Lansing – The biggest news to hit Lansing in recent years is Governor Snyder’s much-anticipated tax reform and budget proposal presented on February 17. The highlights having been leaked the day before, demonstrators were already outside protesting. Basically Lansing has been a mini-version of Madison, Wisconsin the last several weeks.
The Governor had two problems to solve for his FY2012 budget. First, he needed to close the $1.4 billion structural deficit (expenditures exceeding revenues) that has been solved with one-time fixes or federal stimulus funds the last several years. Second, and in keeping with his campaign promise, he proposed abolishing the Michigan Business Tax which brings in $2.2 billion a year. Thus the Governor had to find $3.6 billion in revenue through tax policy changes and spending cuts to balance the budget.
Where did he find the money? Why, by eliminating the tax exemptions and credits for pensions and seniors (worth over $1 billion), nixing the Earned Income Tax Credit for the working poor (worth $374 million), abolishing the $600 child deduction, phasing out the $3,600 personal exemption for higher wage earners, and getting rid of dozens of other tax credits like the city income tax credit, public contributions credit, college tuition credit, adoption credit and many others. Spending cuts for K-12 schools, higher education, and local government also helped to close the budget gap.
The replacement tax for the MBT is a proposed tax on large corporations only. It would bring in only $460 million, therefore reducing business tax revenues to the state by 86 percent. 95,000 businesses would no longer have to file any business income tax return under the Snyder plan. Business interests practically quivered with excitement about this sudden windfall to their bottom lines during subsequent House Tax Policy Committee hearings. Their man Rick had delivered for them big time.
However, Legislative office phones and e-mail accounts began filling up pretty fast with objections to the new taxes on the elderly and the working poor while giving a no-strings-attached big bonus to all businesses in Michigan. About a third of the Senate Republicans announced opposition, one saying you can’t put granny out to pasture and then take away the grass!
If this weren’t distracting enough, the Republicans in the Legislature have been running every anti-labor union idea they could find from Wisconsin and other new Republican Governors. Among the most controversial bills are the ones which would permit the Governor to appoint an emergency financial manager for a local school district or local government experiencing a financial crisis. The appointed manager could void all contracts, including collective bargaining agreements, as well as dismiss the school board and its personnel or local government council and staff. With the Governor proposing to reduce aid to these very entities, quite a few of them are likely to go into receivership and be subjected to the EFM laws. Think back to our colonial era when King George III selected the leaders of each community. Are we destined to repeat history?
On the women’s news front, Republicans have introduced bills putting a strict 48-month limit on financial assistance to poor people (mostly poor moms), stricter drug testing of them, etc. The Governor appointed Susy Heinz Avery to succeed Judy Karandjeff as Executive Director of the Michigan Women’s Commission and Barbara B. Gattorn as chair of the Michigan Women’s Commission. Avery, of Bloomfield Hills, most recently worked as director of State Government Relations for Wayne County Airport Authority. Gattorn, of South Lyon, was formerly senior advisor to the president of the Detroit Regional Chamber of Commerce.
Meanwhile, the Senate Judiciary Committee has passed bills criminalizing improper disposal of fetal remains and banning a late-term abortion procedure opponents call partial-birth abortion. There is already a federal statute barring the procedure, but Right To Life of Michigan wants to enable the Michigan Attorney General, local county prosecutors, and third parties to go after abortion providers they suspect of using the procedure. No intact dilation and extraction abortions have been reported in Michigan in recent years, according to the Department of Community Health. Governor Granholm vetoed this same bill in 2008, because it contained no health exception.
Mary Pollock is a long-time women’s rights advocate and experienced observer of the Michigan capitol scene. A former local elected official herself, she has held key posts in the legislative and executive branches of Michigan government.
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