June 18, 2026 | This Week in Government: Legislative Democrats Split on Whitmer’s International Mission Ahead of Budget Deadline, Lay Blame on Hall

As the Legislature’s budget deadline of July 1 approaches, one key player in negotiations is missing from the state, but most House and Senate Democrats remain steadfast on placing the blame on House Republicans.

Gov. Gretchen Whitmer is currently on her second trade mission of the year, a European tour of France, Belgium and Luxembourg to meet with defense and aerospace leaders, as well as attending a global conference on the security industry. She is traveling with a delegation from the Michigan Economic Development Corporation, and will be in Europe for a week.

The trade mission has garnered criticism from Republicans from both chambers, but legislative Democrats are split: some say it’s a beneficial trip, some say she should stay in the state so close to the July 1 deadline to pass a budget in time for the start of school district and local government fiscal years.

However, most are pessimistic about the chances of getting a budget done on time and seemed to place most of the blame at House Speaker Matt Hall’s feet rather than pointing fingers at Whitmer.

Rep. Dylan Wegela, D-Garden City, said he thinks the governor should be in the state worried about the issues of working-class people. Many of the trade missions, he said, are meant to just find more ways to give corporate subsidies to other countries, like the Rheinmetall deal with a German defense manufacturer that came out of a trip last year. He said he didn’t think that was something Michiganders supported.

If there’s any good that comes out of the trade missions, Wegela said, he hasn’t seen it.

He said instead, Michiganders would rather have Whitmer here figuring out how to get a budget passed on time.

However, he said doesn’t feel it’s a real hindrance to getting a deal done because Hall is signaling heavily “he’s going to drag this out as long as he feels like.”

Rep. Laurie Pohutsky, D-Livonia, said she doesn’t think it’s necessarily pushing back the budget timeline, but the timing of the trip is less than ideal when they should “all just be here buckling down and working on getting a budget done.”

The House Oversight Corporate Subsidies and State Investments Subcommittee, which both representatives sit on, held a committee meeting last year following complaints on how much was being spent on trade missions. Wegela said since the hearing, he does not feel he has any more insight on the trade missions other than just how frequently the governor is out of the state.

Rep. Morgan Foreman, D-Ann Arbor, said she appreciates Whitmer’s efforts on international relations, especially on trying to bring industry to Michigan. Securing investment in Michigan is important, she said.

But Foreman also noted Whitmer’s lack of in-person presence at the Capitol in the final weeks to resolve the budget.

“I think that it’s difficult to mandate that a body of people do something, and technically you’re the leader, but you’re not there to help lead and guide,” she said. “I appreciate this final goodbye tour she’s doing, but I think that she’s relevant enough and strong enough that there’s some things that could wait, and things that can be done even after she’s out of office as the advocate she’s been for Michigan since her legislative career.”

Rep. Erin Byrnes, D-Dearborn, said she was in Lansing and ready to work on the budget, and “would love to see the governor here in Lansing, working alongside (them), because (they’re) going to need all hands on deck.”

But Rep. Jason Morgan, D-Ann Arbor, said anyone who believes the governor personally negotiates the entire budget “would be silly to think that’s how the process works.”

“There are a whole number of conversations ongoing around the budget still, and as far as I know, everyone is extremely engaged,” Morgan said. “Also, we have this thing called technology today, where you can email or Zoom or have phone calls to continue the process moving forward, so that doesn’t concern me at all, because I know that the ongoing conversations are happening.”

Rep. Carol Glanville, D-Walker, said her frustration is that this unrealistic standard could be used as a talking point and will be used as a distraction to being 10 days away from the deadline without “any serious steps in the right direction.”

She said it’s an excuse House Republicans can use to evade work.

Senate Majority Floor Leader Sam Singh, D-East Lansing, said his understanding is that negotiations have been ongoing with the appropriate House, Senate and State Budget Office staff to get to the point to where they now are.

“I am still confident that we’ll get something done … that week of June 30, July 1, July 2, somewhere in that space,” Singh said. “I’ve got faith that if everybody comes to the table to truly negotiate, then we can actually get it done.”

