Bridging wide chasms: Breaking down the House and Senate FY 22 Budgets

For a third year in a row, the Michigan budget preparation cycle remains unusual. As expected, differences on spending priorities and public policy exist throughout the budget process. However, while revenues have improved and broad, less restricted federal aid has been made available, political tensions early in the process continued to compound these wide differences between the Governor and legislative chambers.

Both the Michigan House and the Senate have moved FY 22 budgets that do make some improvements in key areas but continue to underfund vital programs, fail to adequately address the real disparities–health, educational, and economic–that have become even more evident throughout the COVID-19 public health crisis, and play politics with budget needs.

Recent news of a bipartisan agreement around budget conversations and improved revenues provide hope that productive conversations will result in a budget that shows Michigan’s values. With the improved revenues and federal aid from the American Rescue Plan Act, policymakers should take this once-in-a-generation opportunity to address the challenges faced by Michiganders before, during and after the COVID-19 public health crisis.

At this point, House and Senate budget leaders and the Administration will negotiate targets and priorities. Conference committees will meet on final budget recommendations resulting in a straight up or down vote in both legislative chambers. Statute requires the legislature to send a final budget to the Governor by July 1st. There are still chances for advocacy at each of these steps.

BUDGET UPDATES 

HEALTH

2022 Health Budget 

Wages for direct care professionals: The executive budget proposal included an increase of $110 million ($54.7 million in state general funds) to make permanent a $2 per-hour wage increase first provided in March, 2020, for direct care workers serving Medicaid-enrolled seniors in nursing homes and other home and community-based programs.

  • House: The House did not adopt the governor’s recommendation, but added a $100 placeholder to ensure further debate through the joint House/Senate conference committees.
  • Senate: The Senate provides $210 million ($94.5 million in state funding) for full-year funding for a $2.35/hour wage increase on an ongoing basis, and expands the wage increase to adult foster care workers and those working in supportive employment programs. Also included is a $2.00 per hour increase for front line workers in child welfare caring institutions.

Behavioral health: Gov. Whitmer proposed: (1) an increase of $91 million ($30 million in state funds) to meet the requirements of a legal settlement (KB v Lyon lawsuit) related to Michigan’s failure to provide needed intensive home and community-based mental health services for children and young adults; and (2) $26.5 million ($5 million in state funds) for a two-year project to establish 14 community behavioral health clinics across the state to provide integrated behavioral and physical health services for an estimated 100,000 adults and children.

  • House: The House: (1) provided no funding for children’s behavioral health services under the KB v Lyon lawsuit; (2) concurred with the governor and fully funded the Community Behavioral Health Clinic demonstration program; and (3) included $2.3 million to direct community behavioral health supports to crisis stabilization units and psychiatric residential treatment facilities.
  • Senate: The Senate: (1) assumed that the funding for complying with the KB v Lyon lawsuit would be phased in and provided $45.5 in the 2022 budget; and (2) agreed with the governor on the Community Behavioral Health Clinic demonstration program.

Maternal and child health: The governor included: (1) full-year costs and expanded supports under the Healthy Moms, Healthy Babies Initiative; (2) $7.4 million to expand home visits to 1,000 parents with infants at-risk due to exposure to substance abuse, along with funds to increase program navigators to help parents find the right programs and mental health supports; and (3) an increase of $5.1 million to continue the expansion of postpartum Medicaid coverage from 60 days to 12 months. Medicaid covered over 41% of births in 2019, with the highest percentages in both rural and urban areas of the state. The loss of Medicaid coverage contributes to high rates of maternal mortality.

  • House: The House: (1) agreed with the governor on full-year funding for the Healthy Moms Healthy Babies Initiative; (2) agreed with the governor on a $7.4 million expansion of home visiting services; and (3) rejected the governor’s proposal to continue to provide Medicaid postpartum care for one year, reverting to 60 days of coverage for a total reduction of $15.5 million.
  • Senate: The Senate: (1) agreed with the governor on full-year funding for the Healthy Moms, Healthy Babies Initiative; (2) agreed with the governor on the expansion of home visiting for infants and families; and (3) agreed with the governor to continue to cover Medicaid postpartum care for 12 months.

Services for older adults: The governor provided: (1) $37.5 million ($9 million in state funds) in one-time funding to raise rates for Medicaid long-term care/nursing homes; and (2) $19.1 million ($5.3 million in state funds) for the MI Choice program that allows seniors to receive health services at home or in the community rather than in a nursing home—opening up 1,000 slots.

  • House: The House: (1) agrees with the governor on the nursing home rate increase, relying on federal relief funds; and (2) concurs with the governor on the MI Choice expansion.
  • Senate: The Senate: Rejects increased Medicaid rates for long-term care/nursing homes; and (2) agrees with the governor on the MI Choice program expansion.

