Deal done? Snyder, Republicans plan announcement on budget negotiations
Gov. Rick Snyder's office issued an advisory this afternoon to notify media that the governor and legislative leaders are planning a press conference later today to discuss the state of the 2011-12 budget negotiations — and rumors are circulating that the politicians will say that they have reached a deal.
Gov. Rick Snyder speaks at a town hall event during his gubernatorial campaign.
Ryan J. Stanton | AnnArbor.com
Lansing news outlet Gongwer News Service is reporting that the leaders are expected to announce a deal, but no details were available.
UPDATE: Around 1:30 p.m., Bolger tweeted that the leaders had reached a "state budget agreement."
Snyder had set May 31 as a deadline to complete a budget for the 2011-12 fiscal year, which starts Oct. 1.
The press conference comes after the state Legislature last week voted to eliminate the controversial Michigan Business Tax and replace it with a 6 percent corporate income tax that exempts most small businesses, leading to a $1.7 billion business tax cut.
The legislation also adopts a phased-in pension tax, reduces the Earned Income Tax Credit for low-income workers and eliminates charitable giving credits.
The press conference also comes after Lansing fiscal analysts said Friday and Monday that they expect the state to collect between $400 million and $700 million more in revenue in 2010-11 and 2011-12 than they had previously projected.
That led to behind-the-scenes negotiations, and the Legislature is reportedly set to force public school workers to pay 20 percent of their health care premiums when new contracts are negotiated and restore some K-12 funding with several strings attached.
Contact AnnArbor.com's Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter or subscribe to AnnArbor.com's newsletters.
Comments
Cici
Fri, May 20, 2011 : 12:06 p.m.
This 20% for health care benefits (finally!!)....does it affect current retirees who still get it free? It seems to me that burden should be shared by all that receive that benefit, or else the latter are getting the free ride as health care costs mount and medicare shrinks. And - why NOT a graduated income tax on pensions? If my pension is $20,000 and my neighbor's is $80,000 why should we pay at the same rate?? OUCH for disposible income! Federal income taxes have different rates for different incomes, so why not the state? And I do NOT think there should be differences because of age. Just because I might have been born in 1946 and had to retire, I pay tax on any pension, but my brother born in 1945 does not. This is ridiculous age discrimination.
Brittanicus
Thu, May 19, 2011 : 8:46 p.m.
The SAVE Act is a three-pronged approach to reducing illegal immigration in the United States: 1) Mandates the use of E-Verify for all public and private businesses nationwide 2) increase interior enforcement by increasing grants to Immigration and Customs Enforcement and making improvements to the deportation process 3) Increase border security through increased manpower, technology and funding. Our only salvation left to the American populace, is the sovereignty and constitution of the American people is that we need THE TEA PARTY. On any level they will not ratify any laws that are forwarded to Congress, which promotes illegal immigration. We are just importing, more and more poverty. That lowers wages and a poor standard of living for less privileged amongst us, and is part of the problem of the rising US deficit of 14.4 Trillion dollars.
Brittanicus
Thu, May 19, 2011 : 8:46 p.m.
It's remarkable to note, that while the Mexican authorities are condoning the flow of illegal immigrants into our nation and quietly exact their own harsh laws on anybody who crosses the border illegally. This is truly duplicitous when we are immersed in a countries distressed people, which have been rejected by the wealthy elite. The USA is the Mexican government safety valve; to relieve tremendous pressure of millions of poverty driven people, hoping to slide past our less than secure border. Has there been for decades a secret agenda of major players as the business world and other entities? To trick the American people into thinking, that their interests come first? Perhaps they think the American people remain ignorant that the border fence is intentionally left porous in places? Is a secret inducement, for illegal aliens to reach our soil? Otherwise, why is no rational explanation for not making it a felony in breaking our immigration laws, as it is in Mexico? There is an attraction--intentional or not--to import cheap labor for the Republicans and for those who are claiming their right to stay here are attracted to the fold of Democrats, who use their agenda to gain more future votes. Both parties need to be humiliated for what they have done to American culture. For the notice of the Leftist wing of the Democratic Party, no matter how you try to saturate the media, the TV, Radio and Internet with your interpretation for people who come here, without permission. They are not immigrants or undocumented; they are and ever will be--ILLEGAL IMMIGRANTS. Period! A number of States have taken the law into their own hands, because our central government won't? Now enforced to some extent is E-verify, Secure Communities and the 287 G, policing laws, to root-out illegal aliens. This is a section of the SAVE ACT that was introduced by Rep. Heath Shuler (D-N.C.) in the House and Sen. Mark Pryor (D-Ark.) in the Senate.