Singh said if budget targets can be agreed upon later this week, the July 1 deadline can still be met. He added he was not concerned about the governor not being in the room during this stage given the trade mission.

“It’s usually at the end that you pull in the top principals, and so you don’t need the governor to be figuring out what the targets are for a department, right?” Singh said.

Sen. Jeff Irwin, D-Ann Arbor, dismissed Whitmer not being in the state this week as an obstacle to completing the budget. He said that she can coordinate with her staff and budget officials remotely. He took aim at the House speaker as being more of an obstacle.

“I think that the obstacle that we continue to face is half-baked ideas being put halfway on the table and being a barrier to moving forward,” Irwin said.

He said his expectation is that members should be able to vote in two weeks on a budget, adding that between what both chambers passed there is no reason to not be able to come to a reasonable agreement.

“There’s no reason we shouldn’t be able to get it done,” Irwin said. “Our schools need it. Our local governments need it. I think everybody recognizes after what happened last year that the chaos and uncertainty of last year’s process is unwelcome and damaging to our state, and so hopefully that carries the day.”

If House Speaker Matt Hall relents on his unfunded $5 billion property tax proposal, budget negotiations will move much more quickly, Budget Director Jen Flood said in a statement on Wednesday.

“Negotiations are ongoing, and we have been meeting regularly with the Legislature. As soon as Speaker Hall moves away from his proposal to either blow a $5 billion hold in the School Aid Fund or raise $5 billion in taxes on working families, we will get a budget done quickly,” Flood said. “Our focus remains passing a fiscal year 2027 budget ahead of the July 1 deadline that prioritizes investing in kids and protecting access the healthcare.”

It was, by far, the sharpest criticism leveled against Hall’s property tax proposals by the administration of Gov. Gretchen Whitmer. To this point, the governor had not openly criticized his plan but had somewhat scoffed at it as a concept more than a plan.

The House has passed several pieces of its property tax plan that would cut more than $5 billion in tax revenue, but notably, it has not passed HB 5880, the bill the rest of the plan is tie barred to, which would backfill the cuts in revenue for schools and local governments by expanding the 6% sales tax to unspecified services. Hall has repeatedly said that tax would be applied only to “luxury” services.

Documents provided to Gongwer News Service prepared by the Department of Treasury show that there is nowhere near $5 billion in revenue to be gleaned from taxing “luxury services.”

To generate that amount of revenue, the state would need to tax services like food, medical services, construction, transportation and professional, scientific and technical services, like consulting or architectural services.

Treasury compared Ohio’s service taxes and scaled them to Michigan. Ohio’s service taxes include business data processing and electronic information service, repair services, personal care services, gym and fitness memberships, streaming services, installation services, among others. The department estimated that if Michigan were to tax the same services as Ohio, the expected revenue would only generate about $1.76 billion.

Hall, R-Richland Township, however, insisted on Wednesday the hold-up on negotiations was not his property tax plan, but rather, that the governor was not in the country.

“Without the governor, we can’t negotiate any further,” he told reporters. “We’re at a very preliminary stage of the negotiations where we need the top principles to determine things like how much money is going to be in the school aid budget.”

Hall said that last year when Whitmer was traveling before the budget was passed, those decisions had already been made.

“I was not critical of her last year, because last year, we’d made our decisions,” Hall said. “What we’ve seen is that with the communication from her limited, the administration is, I would describe it, more in a holding pattern on the budget.”

Hall said Whitmer’s absence made making the July 1 budget deadline very unlikely.

“That’s why I put other ideas out on the table last week,” he said, referring to his statements during a press conference last week that he was willing to pass a four-month continuation budget after the October 1 deadline. “We’re waiting for the governor to reengage to see if we can hammer out those big things. … The point is, if we want to solve this problem, you may have to just do it the way we did last year.”

Hall went on to say that budget negotiations had been at a standstill since last week.

A source speaking to Gongwer News Service on background with knowledge of budget negotiations said Hall and Whitmer had discussed the budget as recently as Wednesday, and that the speaker and the governor had discussed the budget multiple times over the weekend.