Initiatives to promote health equity: The governor included funding for several initiatives to address the drastic racial and economic health disparities which were magnified by the COVID-19 crisis, including; (1) $6.7 million to expand services for sickle cell disease for adults who have aged out of Children’s Special Health Care Services, but are not eligible for Medicaid; (2) $8.4 million for community navigators and other technology to help improve access to health coverage and screen for health-related social needs; and (3) $2.5 million to establish a Race, Equity, Diversity and Inclusion Office in the MDHHS.

  • House: The House: (1) rejected the governor’s expansion of funding for sickle cell disease coverage; (2) also rejected the governor’s proposals to increase community navigators and other supports to screen for health-related social needs; and (3) did not include funding for the Office of Race, Equity, Diversity and Inclusion.
  • Senate: The Senate: (1) delayed the extension of sickle cell disease coverage to adults until April 1, 2022 (total spending for 2022 of $3.3 million); (2) included a $100 place-holder for the community-based navigators and related health data improvements; and (3) did not provide any funding for the new Office of Race, Equity, Diversity and Inclusion in MDHHS. The Senate did include an increase of $4.4 million for multicultural services.

Lead poisoning prevention and treatment: In the current year, $2 million was approved to establish a Lead Poisoning Prevention Fund (LPPF) that extends low-cost loans to landlords and homeowners for projects that reduce lead exposure. The governor recommended a one-time increase of $8 million for total funding of $10 million in 2022.

  • House: The House rejected the governor’s proposed expansion in funding for the LPPF, leaving total funding at $2 million.
  • Senate: The Senate also rejected the expansion.

Energy and weatherization: The governor also provided $5 million for a pilot program that supports repairs to prepare homes for participation in  energy efficiency programs.

  • House: The House included a $100 placeholder to allow further discussion in the joint House/Senate conference committee.
  • Senate: The rejected the governor’s recommendation.

2021 Supplemental Budgets

House Supplemental (HB 4419): 

Services for older adults: The House supplemental budget for 2021 includes increases in federal funding related to COVID-19, including: (1) $4.5 million to support family caregivers caring for older individuals at home; (2) $14.5 million for supportive home and community-based services for older adults at home, help facilitate COVID-19 vaccinations, and services to address extended social isolation; (3) $1.4 million for preventive health services related to COVID-19; and (4) $15.8 million for congregate and home-delivered meals for seniors.

COVID-19 Immunizations and Testing: The House supplemental includes $184.4 million in federal funding for COVID-19 vaccinations, as well as $558.1 million for testing, contact tracing and containments, with $300.8 million directed for school testing capacity and costs.

Senate Supplemental (SB 36): 

Services for older adults: The Senate includes $8.5 million for congregate and home-delivered meals, aging nutrition services and aging community services.

COVID-19 Immunizations and testing: The Senate includes: (1) $347.3 million in Federal  COVID-19 testing and laboratory capacity grant, with $20.0 million be allocated to public and nonpublic K-12 schools and Intermediate School Districts, and $20.0 million for the Department of Corrections; (2) $4.1 million for COVID-19 immunization and vaccine grant supports.

Behavioral health: The Senate includes: (1) $6.6 million for community behavioral health clinics; (2) $34.8 million for the substance use disorder block grant; (3) $32 million for the mental health block grant, and $36.4 million for the federal opioid response grant.

Grants to nursing homes and hospitals: The Senate includes $100 million in grants to nursing homes, and $160 million in grants to hospitals, with funds to be used to cover costs related to the pandemic.

HUMAN SERVICES

2022 Human Services Budget

Food assistance: The number of families receiving food assistance rose by 30% in the earliest months of the COVID-19 pandemic as thousands lost work, peaking at 811,099 in May of 2020. By March 2021, the number of families receiving food assistance was still 14% higher than pre-pandemic. The governor’s budget includes an increase of $1.3 billion in federal funds to recognize higher caseloads, as well as a 15% increase in supplemental food benefits for students who have temporarily lost access to free or reduced-price school meals due to COVID-19, as well as the extension of the 15% increase in food assistance benefits for all recipients.

  • House: The House agreed with the governor.
  • Senate: The Senate agreed with the governor on food assistance caseloads and spending.

Income assistance: The need for basic income assistance from the Family Independence Program (FIP) doubled in the early months of the COVID-19 pandemic, with a peak of 71,903 recipients in May of 2020—despite Michigan’s very stringent eligibility policies and low monthly grants. Since that time, the number of recipients—most of whom are children who live in deep poverty—has declined, with a monthly average of just 33,689 during the first 6 months of the 2021 budget year. The governor’s budget included a drop in spending of $33.4 million to reflect a projected decline in the number of families receiving assistance from 23,998 to 15,717.