Brittanicus
Thu, May 19, 2011 : 8:45 p.m.
WHY NOT COPY MEXICO'S IMMIGRATION LAWS? Somebody should ask Michigan Governor Rick Snyder why he thinks his State is any different from Arizona. Is he telling his residents that illegal aliens have not settled there? That they are not accessing free health care or other public services and not draining Michigan of billions of dollars a year in deficits? All States are under this undermining financial strain, so why does Michigan politicians think anything is different? A patriot American sent me an E-Mail which is in printed form of Mexico's annotated immigration laws for immigrants and foreigners. To save space this is the rudimentary portion of the list of offenses, punishable by imprisonment. Locate the eye opener laws at <a href="http://tpo.net/mexico/" rel='nofollow'>http://tpo.net/mexico/</a> that describes in detail, the punishments for entering Mexico illegally. One very important statute to note is every foreigner gets a tracking number when entering this country. There are fines and up to two years imprisonment for entering the Mexico illegally, with retrying that carries a prison sentence up to 10 years. Foreigners who fail to obey the rules will be fined, deported, and/or imprisoned as felons: And you had better not enter Mexico without a way to support yourself economically?
Mr. Ed
Thu, May 19, 2011 : 8:20 p.m.
It's not over just yet. I see pending court action for many different reasons. The recall will move forward as well.
Will
Thu, May 19, 2011 : 7:32 p.m.
The 'deal' better include slashing the free lifetime health care benefits for legislators and judges! If Snyder ignores the outcry from citizens regarding this issue, he is foolish and down right arrogant!
grye
Thu, May 19, 2011 : 7:12 p.m.
Paying an equal percentage of your earnings in taxes is not good enough? You must pay more if you earn more? Then why not require the grocery store to charge for items based upon your earnings? Earn less, pay less. Earn more, pay more. That is essentially what you are saying. I can see the lefties drawing up new legislation. You get to pay less for everything if you make less. You get to pay more if you make more. Government intervention. It's just what we need to make everything equal. What a crock. I pity those that are so jealous of successful people that all they want to do it take.
David Briegel
Fri, May 20, 2011 : 2:35 a.m.
Go to your room. You need a time out. You and Newt Gingrich will be happy there. You can both listen to Sarah and Michelle. I am not jealous of anyone who just shifted the burden of taxation to the poor, retirees and the disabled. You noble souls.
macjont
Thu, May 19, 2011 : 7:39 p.m.
Delusional!
mojo
Thu, May 19, 2011 : 6:32 p.m.
@grye One great idea is to drop all state taxes, like Texas Florida and many others. Texas has far more people then MI and continues to grow at a rapid pace -
DonBee
Fri, May 20, 2011 : 12:03 a.m.
Dave - Because the Loonie is trading for more than $1 and the Federal and Provincial Sales taxes in Ontario are about 13% - the Michigan Retailers are getting great weekend business from Canada. That is a windfall in sales tax revenue for Michigan as well as retail jobs. Drive up to Birch Run on the Weekend and count the number of Canadian license plates.
y2jb10mi
Thu, May 19, 2011 : 8:46 p.m.
