Policy changes clinch Michigan budget deal

Lansing — A budget deal approved overwhelmingly by the Michigan Legislature Tuesday includes policy changes related to Gov. Gretchen Whitmer's executive powers, changes that go hand-in-hand with a deal to restore supplemental money for vetoed funding priorities.

The Senate voted unanimously Tuesday to pass supplemental spending bills with added boilerplate language that would allow the Legislature to reverse any budget transfers made by the State Administrative Board this budget cycle. The House concurred on the legislation 105-2.

The language, which would have the enforceability of law for this budget cycle, was a sticking point between GOP legislative leaders, who wanted to tame the executive branch's little-used budget transfer authority, and Whitmer, who did not want to surrender an executive power once used by Republican former Gov. John Engler.  

Senate Minority Leader Jim Ananich, D-Flint, said the package of bills "was a good compromise"  but denied the bills restricted Whitmer's executive powers.

House Speaker Lee Chatfield, R-Levering, described the legislation as an "act of good faith," and the legislation concerning Whitmer's transfer authority as an "impediment" to the executive power of transferring funds within departments. 

"That impediment has restored a balance of power that the governor, Senate Majority Leader and I have all agreed on," Chatfield said. 

The budget process this year exposed "some serious vulnerabilities in statute that allowed what happened to happen," Senate Majority Leader Mike Shirkey said Tuesday of contentious budget negotiations that culminated Oct. 1 in Whitmer's $947 million in vetoes and $625 million in budget transfers.

Tuesday's action leaves more than $400 million worth of vetoes from Whitmer intact. But lawmakers could address restoring more funding at a later date.  

"Specifically, I think it created a serious problem of being out of balance between the executive office and the Legislature," Shirkey said. "These changes reinstate that balance."

Whitmer called the negotiated legislation "an important step forward" that will restore funding to many budget priorities. 

"I support this bipartisan bill and will sign it, honor the terms, and not challenge any of its provisions," Whitmer said in a statement Tuesday. "Let’s get it done, and let’s stay focused on building a stronger Michigan for everyone.”

According to the proposed boilerplate language included in the supplemental spending bills, if the state administrative board transfers appropriated funding, "the Legislature may, by a concurrent resolution adopted by a majority of the members elected to and serving in each house, inter-transfer funds within this act for the particular department, board, commission, officer, or institution."

By signing the supplemental bills, Whitmer likely would set a precedent as to the constitutionality and enforceability of the boilerplate language, making it difficult to rule the line item as unconstitutional if it was included in future budgets. Instead, she would be forced to veto the entire budget to get rid of the boilerplate provision. 

"Though it's a short-term statute, it sets a long-term precedent that I think will be invaluable in future budget conversations," Chatfield said. 

The policy changes bring both sides to a "middle ground" in the budget process, said David Dulio, professor of political science and director of Oakland University's Center for Civic Engagement.

The threat of a veto of a budget including the transfer language could push the Legislature to the table in future negotiations, while the promise of a transfer reversal could keep the governor in budget discussions, Dulio said. 

"Not everybody gets everything they want, but everybody gets something that they want," Dulio said. "I think this is a great example of compromise.”

The Senate's Appropriations Committee on Wednesday plans to reverse some of the $625 million in transfers made by Whitmer Oct. 1 to provide for the supplemental spending the chambers approved last week. 

Last week, the two chambers moved legislation that would restore $573.5 million of the $947 million in vetoed items and several other items that were priorities of the governor, but that restored funding is contingent in part on the transfers being reversed Wednesday, said Amber McCann, a spokeswoman for the Senate Republicans.

Any reversed transfers would be sent to the state budget office, which is expected to accept those reversals, McCann said.

The $114.5 million supplemental spending bill for education and the $459 million general government supplemental would restore several items considered "immediate needs" that had been vetoed by the governor. In total, the bills would restore funding to 27 of the 147 items vetoed by Whitmer and reverse funding transfers in six departments. 

Among the items restored in the supplemental spending bills are funding for the Michigan Tuition Grant, an aid increase for charter schools, summer school literacy interventions, early literacy coaches, isolated school districts, county jail reimbursements, rural hospitals, an autism support program, opioid response programs, secondary road patrols, and payments made in lieu of taxes to communities contained state-owned land.

The supplementals contain funding requested by Whitmer, including funding for new prison officers, tether replacements for parolees, the implementation of the Medicaid expansion work requirement, the implementation of no-fault auto insurance reform, 2020 Census activities and the independent citizens redistricting commission.

Along with the supplemental spending bills, the Senate and House unanimously supported four bills connected to the budget deal.  

The legislation would require the governor to provide the Legislature with 30 days' notice of planned budget transfers via the State Administrative Board and require the Legislature to provide the governor with a budget proposal by July 1.

Two other bills would allow the Office of Auditor General access to certain executive records during audits, legislation that arose from delays by state departments concerned about handing over documents they consider confidential.

In 2018, the auditor general went so far as to sue the Michigan Department of Health and Human Services for access to adoption records needed for a performance audit. 

Similar legislation empowering the Office of Auditor General was vetoed last year by Republican former Gov. Rick Snyder, who called the legislation “an unconstitutional overreach that would blur the separation between the legislative and other branches."

The Legislature could restore next year other budget items that were vetoed, such as $37.2 million for the workforce training program Going Pro or $37.5 million for the Pure Michigan tourism campaign. 

It's not likely there will be additional restorations — other than what's outlined in the supplemental bills — before 2020. And Shirkey said he believes the funding shouldn't be restored for Pure Michigan. 

Taxpayers funded the tourism and marketing program for several years, proving it could work and taking the risk out of such an investment for the business owners who profited from the increased tourism, Shirkey said. 

"I believe that those who benefit the most from Pure Michigan should be the ones that primarily fund it," said Shirkey, noting his view was "one man's position."

eleblanc@detroitnews.com