Oct 22, 2009

Less than one month after my Senate colleagues were unable to reach a budget agreement and sent the state into a brief government shutdown, we are again in the midst of a budget stalemate.

Throughout this budget process, my Senate Democratic colleagues and I have been and will continue to advocate for the protection of certain budget priorities that are essential to Michigan’s future: early childhood education, scholarship programs for college attendance and worker retraining, police and fire services to keep our communities safe, and health care for Michigan’s vulnerable citizens.

Our state’s economic difficulties have had a severe impact on our state revenues, and some hard budget cuts need to be made. But we must be cautious not to balance this year’s budget at the expense of programs designed to help our economy rebound in the future. Our budget proposal has always called for a mix of tough cuts, significant reforms and the implementation of enough revenue to avoid drastic and dangerous cuts. But we’re running out of time to strike such a balance.

Michigan’s tax structure definitely needs to be reexamined, as it is primarily based on a manufacturing industry that is shifting. Revising our state’s tax system is an important conversation to have, but it is not one that should be rushed, and I don’t think any agreement on changes can be reached by the end of this month.

That’s why I have a simple yet substantial reform proposal that could provide enough funding to protect early childhood education and the Michigan Promise scholarships and could reduce cuts to per-pupil education funding, local revenue sharing and vital health care programs. By simply implementing a 1% reduction in virtually all of the state’s current tax expenditures (excluding the sales tax exemption on food), across the board, we can raise at least $347 million dollars in a fair and balanced way. These expenditures — in the form of tax exemptions and credits — include money for air pollution devices and water softeners, for example. This change would impact all state programs equally and ensure that everyone shares in the sacrifice without having a devastating impact on any one program.

We are definitely cutting it close to reach a viable budget solution, but this reform could be implemented immediately if we can all reach an agreement. This proposal would allow us to institute a balanced budget reform that would eliminate preferential priorities. It would cut back state spending while protecting the most vital programs that the people of Michigan rely on. And it would give legislators more time to discuss other options for reforming government and revising Michigan’s tax structure to match its revenue sources. I urge my colleagues to consider this reform before it’s too late.