I'm tired of the Texas garbage! Texas has over a $13 BILLION BUDGET DEFICIT this year!! While Florida has a $2.5 BILLION BUDGET DEFICIT this year! The "GROWTH" you refer to is clearly their DEFICIT! Texas - "The spending plan calls for a 13% hit to public education and a 7.6% drop in higher education support. Among the cuts, funding for pre-K Early Start programs would be slashed, and four community colleges would be closed." <a href="http://money.cnn.com/2011/01/19/news/economy/texas_budget_deficit/index.htm" rel='nofollow'>http://money.cnn.com/2011/01/19/news/economy/texas_budget_deficit/index.htm</a> Texas and Florida are in much worse shape than Michigan!
1bit
Thu, May 19, 2011 : 8:19 p.m.
Nice post, Dave. Actually, it's probably worse - the Michigander would buy the TV over the internet, have it delivered for free and then "forget" to pay use taxes.
Dave
Thu, May 19, 2011 : 7:37 p.m.
grye/mojo: I think most people like the sales tax/no income tax model, myself included. However, the model is ultimately flawed: It's attractive at the state level because you're simply shifting revenue streams from income to sales tax. However, when you shift it to national or even global scale, suddenly you find Michigan having to be competitive with other states' sales taxes. Ultimately it fails because unless we get all our competition to agree to the same rules, they end up stealing all our sales tax revenue. To illustrate with examples: 1. I'm a Michigander and I want to buy a TV that is priced at $1000. 2. Michigan has a 30% sales tax on TVs (luxury item), and Ohio has a 6% sales tax. 3. Total cost for the TV in Michigan is ~$1300. Total cost for the TV in Ohio is ~$1060. 4. I drive over the state boundary, buy my TV, and pay no revenue to the state of Michigan (whilst I utilize its public roads). [Feel free to throw your criticism at this point.]
grye
Thu, May 19, 2011 : 7:13 p.m.
I like the idea of no income tax. Just raise the sales tax to cover the loss of revenue. Buy something, fund the state. But someone will complain that the poor won't be able to afford what they want.
Forever27
Thu, May 19, 2011 : 6:53 p.m.
more people =/= more prosperous
havefun
Thu, May 19, 2011 : 6:24 p.m.
@grye - In case you missed it, here is my previously posted alternative: "Most states have a graduated income tax, I think Michigan should have one as well. If the state believes the business tax breaks are so important it should be paid for through a graduated income tax, not on the backs of the poor, seniors and public education. "Shared sacrifice" is a nice concept, but it isn't what is happening in Michigan."
DonBee
Fri, May 20, 2011 : midnight
havefun - Sounds great, needs a constitutional change. Are you going to start the petition drive to get it on the ballot? If so post here and I will meet you to sign it. Remember the Jeff Irwin Graduated Income Tax proposal says that if your household has a gross income of $80,000 that you are RICH. If your household makes more than $50,000 you will be in the next bracket down. And how about the $7,500,000,000 in pensions paid to people between age 55 and 65, should we tax that. If 1/2 of it is taxable it would mean that the state at 4.35% (current rate) would make another $163 million in taxes.
Dave
Thu, May 19, 2011 : 7:23 p.m.
First I'll say I agree with a graduated income tax, and that most understand the poor do not have as much expendable income to spare as the rich do. But I might I also remind you that business tax breaks do not equal giving money to the rich... company/business coffers are not personal spending accounts for rich business owners; they're for investment in the business itself, not any one person. Keep in mind though, even if you took every penny from the rich you probably couldn't cover the costs incurred by state services. The rich, old, and poor all share responsibility alike for the state's economy and everyone needs to take what load of the burden they can bear... it's not fair to scapegoat -any- particular class.
grye
Thu, May 19, 2011 : 6:01 p.m.
So all three of you believe this is completely wrong. So let's hear your plans to help businesses grow to create more jobs in Michigan. All I hear is whining and complaining but no alternatives. Please tell us.
Dave
Thu, May 19, 2011 : 7:08 p.m.
