent while broadening the tax base to include other services. The additional revenue would go directly to the School Aid Fund.
Job creation is also a priority. To help all Michigan businesses to invest and create jobs, I'm proposing cutting the Michigan Business Tax surcharge in half next year and completely phasing it out in the following year. These tax changes, when fully implemented, will be revenue neutral.
More details of my budget can be found on the state of Michigan Web site at www.michigan.gov/budget
I've requested that the Legislature hand the budget back to me by July 1. Schools, universities and local governments whose fiscal year begins July 1 need to know what the state budget is so they can plan accordingly. So if a budget isn't returned to me by July 1, then my pay and the pay of all legislators should be docked every day thereafter until the budget is done.
Thank you for listening.
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