Shaping Michigan’s Economic Future Through the 2026-2027 State Budget 

As Michigan’s Gov. Gretchen Whitmer, Senate, and House begin negotiations for the fiscal year 2026-2027 state budget, securing investments in talent, infrastructure, and economic development is paramount. With Michigan ranking 40th nationally in per capita income and the Detroit Region facing lagging population growth, the 2027 budget must prioritize policies that foster a competitive business climate and build a resilient workforce.  

As budget negotiations ramp up after May 15 during Consensus Revenue Estimating Conference (CREC), the Detroit Regional Chamber urges legislators to keep these priorities in mind.  

Related | Lansing Budget Updates: Critical Talent and Economic Programs Face Divergent Paths 

Fully funding the Michigan Achievement Scholarship and restoring Going PRO to $55 million are key components of achieving a 60% post-high school educational attainment rate by 2030. Currently, 69% of all Michigan jobs will require education beyond high school by 2031, yet only 35 of 100 ninth graders in the Region earn a degree within six years of post-high school enrollment. Building this foundational talent pipeline is essential for employers to fill high-wage jobs and reverse the state’s decline in per capita income.

For the Michigan Achievement Scholarship, the Governor, Senate, and the House recommend a $232 million increase to match anticipated expenditures as more students become eligible.

For Going PRO, the Governor’s recommendation completely eliminates the program, as does the Senate, while the House recommends $40 million.

Dual enrollment serves as an economic competitiveness strategy that must scale to produce more skilled workers in high-demand sectors such as mobility, health care, IT, and advanced manufacturing. In the 2022-2023 academic year, about 7% of Michigan high school students participated in dual enrollment, well below the national average of 22%. Participating in these programs accelerates entry into high-demand careers, allowing students to earn transferable credits, shorten their time-to-degree, and reduce student debt. Legislators must create a permanent, dedicated dual enrollment fund to cover the cost of student enrollment rather than drawing from local per-pupil allowances, ensuring better outcomes across all communities.

The Governor recommends a new $20 million one-time appropriation to reimburse high-poverty districts for student costs of dual enrollment. The House proposes doubling that to $40 million and expanding eligibility to include work-based learning and early middle college programs. The Senate recommends the highest investment, proposing $60 million for dual enrollment funding.

The sheer lack of funding for economic development tools across all budget recommendations is disappointing. The state needs attraction tools to incentivize large developments, as well as dedicated site-readiness funds. Furthermore, investments in attracting special events and national conventions serve as immediate economic multipliers, driving revenue to local hospitality sectors while showcasing Michigan’s capacity to host global talent. Equipping the state with comprehensive tools for attraction, site readiness, and tourism-boosting fosters the confidence employers of all sizes need to invest, grow, and hire in Michigan, ultimately supporting long-term regional prosperity.

The House budget proposes sweeping lapsed funds from the Michigan Strategic Site Readiness Program, the Strategic Outreach and Attraction Reserve (SOAR) Fund, and the Critical Industry Program into a newly created Legislative Spending Transparency Fund to support $150 million in legislatively directed spending.

Conversely, the Governor and Senate budgets recommend a $60 million one-time allocation for business attraction, community revitalization, and the entrepreneurial ecosystem. Additionally, the Senate includes $6 million in one-time funding specifically designed to attract special events and national conventions to the state. The Governor recommends $150 million in one-time funding for the Strategic Site Readiness Program.

Maintaining tax competitiveness and policy stability is foundational to economic growth. The legislature must thoroughly evaluate the recent property tax cut legislation, which reflects Speaker Hall’s bold vision to make Michigan more competitive. Furthermore, implementing measures such as recoupling federal tax savings from OBBBA, which the state decoupled from in October, is essential. Given the Detroit Region’s dead-last ranking among peer regions in per capita income, Michigan must prioritize a stable economic environment.

The Governor’s budget proposes substantial fee increases, including a hike to the landfill tipping fee and significant increases to water and hazardous waste permit fees. The Governor also relies on new projected revenues from taxing vaping products, digital advertising, and internet gaming.

The House and Senate reject all proposed environmental fee increases and the increased taxes on vaping products, digital advertising, and internet gaming.

Investments in STEM programming, such as the 99h robotics grants, bolster the future talent pipeline and prepare students for the 21st-century tech economy. By supporting targeted training and early exposure to robotics, the state can create a more resilient workforce that meets the specific demands of the mobility and advanced manufacturing sectors.

The Governor recommends maintaining funding at current levels, allocating $5 million to standard programs and $600,000 to nonpublic schools. The House concurs with the Governor, maintaining these exact funding levels without increases. The Senate, however, recommends an increase of $1 million for general 99h grants and a $120,000 increase for nonpublic schools.

The Chamber applauds the legislature and the Governor for moving this early on the state’s budget. From here, the CREC on May 15 will determine the actual amount of money the state has available, which will then allow final negotiations to take place.

The Chamber hopes negotiations can move swiftly, and a budget can be signed on the Grand Hotel Porch during the 2026 Mackinac Policy Conference.