Forever27: Still doesn't change basic economics. If I'm an entrepreneur (say for example... IT/Software) and I was looking to open a new office in the Midwest region. Am I going to open an office in a state whose operational costs due to business taxes are higher (in this example, Michigan) or lower (a competing nearby state like OH, IL)? If paying less on my taxes means I have more to spend on product development or staffing, the choice is pretty clear. Yes, it's the old mantra you've heard for 30 years; the principles of economics haven't changed much since then.
grye
Thu, May 19, 2011 : 7:05 p.m.
You want a graduated income tax but still tax businesses at a high rate. When a company wants to expand but doesn't have the capital, what to do? With the extra funds through the reduction of double taxation, businesses can grow. There may be some who will just pocket the money. Can't rule it out, however, the opportunity to grow will not exist without the available funds. However Forever27 would rather tax tax tax until the cows come home. Tax the rich, tax the business, but don't tax Forever27. Not sure how this will help businesses grow.
Forever27
Thu, May 19, 2011 : 6:52 p.m.
@Dave, I've heard that philosophy preached for over 30 years and have yet to see it spawn anything but record corporate profits and a widening of the income disparity in the country. This economic plan would work if we lived in an isolated economy and not a global market that can just undercut any labor deal put in place here (and that's not because our labor is overpaid, it's because labor in developing countries is vastly underpaid).
Dave
Thu, May 19, 2011 : 6:48 p.m.
Forever27: Have you no foresight? We're cutting said business tax revenue stream in the short term so that in the long term we make *more* from business taxes. You can't make revenue on businesses that aren't here... encouraging new ones to come, and local ones to grow [with cheap costs of operation] ultimately makes more money than taxing just a few smaller business to death now.
tommy_t
Thu, May 19, 2011 : 6:19 p.m.
Yes indeed, business and making money our most important priority! People to make it off of can always be legislated.
Forever27
Thu, May 19, 2011 : 6:11 p.m.
It appears that Semper Fi and havefun have given a few examples of how not to screw things up. Republicans preach about fiscal conservativism and balanceing our budgets, yet constantly try to take away revenue streams. Then they point to a lack of revenue as a reason to cut more!
havefun
Thu, May 19, 2011 : 5:51 p.m.
It seems odd that the Republican controlled government would give businesses $1.8 billion in tax breaks when we have a $1.4 billion deficit. It's no wonder that there isn't money for schools when you do something foolish like that. I can understand some sort of sensible tax restructuring, but keep it revenue neutral. Most states have a graduated income tax, I think Michigan should have one as well. If the state believes the business tax breaks are so important it should be paid for through a graduated income tax, not on the backs of the poor, seniors and public education. "Shared sacrifice" is a nice concept, but it isn't what is happening in Michigan. It seems that schools have endured several years of cuts and flat revenue. Now that the school aid fund is beginning to stabilize the Republican controlled government wants to steal money from the schools and use it for purposes that it wasn't intended. That just isn't right and seems like it should be illegal. I believe public education is vital to a successful democracy. Quality teachers are vital to the success of public education. The only way to attract and retain competent teachers is to have competitive wages and benefits. I would think that the typically business savvy Republicans would understand the concept of "you get what you pay for". A few years ago I knew several competent professionals that were considering a career in education. That talk has completely dried up. As the economy continues to improve, I fear that a career in education will be an after thought for college students and other professionals. Where is the recall Snyder petition? I'm ready to sign.
SemperFi
Thu, May 19, 2011 : 5:21 p.m.
Ya gotta love this nerd governor. He reinvents the state by espousing the the idea of promoting high-tech businessses, but cuts funding to all levels of public education. He gushes about Pure Michigan and promotes tourism in the state, but cuts funding to the very agencies that protect our pure water(DEQ) and manage it's parklands and outdoor recreation facilities(DNR). He says he wants to encourage new businesses in the state, but throws out the tax breaks that were the incubator for a fledgling film industry in the state. The nerd can't see the forest for the trees.
Forever27
Thu, May 19, 2011 : 5:18 p.m.
I finally understand the imagery of Snyder's campaign poster with the outline of the state and the arrow above it: It's him giving the bird to the people of Michigan.