  • House and Senate: The House and Senate agreed with the governor.

Improving access to human services: The governor included $3.5 million to expand efforts to enroll public assistance recipients in all other programs that they are eligible for, including outreach efforts and changes to the MI Bridges online enrollment system.

  • House and Senate: The House and Senate did not support the governor’s recommendation.

Child Welfare and Justice

Family Preservation: The governor included an increase of $9.2 million ($4.8 million in state funds) for family preservation programs to try to keep children out of foster care.

  • House: The House included a $100 placeholder to continue discussions at the joint House/Senate conference committee.
  • Senate: The Senate agreed with the governor and included language requiring that the DHHS maintain funding levels for the Families First, Family Reunification, and Families Together Building Solutions family preservation programs as of September 30, 2021.

Funding for Raise the Age to keep 17-year-olds out of adult courts: The governor included $29.1 million ($24.2 million in state funds) to cover the costs of a new law that raises the age of juvenile court jurisdiction from 17 to 18 years of age, keeping youths out of adult court and allowing them to get appropriate rehabilitation in the juvenile justice system.

  • House: The House agreed with the governor and provided full funding of $29.1 million.
  • Senate: The Senate assumed that the funding would be phased in and provided only $14.6 million.

2021 Supplemental Budgets

House 2020-21 Supplemental (HB 4419): 

Food assistance: The House bill includes $734.9 million in federal funding to support a 15% increase in monthly food assistance benefits through September 30, 2021.

Energy assistance: The House supplemental budget bill includes $103.2 million in expanded funding for additional home heating and weatherization supports for families with incomes at or below 150% of poverty.

Child welfare: The  includes $10.2 million in federal funding for the Chafee Foster Care pro-gram that helps youths transition out of foster care, as well as $2 million for the Promoting Safe and Stable Families grant, $2.9 million for child abuse and neglect prevention, and $7.1 million for community-based child abuse prevention grants.

Senate 2020-21 Supplemental (SB 36): 

Emergency rental assistance: The Senate budget includes $378.3 million in federal relief funds for emergency rental assistance.

Food assistance: The bill includes $726.4 million in federal funding for the food assistance program.

Child welfare: The supplemental budget includes additional money for the Chafee foster care program ($10.2 million), and Promoting Safe and Stable Families ($2 million).

CHILD CARE AND EARLY EDUCATION

2022 Child Care and Early Education Budget

Child care subsidies: The governor proposed the following for 2022: (1) an increase in the entry eligibility level for child care assistance from 150% of poverty to 200% of poverty until September 2022, dropping back to 160%; (2) elimination of family contribution copays until September 2022; (3) a permanent 10% provider rate increase; (4) reinstatement of provider payments based on enrollment rather than attendance until December 2021; (5) additional grants to providers in 2021; and (6) funding to continue providing social-emotional consultants for child care providers in 2022.

  • House: The House also included most of the new federal ARPA dollars for child care in a supplemental budget bill described below. The House passed a quarterly 2022 budget for the Michigan Department of Education where the child care subsidy is administered, with few details on child care.
  • Senate: The Senate included most of the new federal ARPA dollars in a supplemental budget described below. In the 2022 budget, the following were funded: (1) a permanent increase in eligibility from 150% of poverty to 160%; (2) a permanent increase in the hourly rates paid to providers of 15%; and (3) a reduction in the current bi-weekly block payments to providers to two full-time and part-time payment schedules.

Great Start Readiness Preschool Program: The governor recommended the first increase in per-child payments for the GSRP since 2014. While Michigan expanded funding for the GSRP by $130 million between 2014 and 2015, per-child payments have remained stagnant. The governor proposed an increase of $32.2 million to raise the allocation for a full-time preschool slot by $1,025 to a total of $8,275—mirroring the minimum K-12 per-pupil payment, and increasing GSRP spending from $249.6 million to $281.8 million.

  • House: The House increased GSRP funding by $31.5 million, with funds used to raise the per-child allocation for a full-time slot from $7,250 to $8,211.
  • Senate: The Senate agreed with the governor to increase the per-child full-day slot payment from $7,250 to $8,275 for total spending of $281.8 million. The Senate added language allowing 3-year-olds to be eligible for GSRP—if services to 4-year-olds are prioritized. The Senate also allows programs to use funds to support children in blended prekindergarten/kindergarten classrooms.

Early-On: The governor recommended ongoing state funding for Early On, the state’s program to identify and serve young children ages 0-3 with developmental delays or disabilities.

  • House and Senate: The House and Senate agreed with the governor.