A spokesperson for Hall, however, said the speaker and governor had not discussed the budget during the weekend.

Multiple sources told Gongwer that there is still no agreement on targets, nor is there a definite agreement on framework for the budget.

The July 1 deadline is 14 days away.

A congressional subcommittee diverted from its usual setting to meet in a hangar full of helicopters northwest of Lansing on Friday, at the invitation of U.S. Rep. Tom Barrett.

The Technology Modernization Subcommittee of the U.S. House Committee on Veterans’ Affairs met for an oversight hearing at the Grand Ledge National Guard Army Aviation Support Facility and Armory. Barrett, R-Charlotte, who chairs the subcommittee, and its ranking member, U.S. Rep. Nikki Budzinski, D-Illinois, heard sworn testimony from U.S. Department of Veterans’ Affairs officials, watchdogs from the U.S. Government Accountability Office and state and local healthcare providers.

The topic at hand: access to community care, the program which allows veterans to utilize health providers in their area when they live too far from a VA facility to regularly make use of its medical services. In most of Michigan, where VA hospitals and clinics are consolidated largely in the southern portion of the state, large populations of veterans rely on community care to receive medical services close to home, Barrett said.

“These are the providers outside of your traditional VA hospitals that provide quality medical care for veterans closer to home, and in some instances faster than they could get those services through the traditional VA hospitals. In this community that I serve, we have no large VA hospitals in this area,” he said. “We have some outpatient clinics, but no large VA hospitals. You would drive generally more than an hour, some instances up to an hour-and-a-half, to get to a VA hospital for care or treatment that you may need for a lot of repeated services.”

Community care acts as a significant stopgap for the areas VA facilities can’t cover, but the program has inefficiencies that can lead to longer wait times for appointments or difficulty connecting veterans with specialty providers when they need them. Barrett and Budzinski introduced legislation to codify a scheduling program the VA has adopted which makes it easier for non-VA providers to share their appointment openings with the agency, which can have staff search for available appointments, drive times and distance when a veteran calls and book directly with the community care provider.

Currently, not all community care providers use the online scheduling system, which the lawmakers said necessitates passing their proposal to make it the standard for the program.

“There continues to be kind of a bureaucratic inefficiency about how we get providers signed up for community care benefits for scheduling,” Barrett said. “One of the hardest things is that scheduling to get a veteran placed for an appointment for community care service into that is getting community care providers into the scheduling process to make that easier. It’s become a challenge that we need to do better at.”

Budzinski said the portion of community care providers actually using the newer scheduling system is far too small given its potential to streamline the process of securing appointments for veterans in a timely manner. She questioned whether the VA did enough to recruit healthcare providers into an optional program before launching it.

“There are well over 1 million community providers, and VA has only signed up about 25,000. That’s barely 2% … we recently learned that of the providers that have signed up, they have a greater than 30% turnover rate, meaning they’re losing providers while almost as fast as they’re signing them up,” she said. “VA prioritized the deployment over recruiting efforts, and now I suspect there are many facilities with a shiny new tool that is effectively useless.”

VA officials speaking before the subcommittee touted the scheduling program’s benefits and spoke about pilots conducted in Georgia and South Carolina to expand it to allow veterans to view available VA and community care options side-by-side and choose which appointment they’d like to book. Government accountability watchdogs, however, said much of the goal to improve inefficiencies and wait times remains unfulfilled.

“VA has yet to provide a comprehensive view of what that final scheduling process should be, and I think it’s like a Lewis Carroll saying, ‘if you don’t know where you’re going, any road will take you there,’” a GAO official who testified said. “VA has not yet defined what that final destination looks like, so you have a lack of a fully defined business process for what that standardized scheduling workflow looks like, and then what are the underpinning IT solutions that that are supposed to support that.”

