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Sept. 24 | This Week in Government: Budget Increases in Many Areas; Chamber Poll Shows Updated Whitmer, Biden Approval Ratings

Each week, the Detroit Regional Chamber’s Government Relations team, in partnership with Gongwer, will provide members with a collection of timely updates from both local and state governments. Stay in the know on the latest legislation, policy priorities, and more.

  1. Budget: Increases in Many Areas, But Billions Remain Available
  2. Voters Now Split on Whitmer, Biden’s Numbers Falling
  3. LEO 2021-22 Fiscal Year Budget to Sharply Decrease
  4. Talks on Billions Still Available to Continue, Officials Say
  5. Schneider: Incumbents Tough to Beat in Michigan

Budget: Increases in Many Areas, But Billions Remain Available

All sides praised the $52.95 billion budget agreement Tuesday that provided increases nearly across the board, but also left substantial funds on the table to spend later.

The final pieces of the budget, which provided funds for all of the executive departments, higher education, and community colleges, moved through conference committees Tuesday and the departmental budget saw final Senate action. Final votes, in the House on both SB 82 and HB 4400, and in the Senate on the House bill, are expected Wednesday.

With the expected final action, the Legislature will complete work on the 2021-22 fiscal year budget with more than a week to spare prior to the Oct. 1 start of the fiscal year.

The budget agreements provide $50.71 billion for the various departments, including $10.38 billion General Fund. Community colleges and universities would see $2.24 billion, with $793 million from the School Aid Fund and $1.32 billion in General Fund.

The agreement also left nearly $5 billion in the General and School Aid funds to be appropriated either later in the year or in some future budget. Of the $3.5 billion in unanticipated revenues that was recognized at the May Revenue Estimating Conference, $2.86 billion would be unspent in the 2021-22 fiscal year budget. Another $2 billion in revenues that have come into the state since the May conference were also left out of the agreement.

That would appear to set the table for a series of potentially massive supplemental bills in the coming months, not to mention the more than $6 billion in American Rescue Plan Act funds the state has received with eligibility to spend now.

Members serving on the two conference committees that moved the multi-billion-dollar omnibus budget bills to the House and Senate floors Tuesday, along with Gov. Gretchen Whitmer, called the contents of the final products a win for the state, thanking each other for their work and being able to come together in a bipartisan manner.

Both omnibus budgets, SB 82 for various state departments and agencies and HB 4400 for higher education and community colleges, were adopted by votes of 6-0 by their respective conference committees.

“This … reflects the reality of the state and helps address many other real-world demands that face families, businesses, and communities,” Sen. Roger Victory (R-Georgetown Township), chair of the Conference Committee on SB 82, said. He went on to thank everyone from lawmakers to staff for their long hours of work on the bill to get to this point.

Sen. Curtis Hertel Jr. (D-East Lansing) agreed.

“This budget is really a great example of the bipartisan work that can be done in this building, and I hope it will be a sign of the future,” Hertel said.

The Conference Committee on HB 4400 quickly adopted its bill minutes after SB 82 was adopted.

“I think this is a solid budget that’s responsible for the people of Michigan,” Rep. Mark Huizenga (R-Walker), chair of the conference committee, said following the vote.

“We negotiated together in good faith and this budget makes bold investments in Michigan’s families, in our communities, and in our small businesses,” Gov. Whitmer said at a media event Tuesday at the Detroit Regional Chamber’s Mackinac Policy Conference. “I’m looking forward to signing this budget.”

Asked about the lack of transparency regarding the budget – once again, it will be on its way to the Governor’s desk roughly 24 hours after its details became public – Gov. Whitmer said the times are unusual.

“I think it’s important that people have an opportunity to digest what is in the budget and see what the priorities are,” she said. “We wanted to negotiate. Those negotiations were in good faith. They were bipartisan. They were very productive. They weren’t always easy, but that’s the nature of a negotiation. But I’m really pleased with how this budget ended up. I wanted to give the Legislature the ability to inform their members before sharing too much widely so they could do what they needed to do to get their members up to speed. They’re the ones who are going to be taking votes today and tomorrow and so I wanted to honor the confidentiality that we agreed to.”

Rep. Thomas Albert (R-Lowell), chair of the House Appropriations Committee, said in a statement that the budget contains many of the priorities House Republicans sought.

“Supporting families as they resume daily routines, assisting workers and small businesses, helping local communities rebuild bridges and improve infrastructure – that’s what is needed for our state to fully recover and thrive,” he said.

Sen. Jim Stamas (R-Midland), chair of the Senate Appropriations Committee, said in a statement that the budget focuses on helping families, workers and the economy recover from the pandemic.