2020-21 Supplemental Budgets

House Supplemental (HB 4419): 

Child care assistance: The House supplemental authorizes a total of $767.6 million in federal funds through 2023, including $292.1 million from the Coronavirus Response and Relief Supplement Appropriations Act (CRRSA), $439.2 in under the American Rescue Plan Act (ARPA), and $36.3 million in federal child care carryforward dollars.

  • Eligibility: Increases to 180% of poverty until September 2022, and then drops back to 160% ($95.6 million).
  • Copays: Waives family contribution copays until September 2022 ($19.5 million).
  • Rates: Increases provider rates by 70% until September 2023 ($518.4 million).
  • Pay by enrollment: Provides payments to providers based on enrollment rather than attendance until December 2021 ($74.8 million).
  • Grants: Provides grants to providers in 2021 ($55 million).
  • Social-emotional consultants: Provides continuation funding in 2022 for social-emotional consultants for child care providers caring for children with disruptive behaviors and difficult family situations ($1.5 million).

Child care stabilization: The House supplemental budget also provides for over $700 million in child care stabilization grants to child care providers to cover operating expenses—funded by ARPA. The grants would be implemented by the Michigan Department of Education.

 Senate Supplemental (SB 36): 

Emergency rental assistance: The Senate supplemental budget also appropriates the funds for child care stabilization grants to providers. The bill provides monthly grants to support operational expenses, including $3,000 for centers, and $1,500 for group and family homes. The bill requires that, as a condition of receiving the grant, providers agree that at least 50% of the funding will be used to reduce tuition, fees and co-pays charged to families.

K12 SCHOOL AID/EDUCATION

2022 K-12 School Aid/Education Budget

Per-pupil spending: The governor recommended an additional $203 million to increase per-pupil allocations for school districts by between $82 and $164—using a 2X spending formula that gives more to districts with the lowest state funding. Under the governor’s proposal, the minimum per-pupil foundation allowance would be $8,275, and the target would be $8,611. The governor also proposed $200 million to stabilize schools with declining enrollments. Despite increases in per-pupil spending in the last several years, when adjusted for inflation, per-student funding in Michigan fell 9% between 2008 and 2019, and falls well below the levels recommended by the bipartisan Michigan School Finance Research Collaborative .

  • House: The House included an additional $125.5 million to increase per-pupil allocations by between $50 and $100, using the 2x formula. Under the House budget, the minimum per-pupil allocation is $8,211 and the target is $8,579. The House budget does not include funding for declining enrollments.
  • Senate: The Senate included an additional $308 million to increase per-pupil allocations by between $125 and $250, also using a 2x formula to increase more equity between districts. Under the Senate proposal, the minimum foundation grant is $8,361 and the target is $8,654. The Senate budget does not include funding for declining enrollments.

Weighted funding formula: The governor continued her push for a weighted school funding formula that recognizes the added costs of teaching children from high-poverty schools or with special needs. For 2022, the governor proposed a total of $14.2 million toward the weighted school funding formula, including: (1) an increase of $12.5 million (2%) for the At-Risk School Aid program, and allowing districts to use up to 10% of their At-Risk funding for pre-K services; (2) a small increase of $260,000 for English language learners (to a total of $13.3 million); (3) an increase of $1.2 million for special education cost reimbursements (to a total of $61.4 million); and (4) a 2% increase ($140,000) for students in rural and isolated districts.

  • House: The House (1) rejected the governor’s proposed increase in At-Risk funding, but expanded eligibility to include prekindergarten, and increased funding for school-based vision and hearing screenings by $1 million, while adding dental screenings as a possible use of the funds; (2) maintained current-year funding for bilingual education; (3) retained current-year funding for special education cost reimbursements; and (4) increased funding for rural and isolated districts by $342,700. The Senate also added a new appropriation of $50 million for transportation services in rural districts.
  • Senate: The Senate (1) rejected the governor’s proposed increase in At-Risk funding, but agreed that the funding should be available for pre-K services, and also increased funding for adolescent health centers from $8 million to $10 million; (2) increased funding for bilingual education by 3% to a total of $13.4 million; (3) agreed with the governor to increase special education cost reimbursements by 2%; and (4) increased funding for rural and isolated districts by $300,100.

Child nutrition: The governor: (1) maintained current-year funding of $2 million for the 10 Cents a Meal program that provides incentives for school districts and child care centers to purchase locally-grown fruits and vegetables; and (2) eliminated $1 million that is in the current-year budget to help districts forgive all outstanding student meal debt.

  • House: The House: (1) eliminated all funding for the 10 Cents a Meal program; and (2) eliminated funding for student meal debt relief.
  • Senate: The Senate: (1) increased funding for the 10 Cents a Meal program to $4.5 million; and (2) agreed with the governor on eliminating funding for student meal debt.