Officials said in Michigan, the system is underutilized compared to the pilot programs in Georgia and South Carolina where additional outreach and recruitment has been done to enroll community care providers in the scheduling platform. However, VA staff said, engagement with Trinity Health System, University of Michigan Medicine and Henry Ford Health is underway, and the department maintains a “productive relationship” with the Michigan Health and Hospital Association that the VA has used to make inroads with providers.

Ben Frederick of Memorial Healthcare said one area the VA can work with independent hospitals on is easing the burden on veterans to maintain so many aspects of the patient-provider relationship. Many veterans, he said, lose contact with providers or fail to follow up with community care institutions not because their experience was inadequate, but because they weren’t aware it was their responsibility to handle billing or scheduling a next visit.

“We’re able to be more of an advocate alongside the patient just to keep them connected with their care, but so often we see in between visits, they’re charged with that next connection point, and we’re kind of waiting to see what the determination is going to be to your point about the relationship,” Frederick said. “Are they going to be able to maintain that specialist relationship? Oftentimes, we have concurrent decaying clocks on number of visits and duration of authorization, which compounds the issue. That’s actually the chief reason why we slip into denial situations, actually, we miss a deadline like that, but there’s a lot of pressure on that veteran.”

Barrett said he found the discussions productive and came away from the hearing with an understanding of what lawmakers and the department can take as next steps to improve upon the scheduling program and other aspects of the community care process. Barrett and Budzinski’s legislation passed the U.S. House earlier this year but remains stalled before the U.S. Senate.

“We’re going to continue to work on all these things,” Barrett said of the policy areas he’s taken on over his year-and-a-half in office so far. “We got a lot of challenges we’re facing in the country right now, but I try and tackle them as best we can with the time that I have in the term that I’ve been elected to.”

Lawmakers and state employees agreed in Tuesday’s meeting of the House Oversight Committee: it was a bad year for customer service at the Department of Treasury.

The department switched to a new operating system this year, which Tax Administration Services Bureau Director Katina Litterini said was more efficient and aligned with national fraud prevention standards.

Although the new e-service platform offers a variety of services – including free return and form filing, real-time power of attorney, integrated electronic payment options, access to returns and their status, tax record, any documents sent out by the department or sent in by the taxpayer as well as online messaging with Treasury – it was not without issues.

The department issued 27,000 letters with incorrect notice of adjustments, which Litterini said was caused by a calculation field that was misread out of the new system’s platform.

“When we recognized this issue, we immediately reached out to our partners,” she said. “We took their feedback, incorporated the changes, and then we issue out the corrected notice of adjustment letters within less than 30 days.”

In a typical tax season, about 5 million returns are filed, Litterini said. Refunds are typically issued within four to six weeks.

“Customer service has been a challenge this year,” Litterini said. “The high volume does not reflect the entire taxpayer population. A very small, significant group can generate thousands of contacts.”

She said the department’s contact center also has an outdated phone system, which led to delays.

This year, about 1 million phone calls were made to the call center between February and April. The average speed of answer was around 15 minutes, and the average call duration was six minutes, Litterini said. This year, the department processed more than 5 million returns and issued more than $3 billion in refunds. Of those, about 90% were processed automatically.

“The high demands were exceeding the system’s capacity, and we did drop calls,” she said. “The 10% of complex cases generated multiple contacts and escalations. In the month of April alone, you’ll see that staggering statistic there: 65 callers called more than 100 times, that resulted in 11,000 phone calls.”

The issue is not a lack of staffing, Litterini clarified.

“It’s the phone system,” she said. “There are only so many calls that will go in the queue, and then it will disconnect that call.”

Department officials said the phone system would be updated in July, adding it was not done sooner to avoid a change to the phone system and the e-service platform at the same time.

Rep. Matt Bierlein, R-Vassar, noted how difficult it was to receive a response from Treasury. He said last year, his office called the department around 20 times, but this year, that number ballooned to 125, and it was difficult to get a reply.

“It’s a significant uptick,” he said.

Peter Mormon, who testified on behalf of Treasury, acknowledged that the department’s responsiveness standards were not being met.

“I will say this is a small, dedicated team that has a long track record of working very well with your offices over many, many years, and they care a lot about responding,” he said. “With the surge and the volume, the small team was not able to meet our typical standards.”