“We are lowering childcare rates and increasing capacity, fixing local bridges and dams, permanently increasing wages for our direct care workers, providing training to help people obtain in-demand jobs, protecting our water, and helping our tourism industry get back on its feet.”

Among the major highlights was the $1.4 billion for child care.

Among the pieces Albert highlighted were funding for child care and workforce development. He also noted the $500 million deposit in the state’s rainy-day fund.

Stamas called out the funds for direct care workers and dam repairs.

On the other side of the aisle, Hertel called out funds to replace lead water service lines and repair bridges around the state.

“This budget invests in Michigan’s potential, delivering real change for working families and setting us up for future success,” he said in a statement. “Today we showed what we can accomplish for Michiganders when we come together with a common goal in mind. I’m looking forward to continuing to work with Governor Whitmer and my colleagues in the Legislature to allocate remaining federal funds and build on the investments made today.”

Republicans also praised language in the Department of Health and Human Services budget that would unappropriate essential local public health services funding if a local health officer has an emergency order in effect as of Oct. 1. Other sections of the budget would prohibit some state action on mask or vaccine mandates in response to the COVID-19 pandemic.

Gov. Whitmer was asked about boilerplate language throughout the budget barring any kind of a requirement for persons to be vaccinated against COVID-19 to access services or limiting a government from acting to slow the spread of the virus.

“We had some discussions around various aspects that are in the budget. We did not come to agreement on certain things,” she said. “We did on others. At this point, when the budget is shared more broadly, I’ll be happy to delve in a little deeper with you at that juncture.”

Pressed on whether she would sign a budget that contains language preventing a government from issuing vaccine mandates, Gov. Whitmer said, “You’re doing a great job trying to pin me down, and I applaud that, but I’m going to let the budget become public before I weigh in on precisely our determination on all the different pieces of the budget. We will do our review. It will not be a surprise to the people with whom we’ve negotiated.”

Gov. Whitmer could choose to declare the language unenforceable.

Robert McCann, executive director of the K-12 Alliance of Michigan, urged Gov. Whitmer to take that action. Several counties have issued orders requiring face coverings at K-12 schools.

“Schools have been working very closely with local health departments and would certainly hope the Governor would utilize her authority to allow that partnership to continue on behalf of our students,” he said.

Related: Fix the Road Ahead: Gov. Whitmer on Michigan’s Path Forward


Voters Now Split on Whitmer, Biden’s Numbers Falling

MACKINAC ISLAND – A statistically insignificant difference exists between the percentage of Michigan voters who approve of Gov. Gretchen Whitmer’s job performance and those who disapprove, a new poll says.

The survey was commissioned by the Detroit Regional Chamber and conducted by Glengariff Group of 600 registered voters between Aug. 30 through Sept. 3. It has an error margin of plus or minus four percentage points. Seventy-four percent of respondents were contacted via cell phones.

The 47.9% approve, 46.3% disapprove numbers are the softest Gov. Whitmer had since before the COVID-19 pandemic hit, when she was at 43.3% approve, 35.9% disapprove. The Governor peaked at 59.1% approve, 37.2% disapprove in Glengariff’s October 2020 survey.

Among independents, Gov. Whitmer is at 39.2% approval to 51.2% disapproval, though the margin of error is higher given the smaller subsample.

Meanwhile, President Joe Biden’s approval rating saw a sharp decline from May. Just 39% approved of his job performance, compared to 53% who disapprove. The intensity of opposition also was strong. While 22% strongly approved of his performance, 44.5% strongly disapprove.

The big decline for Biden came from leaning Democratic voters, where the approval-disapproval gap shrunk to 55% approve, 27.5% disapprove. Biden also is upside down with independents, with 28% approving and 57% disapproving.

The survey showed equally intense motivation to vote among strong Democrats and strong Republicans, both at 9.2 on a 10-point scale.

The survey asked voters about COVID-19 vaccinations. It found 70% of those refusing to be vaccinated identify as Republican, and 30% said their refusal was because they already had COVID-19 and are confident in the natural immunity obtained. Another 17.5% claimed the vaccine was rushed – even though health officials say the U.S. Food and Drug Administration has taken considerable time on the approval process. A further 16.5% said they oppose vaccines.

The survey found by a 57.3% to 35.2% margin, respondents support requiring people to wear masks in public buildings until the Delta variant subsides. Democrats overwhelmingly support mask requirements while independents support them 54.4% to 32.8%. Republicans oppose mask requirements with 25.7% support and 65.2% in opposition.

Respondents also said they favor, by a 55.1% to 38.2% margin, requiring children to be vaccinated for the coronavirus once the FDA approves its use for that age bracket, as is required for polio, rubella, measles, and chicken pox. The poll did not appear to mention that parents can obtain a waiver for their children for religious, medical, or philosophical reasons (the latter requires receiving information in-person from the health department).