School mental health services: The governor provided $36.9 million—the same as current-year funding—for behavioral health services for students, including $9.3 million for licensed Master’s level behavioral health providers through child and adolescent health centers, and $25.8 million for mental health services through Intermediate School Districts (ISDs).

  • House: The House increases funding by $4.3 million to a total of $41.2 million, including $13.6 million for child and adolescent health centers and $25.8 million for ISDs .
  • Senate: The Senate maintained current year-to-date spending levels which are a total of $56.9 million, including $9.3 million for child and adolescent health centers, and $45.8 million for mental health services through ISDs.

Third grade literacy: The governor included a total of $57.4 million for early literacy programs, down from the current-year funding of $58.2 million.  Funds are used for professional development for educators, to administer diagnostic tools to assess early reading skills of students in grades K-3, for early literacy coaches in ISDs, and to provide additional instructional time for pupils in grades K-3).

  • House: The House rejected the governor’s proposed increase and provided $55.4 million.
  • Senate: The Senate provided $60.9 million for early literacy, with additional funds focused on supporting teacher leaders who provide peer-to-peer literacy coaching supports, and less funding for additional instructional time.

Out-of-school learning opportunities: The governor included $60 million in her 2022 budget for out-of-school learning opportunities to address lost student learning, as well as efforts to support the well-being of children from preschool through grade 12. Funding is provided to ISDs around the state based on the number of pupils who are determined to be economically disadvantaged. Programs must be held during the summer of 2022, and can include day camps, licensed child care providers, and other community programs. Similar funding was requested by the governor in a 2021 supplemental for this summer.

  • House: The House appropriated $1 million for grants to school districts that have innovative community libraries.
  • Senate: The Senate does not include the governor’s out-of-school learning proposal.

Remediation services: In the current-year budget, $152.4 million in federal relief funds and $10 million in state funds were provided for: (1) in-person summer programs for grades K-8 ($90 million); (2) high school credit recovery programs ($45 million); (3) in-person before- and after-school programs ($17.4 million), and innovative summer or credit recovery programs ($10 million). The governor did not include these investments in her 2022 budget as the federal relief funds were no longer available.

  • House: The House continued the programs, funded with state School Aid dollars.
  • Senate: The Senate agreed with the governor.

Community-based before- and after-school programs: The current year budget includes $5 million in federal relief dollars for competitive grants to community-based organizations for in-person before- and after-school programs for students in grades K-8. The governor did not include that investment in her 2022 budget .

  • House: The House continues the program with $5 million in state general funds.
  • Senate: The Senate agreed with the governor.

Flint water emergency: The governor provided level funding of $8.1 million for services to address the impact of lead exposure in the City of Flint, including $2.4 million for school nurses, social workers and classroom aides; $2 million for early intervention services for children between 3 and 5 years of age; $1 million to enroll children in Great Start Readiness preschool programs regardless of income; $650,000 for nutritional services; and $2 million for interventions and supports for K-12 students. The governor also appropriated $1 million for Educare Flint, a project of the Flint Early Childhood Collaborative that provides high-quality education to children between the ages of 0-5.

  • House: The House agreed with the governor on funding for the Flint water emergency, but did not include $1 million for Educare Flint.
  • Senate: The Senate agreed with the governor on funding for the Flint water emergency.

Partnership Model Districts: The governor included level funding of $6.1 million to support districts that are struggling academically and financially, including $137,400 for the Benton Harbor School District that has established a community engagement advisory committee.

  • House: The House eliminated all funding for the Partnership Model Districts.
  • Senate: The Senate agreed with the governor, with total funding of $6.1 million.

Dropout and attendance recovery: In the 2022 budget, the governor continued funding drop-out recovery programs at $750,000, and eliminated current year funding for attendance recovery.

  • House: The House agreed with the governor on dropout recovery funding, but continued $2 million in state funds for attendance recovery.
  • Senate: The Senate agreed with the governor on dropout recovery funding, but increased funding for attendance recovery to $4 million.

Adult education: The governor did not increase the adult education appropriation from its current $26 million, despite the fact that many counties in Michigan lack adult education programs while having need for them. With $10 million more, Michigan could serve 8,000 more students.

  • House and Senate: The House and Senate did not increase the appropriation.

2020-21 Supplemental Budgets

House Supplemental (HB 4421): 

Emergency assistance for non-public schools: The House provides $179.8 million in federal assistance for nonpublic schools through a grant application process administered by the Michigan Department of Education.

Formula grants to school districts: The House provides $4.2 billion to districts based on their Title I, Part A allocations. Districts must use at least 20% of the funds that are from the American Rescue Plan Act ($3.3 billion total) on programs to address learning loss. Districts that receive less than $1,093 per pupil based on their Title I, Part A allocations will receive “equalization” payments to bridge the difference if they offer an average of at least 25 hours of in-person instruction per week from April 12, 2021 through June 4, 2021.