Bierlein also said constituents told him they filed a tax return this year, which was basically the same as the previous year, but it was flagged.

“One in particular that was brought to our attention was a farmland preservation credit,” he said. “They’ve filed this same thing for multiple years. It was flagged. We brought it to your attention, and we were told it was going to take 25 weeks for that to be manually reviewed.”

Litterini said that it was an issue with the new platform.

“This gen tax platform is extremely precise in the data information it’s looking for on the returns, so it has caused some delays,” she said. “I can say that the tax returns are unique, and some will take more time for more complex returns.”

Rep. Jennifer Conlin, D-Ann Arbor, noted that it took months for some of her constituents to receive their returns.

“They were late on rent, late on different payments,” she said.

Litterini said that the department was flagging issues with the new platform this year to fix as they came up, but there were also new offsets this year that delayed refunds.

“One of the biggest impacts we saw with the season was people were filing their tax returns, and we were withholding their refunds,” Litterini said. “One of the main reasons why we were holding their refunds is because the IRS state income tax levy program. … It’s been paused since 2020. It’s pretty significant because it went from zero to $18 billion.”

Rep. Angela Rigas, R-Caledonia, also raised the issue of delayed refunds and difficulty contacting the department.

“Why aren’t the taxpayers receiving their money, their refunds from the state of Michigan, in a timely fashion?” she said. “Why would someone have to call Treasury that time to try to get information or an answer?”

Litterini said the best approach right now is to contact the department through the e-service platform, where there is a feature to request a call back within 72 hours.

Rigas said that was difficult for older taxpayers.

“A phone call should be sufficient,” she said.

Rep. Jay DeBoyer, R-Clay, who chairs the committee, said that the other issue was that when people were able to connect with a person, they still could not escalate their request to get help.

“They had a real person they were talking to, but it doesn’t seem that they can move down the food chain to get it to the person that might be able to actually resolve that return,” he said.

He also noted it was a problem that the 27,000 letters were sent out without questions.

Litterini said that was due to the system change, but the department has since adjusted.

“What we’ve done in Treasury now is (we’ve) put added measures of oversight, so this does not happen again,” she said. “A checklist and approval that goes all the way up to the income tax administrator and up to me as the director before any sign off is given.”

The department worked to address that error quickly, Litterini said.

“We sorted it out within 30 days. We rectified the issues, and then followed up with those communities,” she said.

DeBoyer asked if some of the fees and interest charges for late payments would be waived, and Litterini said that it was something the department was looking at on a case-by-case basis.

Annette Craft, a CPA in Lansing, testified about the issues she has had with the department, including loss of documentation, a disconnect between the department and the collections division and the length of time it takes to resolve more complicated issues.

“It is self-evident that this new system was not adequately tested, which raises concerns about the competency of the system being resolved and the issues, and you have the panel here has already addressed the fact that they’re reaching out to accountants, and so that is hopeful, because their involvement in feedback on the systems prior to the launch would have been extremely helpful and possibly have avoided a lot of these errors,” she said. “One of the primary goals of the Treasury Department should be to facilitate and expedite compliance. Instead, those who generally attempt to comply are met with impediments derived from hubris of bureaucracy.”

Lawmakers also questioned the number of audits done on small businesses by in-state specialists versus larger, out-of-state companies.

Theresa Newton, director of revenue compliance, said that had more to do with the way new auditors are trained and the fact that the department had to hire new auditors.

“We don’t necessarily recognize this in-state out-of-state,” she said. “Just because the number of out-of-state auditors is reducing, doesn’t mean we are reducing our number of out of state audits.”

DeBoyer said that he hoped the committee would provide Treasury with insight into some of the issues people were facing outside of Lansing.

“With regard to taxpayers and people who view you as a service, even though they may not like you,” he said. “It’s still a service, and I hope that you understand how big of an issue it is that we’re dealing with literally thousands and thousands of phone calls on this issue. So, please take that back to your office and do what you can to fix this problem.”