Michigan Projects "Staggering" Drop In Tax Revenues
May 16, 2020
By Jessica Mathews/News@whmi.com
State revenue declines from the coronavirus pandemic are expected to present enormous challenges for the state budget.
Legislative experts and top officials in Governor Gretchen Whitmer’s administration agreed to revised budget estimates Friday. A $3.2 (B) billion decline is being projected in combined general fund and school aid fund revenues in 2020. Analysts forecast a combined revenue loss of $6.3 billion in 2020 and 2021. The multibillion-dollar declines in tax revenue combine with record-high enrollment in government health insurance programs. State Budget Director Chris Kolb said the decline presents an "enormous challenge" for the state budget. The Whitmer administration is calling on Congress to send aid to the state. During a press conference Friday, Governor Whitmer called the numbers “grim” but wouldn’t speculate on possible cuts. She said it’s a critical moment and some sort of assistance is needed from Congress.
Republican State Senator Lana Theis of Brighton Township issued the following statement after the Consensus Revenue Estimating Conference: “Today economists confirmed what we have expected — the impact to Michigan’s economy from the state’s response to the coronavirus is deep and wide. There is no way to sugarcoat the fact that we now face some very tough decisions concerning the state’s budget and the programs and services that rely on its funding. Everything from schools, roads, police and fire departments, to other critical government services are facing dramatic shortages. Balancing this year’s budget and funding these priorities will be hard, but we’ll get it done. This economic toll largely caused by the governor’s actions didn’t have to be as bad as it is. Continuing to impose stay-home orders and rules that no longer make sense will only make things worse, both for the economy and budget, and for the state’s residents. The sooner we can work together as one Michigan and implement policies that let people get back to work and living their lives as safely and as quickly as possible, the better and safer all Michiganders will be. I believe we can, and, for the sake of our state, we must.”
Livingston County Democratic Party Chairwoman Judy Daubenmier countered those thoughts and issued the following statement to WHMI: "Governor Whitmer has been laser-focused on protecting the health and saving the lives of her constituents. Her stay-at-home orders have been among the few tools we have to stop the spread of this disease, and they have been working. That's why we have seen the governor begin to take steps to let parts of the state's economy ramp up again. But those decisions should be made based on what the data and the health experts say is happening with the virus. The scientists are telling her that opening up too soon will mean losing the progress we have made and result in more, needless deaths. Now we need the federal government to step up and help state and local governments with the budget crises they are all facing. Lana and her party could help by asking Mitch McConnell to provide aid to state and local governments to avoid cuts in programs that are needed now more than ever. Instead, Lana wants to live in a fantasy world built by Donald Trump and the Michigan Chamber of Commerce where science doesn't matter and the virus magically goes away. But polls show 72 percent of Michigan residents agree with the governor's approach. They don't want to have to choose between staying healthy and going to work. Lana shouldn't force them to choose."