Ventilation systems in schools: The House includes $45 million in federal funding for grants to districts to update their HVAC systems or provide devices to improve air quality. Highest priority for the funds will be given to districts that received the least in other federal relief funds, as well as districts that implement a balanced calendar/year-round school schedule.

Summer programs: The House includes $10 million in federal funding for parents/legal guardians of children who are enrolled in summer programs to cover up to $250 per child to cover costs related to participation.

Attendance recovery: The House includes $6 million (an increase of $4 million) for attendance recovery programs for all districts that opt in.

Adolescent health centers: The House increases funding for child and adolescent health by $20 million in federal funding for total spending of $28 million.

Senate Supplemental (SB 216): 

Emergency assistance to nonpublic schools: the bill includes $86.8 million from the governor’s emergency education relief funding for emergency assistance to nonpublic schools as required by federal law.

Formula grants to school districts: The Senate bill allocates $840.7 million in remaining Elementary and Secondary School Emergency Relief (ESSER II) funding for grants to school districts based on their Title I, Part A allocations.

Summer programs: The Senate supplemental budget includes $10 million in federal funding to provide payments to parents of up to $250 per child to cover costs related to participating in summer programs.

POSTSECONDARY EDUCATION AND TRAINING

University and Community College Operations: Michigan’s disinvestment in postsecondary education during the past twenty years, particularly in the university budget, has resulted in a more than doubling of tuition rates at Michigan’s public universities. Between 2003 and 2015, tuition more than doubled at almost every Michigan university and increased by more than 150% at several schools, far surpassing the rate of inflation. The governor proposed a 2% increase for both university and community college operations, with community colleges funded entirely with School Aid Fund (SAF) dollars.

  • House: The House increased community colleges funding by 6.7%. Does not increase university funding, but instead changes the allocation formula which would result in funding changes to individual universities ranging from -12.2% to 10.1%. The House funds community college mostly, but not entirely, with SAF dollars.
  • Senate: The Senate agreed with the governor’s proposed funding levels, including funding community colleges 100% from the School Aid Fund.

Tuition Incentive Program: Of Michigan’s three needs-based financial aid grants, only the Tuition Incentive Program (TIP) targets households with lower incomes, specifically on eligibility for Medicaid. The governor proposed an increase of $2.5 million for the TIP, but due to a proposed program change to cap reimbursements to institutions, actually decreased TIP funding by $3 million.

  • House and Senate: The House and Senate both included the governor’s $2.5 million increase but not the reimbursement cap.

Michigan Reconnect: Michigan  Reconnect is a new program that provides Michigan residents 25 years old with in-district tuition for coursework leading to a two-year Associates Degree or occupational certificate from one of the state’s 28 community colleges. This current year is the first year that older students have been able to receive college financial aid to attend a public institution since 2010, when No Worker Left Behind was discontinued. The governor provided $120 million, a four-fold increase over the $30 million appropriation for the current budget year, but much of the increase is one-time funding and not a precedent for future funding.

  • House: The House eliminated Michigan Reconnect entirely, leaving Michigan with no financial aid for older students attending a public postsecondary institution.
  • Senate: The Senate continued the current funding level of $30 million.

Futures for Frontliners: The governor’s budget provided $60.4 million for Futures for Frontliners, which provides tuition coverage for a certificate or degree program for frontline workers in acknowledgment of the risks to their health as they worked during the COVID-19 pandemic. The Governor recommended that $25 million of this funding support an expansion of the program to workers who became newly unemployed during November 2020-January 2021 in industries disproportionately impacted by COVID-19. A portion of this funding, $21.3 million, was recommended in the budget year 2021 supplemental to support the frontline workers currently in the program.

  • House: The House eliminated the Future for Frontliners program entirely.
  • Senate: The Senate maintained the current funding level of $30 million.

Wraparound Services: The governor provided $6 million for Michigan Reconnect and Futures for Frontliners Wraparound Services to support enrolled single parents with customized services that will lead to successful completion of their programs. Because such students often experience pressures that traditional students do not, such as working and raising a family or being the first in their family to go to college, wraparound services such as childcare, tutoring, and career counseling can greatly improve their chances of academic success. This amount is added to the $6 million in funding that was included in the Budget Year 2021 MI COVID Recovery Plan.

  • House and Senate: The House and Senate do not provide funding for wraparound services.