A majority also backed local government authority to require masks for children in schools. Just 37.5% said the decision should be up to individual parents, while 35.3% said the state or local health department should decide and 17.9% said the local school district or local school building has authority.

“The polling shows that the last 18 months have exacerbated divisions, and finding consensus on how to best control COVID-19 and move Michigan forward has become even more challenging. That is why events, where business, civic, and government leaders can convene with civility like the Mackinac Policy Conference, are so critical now,” Sandy K. Baruah, president and chief executive officer of the Detroit Regional Chamber, said.

Related: Statewide Poll Reveals Opinions on Underlying Economic Concerns, COVID-19 and Vaccination Perceptions, Voting Rights, Political Landscape


LEO 2021-22 Fiscal Year Budget to Sharply Decrease

The Department of Labor and Economic Opportunity will see a gross funding decrease of 11.6% in its fiscal year 2021-22 budget, largely from a sharp decrease in federal funds provided to the department.

Total LEO funding will be $2.07 billion ($496 million General Fund). This is a decrease of $271.4 million gross funding from the 2020-21 fiscal year.

One-time funding and supplemental appropriations items from the 2020-21 fiscal year were removed totaling $760.7 million gross ($89.8 million General Fund).

Conferees included $135.2 million gross ($16.5 million General Fund) in new one-time appropriations. Among these funds were $100 million in American Rescue Plan funding for community revitalization and placemaking grants. Another $23.75 million gross ($5 million General Fund) will be provided for the Michigan Career and Technical Institute.

Several key bipartisan priorities for economic and workforce development programs as well as the Pure Michigan program were addressed in the budget.

Pure Michigan funding under the agreement was $40 million gross ($10 million General Fund). The funding is meant to help the hospitality sector recover from the pandemic, which has been impacted more severely than other sectors of the economy.

The Going Pro program, which provides grants to employers for job training, would be funded at $40 million gross ($30.5 million General Fund).

The Michigan Reconnect Program was provided $55 million ($50 million General Fund) for the new fiscal year with 12 full-time equivalent employees approved for operating the program.

For the Futures for Frontliners program, a total of $25 million restricted funds was provided for the program which helps frontline workers to attend community colleges tuition-free.

An additional $6 million provided wraparound supports for Michigan Reconnect and the Futures for Frontliners programs.

Total Michigan Enhancement Grants funding of $146.9 million General Fund were to be split among 176 grant projects.

Of these, $10 million would go to the Jackson Intermediate School District HVAC upgrades and other elementary school upgrades, $7 million for the Grand River restoration project in Grand Rapids were the largest individual grants. There was also $1 million provided for Capitol security and $1 million for the Motown Museum.

Michigan Infrastructure Grants funding of $48 million General Fund was set aside to be split between 25 grants.

Conferees and the administration also agreed to include $35 million General Fund for ongoing debt service payments to the Flint water crisis settlement bond.

An increase of $13.08 million federal funds was provided for workforce development programs. This covers expected increases in funding for the Michigan Learning and Education Advancement Program ($5.95 million), the Gaining Early Awareness and Readiness for Undergraduate Program ($4 million), and H-1B workforce development grants ($3.125 million).

A $4 million General Fund appropriation was provided for an unemployment fraud detection contract.

A total of $1 million was included for the Focus: HOPE program to support workforce development, youth development, and community empowerment programs.

Arts and cultural grants were increased by $1.5 million General Fund to $11 million ($9.99 million General Fund).

A new boilerplate section was added to the budget requiring funds for the Good Jobs for Michigan program be distributed as outlined in statute.

Several boilerplate items were included in the LEO budget, including language directing appropriations in the Unemployment Insurance Agency line item be used to support in-person claimant services.

MILITARY AND VETERANS AFFAIRS: For the Department of Military and Veterans Affairs, gross funding will be set at $220.9 million ($78.8 million General Fund), a decrease of $13.6 million gross, or 5.6% ($5.5 million General Fund, 6.6 percent).

Funding totaling $12.4 million ($1.53 million General Fund) was included for the Chesterfield Township Home for Veterans while also increasing federal spending authority from $20 million to $30 million for maintenance, modernization, and environmental projects at National Guard facilities across the state.

One-time funding of $6.5 million for the Grand Rapids Home for Veterans was provided. This consisted of $4.065 million General Fund, $1.83 million federal funds, and $560,000 restricted funds.

Another one-time funding item was $2.5 million ($250,000 General Fund) to consolidate and digitize National Guard records.

LEGISLATURE: Appropriations for operations of the Legislature for the 2021-22 fiscal year were set at $213.8 million ($200 million General Fund). Proposed Capitol security improvements recommended by the governor to implement a ban on firearms inside the building were not included by the conference committee either in funding or in boilerplate.


