Michigan has taken a big step forward in easing budget woes. On Thursday, Jennifer Granholm signed into law a bill that transfers more than $200 million from a school aid fund surplus into the state’s general fund, which is facing a $300 million deficit this fiscal year.
But lawmakers still need to get rid of a deficit of about $484 million for the budget year beginning on October 1st and they have less than a month to do it.
Michigan Representative John Proos says it’s their constitutional duty to pass a budget by that date.
“It seems like we’re here every year, right down to the last moments; it happens in Indiana, too, so it’s not that unusual that it happens in Michigan,” Proos said. “We certainly have had our share of bad news in the last decade; nearly a million jobs lost, 500 thousand residents from Michigan have left our state–we know that has created some significant problems with Michigan’s budget.”
When it comes to the transfer of cash from the school aid fund to the general fund, Proos says it does not put education in jeopardy.
“The school aid fund is separate from our general fund and there’s about a $370 million surplus into there based upon projected revenues. So that’s good news– that means more people are spending money, with their sales tax revenues helping support our school aid fund. But our general fund revenues are down. That still means that Michigan’s economy is not rebounding the way that we want it to and we’re not seeing the successes of job growth that we would hope to see in our state where we would then see both of those funds do much better. We have to have a balanced budget and with now just a couple of weeks left, we would be facing layoffs and huge challenges to balance the current fiscal year budget.”
Proos said that the general fund will later repay the school fund that money. To hear more of his interview click on the video link above.