CORRECTIONS

Correctional facilities: Michigan’s prisoner population is now at a 30-year low: just under 34,000 prisoners. This decrease of about 4,000 prisoners is a larger-than-typical one-year decrease; the reduction is driven in part by the Michigan Parole Board working to move more people out of the system due to COVID-19. The governor proposed maintaining $1.1 billion to fund 28 correctional facilities across the state. This total factored in a reduction of $14.8 million for facilities funding, which includes the $10.5 million savings seen by the closure of the Detroit Reentry Center.

  • House and Senate: The House and Senate agreed with the governor on funding for correctional facilities.

New staff training and employee well-being: The governor again proposed increasing funding for new custody staff training—this year by $7.4 million, to hire and train 278 new corrections officers annually and address attrition. In addition, the governor included an additional $809,400 to support employees and families, particularly in addressing occupational stress, bringing total funding for employee wellness programming to $2 million.

  • House: The House concurred with the investment in training for new custody staff. In addition, the House included $930,300 and an additional staff position to support expanded employee wellness programming.
  • Senate: The Senate concurred with the governor.

Education, skilled trades and career-readiness: The governor proposed $132.3 million for continuing offender success programs, which help prepare prisoners with vocational and educational skills prior to release, reducing the likelihood of recidivism and helping them to lead stable and fulfilling lives. Specifically, the governor provided $40.3 million in continuation funding for education, skilled trades and career readiness programs.

  • House: The House agreed with the governor regarding continuation funding for education, skilled trades and career readiness programs. The House also increased funding for the Goodwill Flip the Script program by $250,000 and reduced funding for the Public Safety Initiative by $500,000 (both of which fall under offender success programming).
  • Senate: The Senate agreed with the governor regarding continuation funding for education, skilled trades and career readiness programs. The Senate also increased funding for the Goodwill Flip the Script program by $250,000 and added $275,000 in funding for Chance for Life, an evidence-based mentoring program focused on job training and reintegration (both of which fall under offender success programming).

Prisoner health care costs: The governor proposed $312.7 million for continuing prisoner healthcare funding to support prisoners’ physical health, mental health and pharmacy services. This total included maintenance of current-year funding for Hepatitis C treatment and prisoner healthcare services at $8.8 million and $94.8 million, respectively.

  • House: The House concurred with the governor on funding for prisoner health care costs .
  • Senate: The Senate concurred with the governor on funding for prisoner health care costs. In addition, the Senate newly funded the Kalamazoo County Post Release Care Pilot Program at $300,000, which would provide care management post-release (in addition to prerelease mental health discharge plans) for parolees in Kalamazoo County.

FUNDING TO IMPLEMENT CRIMINAL JUSTICE REFORMS

Criminal record expungement reforms (Clean Slate legislation): At the end of 2020, Gov. Whitmer signed the Clean Slate legislation into law, which expands and simplifies Michigan’s criminal record expungement process and automatically clears certain felonies and misdemeanors from criminal records. A criminal record can be a barrier to work, housing, education and other resources, yet having a conviction expunged has been shown to increase the chance of employment and wages. The governor proposed investment across multiple departments including the Departments of the Attorney General, Corrections, State Police and the Judiciary to coordinate the development of criminal record expungement systems. This included $560,000 (GF/GP) in the Department of the Attorney General and $605,000 (GF/GP) in the Department of the Judiciary. In addition, the governor provided $19 million in state restricted funds and an additional $1.1 million GF/GP within the Department of State Police for ongoing maintenance.

  • House: The House concurred with the governor on the funding appropriated for Clean Slate implementation across the Departments of the Attorney General, Corrections, State Police and the Judiciary. However, the House did not include the $19 million in one-time funding for implementation in either the supplemental budget bill or the FY 2022 budget recommendation.
  • Senate: The Senate rejected funding for Clean Slate implementation across the Departments of the Attorney General, Corrections, State Police and the Judiciary. However, the Senate did not include the $19 million in one-time funding for implementation in either the supplemental budget bill or the FY 2022 budget recommendation.

Funding boost to support Michigan Joint Task Force on Jail and Pretrial Incarceration recommendation for behavioral health crisis response training: One of the Task Force’s recommendations was to develop, implement and deliver de-escalation and crisis response training for encounters with individuals who have mental health and substance abuse needs. There is significant evidence to suggest that such training increases safety for both the individual involved and the responding officer. The governor proposed $10.2 million in one-time funding, within the Department of State Police, to support the continued development and delivery of such training for the nearly 19,000 licensed law enforcement personnel across the state—a $6 million increase in one-time funding for the Task Force recommendation.

  • House: The House concurred with the governor on funding the Jail Task Force recommendation.
  • Senate: The Senate rejected the governor’s proposed one-time funding for the Jail Task force recommendation.

