Michigan auditor general asks Legislature to rethink 28% cut to office's budget

Lansing — A state office tasked with auditing Michigan agencies and programs is urging legislative leaders not to adopt Gov. Gretchen Whitmer’s proposed spending plan for the office, arguing it would reduce its funding by roughly 28%.

Auditor General Doug Ringler sent a letter to the Republican and Democratic leaders of the House and Senate Wednesday, noting the governor’s executive recommendation would cut a net of $8.3 million from his office — a loss that “would significantly impair the oversight we provide to you and the public.”

The governor’s proposed budget cuts to the Office of Auditor General come after nearly three years of blistering audits of Michigan’s unemployment insurance agency, the state civil rights agency and some Michigan child services programs.

“We received no advance notice of the executive budget reductions and no direct feedback regarding the reason behind them,” Ringler wrote.

The office, which is constitutionally authorized to audit state agency finances and performance, does a vast array of work that is required under state law, including a $3.2 million annual statewide single audit required for Michigan to continue receiving federal aid.

The potential cut was promptly criticized by Republican leadership, which argued the budget reductions were largely meant to benefit the governor's administration.

“Her administration has received failing grades from this investigative office throughout her tenure, and to keep her future aspirations intact, she wants to make sure no one is checking her homework,” said House Republican Leader Matt Hall of Richland Township.

House Speaker Joe Tate, D-Detroit, will review the concerns raised by the auditor general, said Amber McCann, a spokeswoman for Tate.

“As you know, assembling the budget in the Legislature is a process,” she said.

The State Budget Office on Thursday said the $100 placeholders replacing roughly $9.3 million in the budget indicate that funding will "be determined based on need."

"We will continue to work with the legislature to pass a balanced budget that puts Michiganders first," Leeds said.

The governor presented her $80.7 billion executive budget recommendation to the Democratic-led Legislature in February, kicking off a budgeting process that will likely run through June and include separate proposals from the House and Senate.

Unlike recent year budgets bloated by higher than expected tax revenue and federal COVID relief, the governor's recommendation came in lower than the last budget and left very little — about $19 million —on the state balance sheet. A large chunk of the funding filling the budget is contingent on the Legislature signing off on a controversial redirection of $670 million that would usually go to the state teachers' retirement fund.

For the Office of Auditor General, instead of continuing to fund 23 interdepartmental grants and 13 special revenue allocations worth about $9.3 million, the governor’s budget set a $100 placeholder that is sometimes used to flag programs whose funding is removed but could be replaced in the future.

Whitmer's proposal increased general fund allocations for the office by $1 million, creating a net loss of $8.3 million or a 28% cut for an overall budget of $21.4 million.

“The reductions occurred after it was our understanding the legislative leadership supported a 5% increase in our overall budget,” Ringler said.

eleblanc@detroitnews.com