Talks on Billions Still Available to Continue, Officials Say

MACKINAC ISLAND – Gov. Gretchen Whitmer and the Legislature have succeeded in assuring a budget is in place in time for the start of the 2021-22 fiscal year Oct. 1, but major work on appropriations for the upcoming fiscal year remains.

The budget bills given final passage Wednesday in the Legislature leave available $1.8 billion in the General Fund and $1 billion in the School Aid Fund. Based on monthly revenue reports, the January Consensus Revenue Estimating Conference will likely revise those figures upward to $3.1 billion General Fund and $1.5 billion School Aid Fund.

A shared concern between the Whitmer administration and Republican majorities in the Legislature has been to avoid creating a cliff of spending over which the budget will fall once the revenue surge ends. Gov. Whitmer, speaking to reporters Wednesday, was asked why she will support a budget that spends a fraction of the revenue available and leaves an unprecedented amount of funds on the balance sheet.

The governor pointed to the large investments in the budget. She also signaled there was a need to meet the Oct. 1 deadline.

“We made a huge investment with this budget and we’ve gotten a lot of things accomplished,” she said. “I think the coverage in today’s papers across the state … shows precisely all the different priorities, whether it’s child care, obviously we all know about the education, closing the skills gap, support for small business. We’ve done an incredible amount with this budget. But our work’s not done, of course. I mean, this was a critical time. It’s got to be done before Oct. 1. It’s going to be done before Oct. 1. But we’re not leaving the table and waiting until next year’s budget to continue conversations around the next set of investments.”

Besides the $2.86 billion in state revenues still on the balance sheet, there remains $5.77 billion in federal American Rescue Plan Act state fiscal recovery funds available to spend now, as well as $2.1 billion in ARPA funds that are earmarked for specific purposes.

The successful negotiations on this budget bode well for continued work, Gov. Whitmer said.

“I think that this collaboration we’ve seen around the budget is something I hope that we can continue on and deploy these dollars as quickly as possible in a strategic way,” she said.

House Republican spokesperson Gideon D’Assandro said he did not know the specific timing of future discussions, deferring that question to Rep. Thomas Albert (R-Lowell), the House Appropriations Committee chair.

“But those conversations will begin soon now that the FY22 budget is completed,” he said. “This budget process operates under a strict timeline to make sure essential state services continue uninterrupted for Michigan families. One-time federal and other surplus funding can take a little more time to get it just right.”


Schneider: Incumbents Tough to Beat in Michigan

MACKINAC ISLAND – Matthew Schneider, a former U.S. attorney seen as a potential gubernatorial or attorney general candidate for the GOP some day, said this week that a factor in his deciding not to run for office in 2022 is Michigan’s history of reelecting statewide incumbents.

Michigan governors seeking reelection have defeated their challengers nine out of the last 10 elections going back to 1964. Since the election of James Hare as secretary of state in 1954, only once has an incumbent lost reelection to that office, when Richard Austin lost in 1994. No Michigan attorney general has lost reelection since 1954.

Schneider, when asked by moderator Zoe Clark of Michigan Radio at a Detroit Regional Chamber Mackinac Policy Conference session about the likely election climate in 2022, said the question when it comes to the top statewide races is less about party and more about incumbency. He pointed to 2006, a Democratic wave election that saw then-Governor Jennifer Granholm and U.S. Sen. Debbie Stabenow win landslide victories, Democrats win the state House and flip control of Congress.

But Republican Attorney General Mike Cox and Republican Secretary of State Terri Land won reelection that year, he noted.

“I believe in Michigan those incumbents always fare well, they have historically,” he said.

Schneider, now a top lawyer at the Honigman law firm, said he had several consultants calling him, urging him to run in 2022 and hire them to run his campaign. He then asked them about how to reverse Michigan’s history of reelecting incumbents. They didn’t have an answer.

“I thought, ‘Well this might not be a great sign,'” he said.

Mark Burton, also a recent top hire by Honigman, was asked during the panel about the inherent challenges Gov. Whitmer could face as a Democrat running in 2022 given the usual struggles of the president’s party in midterm elections and the history of Democratic malaise in midterms.

Burton, who was a longtime top aide to Gov. Whitmer, said he thought Gov. Whitmer was well-positioned to blunt those forces and lift Democrats down the ticket in Michigan.

Gov. Whitmer is the first incumbent Democrat seeking reelection with a Democratic president in the White House since 1962.

“It starts at the top of the ticket. I think Gov. Whitmer has got an ability to communicate a set of issues,” he said. “Her superiority as a candidate and a real professional campaign organization … is going to provide the leadership at the top. The party is already unified unlike the Republicans. I actually would feel pretty good about my chances on the ballot.”