INFRASTRUCTURE AND LOCAL GOVERNMENT INVESTMENT

Affordable housing investments: The governor proposed to dedicate $10.0 million to the Michigan Housing and Community Development Program, which is supported by a trust fund to finance downtown revitalization and affordable housing developments. To date, the trust fund has received money only twice–$2.2 million when it was first established in 2008, and $3.7 million in 2012.

  • House and Senate: The House and Senate rejected the governor’s proposed one-time funding to the Michigan Housing and Community Development Program.

Local Government Investments

City, village and township (CVT) revenue sharing: The governor included a one-time 2% increase ($5.2 million in restricted funds) in CVTRS to be distributed to about 587 cities, villages, and townships using the existing formulas. While increasing CVTRS is greatly needed, it is still woefully underfunded as compared to the statutory formula, which is still in law but no longer used. The last time CVTRS was fully funded was over two decades ago, and it is currently funded at only about 27.5% of the full statutory amount.

  • House: The House included a $2.6 million one-time increase in CVTRS funding to provide a 1% increase using the existing formulas.
  • Senate: The Senate included a $5.2 million increase in CVTRS payments to provide a 2% increase but designates the funding as ongoing instead of one-time.

County revenue sharing: The governor proposed to provide county revenue sharing and the county incentive program a one-time 2% increase ($4.5 million in restricted funds) over current year payments and an additional $447,800 to reflect a full year of payments to Leelanau County, which re-entered state-paid revenue sharing in 2021 (Emmet is still drawing from its revenue sharing reserve fund, created in the mid-2000s to help offset state budget declines). Eligible counties would receive a payment equal to 106.6% of statutory full funding. Eligible counties would still need to abide by accountability and transparency requirements.

  • House: The House included a $2.3 million one-time increase in county revenue sharing to provide a 1% increase to eligible counties. The House concurs with the funding for Leelanau.
  • Senate: The Senate included a $4.5 million increase in county revenue sharing to provide a 2% increase but designates the funding as ongoing instead of one-time. The Senate also concurs with the funding for Leelanau.

Infrastructure Funding

High-water infrastructure grants: The governor proposed $40 million in one-time funding for high water level and resilient infrastructure and planning grants. Of this, $30 million would be provided to local governments to address issues such as coastal erosion, flooding, transportation networks, urban heat, and stormwater management. The remaining $10 million would be provided in planning grants to help support the development of local resiliency plans.

  • House: The House did not include the funding.
  • Senate: The Senate included $10 million in one-time funding to be made available for infrastructure needs following emergency situations.

Dam Safety Emergency Fund: The governor’s budget also proposed a one-time $15 million general fund deposit into a Dam Safety Emergency Fund to respond to emergency situations where dam owners fail to properly maintain a dam.

  • House: The House concurred with the governor.
  • Senate: The Senate concurred with the governor on the amount of funding but divided it between a $12 million revolving fund and $3 million in emergency response.

MI Clean Water Plan: The governor included an appropriation of the remaining $290 million in the Strategic Water Quality Initiatives Fund for the MI Clean Water Plan. The MI Clean Water Plan would provide clean water infrastructure grants for purposes such as eliminating sanitary sewer overflows, correcting combined sewer overflows, and increasing green infrastructure; grants to mitigate significant public health risks such as direct and continuous discharges of raw sewage to ground or surface water; and fund a new program to help eliminate failing septic system.

  • House and Senate: The House and Senate did not appropriate the funding.

2020-21 Supplemental Budgets

City income tax offsets: The governor proposed a one-time fiscal year 2021 investment of $70 million to 24 cities that assess local income taxes to offset some of the loss anticipated due to COVID-19. In Michigan, 24 cities levy city income taxes on residents and non-residents working in the city. During COVID-19 these cities were hit hard by high unemployment and workers working from home, as cities cannot collect local income taxes on unemployment income nor from workers working outside of their taxing jurisdictions. The $70 million would be spread proportionately to the amount of income tax collected prior to the pandemic and capped at a maximum of $25 million per city.

  • House and Senate: The House and Senate did not include the funding.

Local Bridge Bundling Initiative: The governor proposed a one-time fiscal year 2021 investment of $300 million in the current budget year to support repair or replacement of about 120 locally owned bridges. The Local Bridge Bundling Initiative would select bridges based on specific criteria. The initiative would cover 100% of the costs, and no local cost share would be required. While including the initiative in FY 2021 would provide enough lead time to plan the projects, construction wouldn’t begin until spring of 2022.

  • House: The House supplemental (HB 4420) included $300 million for the Local Bridge Bundling Initiative.
  • Senate: Neither the Senate supplemental (SB 36) nor the FY 22 budget proposal would include the Local Bridge Bundling Initiative.

 

The post Bridging wide chasms: Breaking down the House and Senate FY 22 Budgets appeared first on MLPP.

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