Senate OKs Budget That Splits With Gov. Whitmer On Roads, Schools

LANSING (AP) — The Republican-led Michigan Senate on Wednesday approved a $58.2 billion spending plan that splits from Gov. Gretchen Whitmer's proposal on big-ticket priorities such as roads and school funding.

The voting set the stage for further discussions as GOP leaders and the Democratic governor work to enact a budget for the fiscal year that starts in October. Lawmakers and the administration will get updated revenue estimates Friday, and the Republican-controlled House could pass its own plan in coming weeks.

As expected, the Senate plan does not include Whitmer's proposed $917 million initial boost in road and bridge spending as part of a 45 cents-a-gallon fuel tax increase to raise $2.5 billion — 30 cents of which would be phased in during the 2019-20 budget year. GOP senators instead voted 22-16, along party lines, to speed up the transfer of $132 million in general funds to the $5 billion transportation budget under 2015 road-funding laws.

Senate Appropriations Committee Chairman Jim Stamas, a Midland Republican, said he supports "getting us closer to the $2.5 billion, but until we actually have those revenues, I think we have to move forward with a real budget with real revenue. And that is exactly what the Senate has proposed."

With the 45-cent gasoline and diesel tax increases being rejected by lawmakers, Whitmer has said she will not sign a spending plan unless the road-funding issue is resolved. GOP legislators say they want to take time this summer to more closely study issues such as how much additional money is truly needed for the roads, where it should be spent across the state and the system's capacity to handle a major influx of new spending.

Democratic Sen. Curtis Hertel Jr., an East Lansing Democrat, said he could not vote for budget legislation "that does not solve our road problem, does not solve our investment in education and it does little to support our local communities."

The Senate bills — passed over the course of two days — would spend $972 million, or 1.7%, more than in the current year. Nearly two-thirds of the increase is due to increased public assistance caseload estimates and changes in the federal government's Medicaid cost share. Under the Senate plan, about $857 million less is budgeted than what Whitmer proposed.

Among the issues dividing Republicans and Democrats was K-12 funding, and the GOP's bid to trim parts of the budgets of Attorney General Dana Nessel and Secretary of State Jocelyn Benson , both Democrats.

Whitmer wants a $527 million boost in the school budget, a 3.5% increase. But the Senate backed a $396 million, or 2.7%, increase.

The Senate did not support Whitmer's proposal to begin a new "weighted" formula to account for extra costs to educate certain students. It instead favored a larger bump in ongoing base aid but smaller increases for special education, at-risk, and career and technical spending.

How the differences are resolved will affect the finances of every traditional district and charter school in the state.

"We would give the governor's proposal an A. This proposal kind of falls a little bit lower, maybe a D for deficient on structure," said Democratic Sen. Rosemary Bayer of Beverly Hills. "It doesn't address the inequities in our system today."

But Stamas said the priority should be reducing the disparity in base per-pupil funding among lower- and higher-funded districts.

"By putting it into the foundation (grant), it continues to close the gap and at the same time allows each of the school districts to make those decisions vs. the state mandating where it has to go," he said.

The Senate did back $120 million for water infrastructure improvements, including to implement tougher lead rules and to address contamination from perfluoroalkyl and polyfluoroalkyl substances, known collectively as PFAS, and other emerging contaminants.

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