By Tim Martin
Associated Press
LANSING (AP) -- Republicans who will dominate the Michigan Legislature starting in January figure voters sent them a clear message in the 2010 election:
--Make it easier for businesses to operate and create jobs in Michigan, a state saddled with one of the highest unemployment rates in the nation.
--Fix a deficit-prone state budget with some bold action, and do it without the political bickering that led to a short partial government shutdown in 2007 and another missed deadline in 2009.
Easier said than done.
Michigan's bleak economy has driven down state tax revenues over the past decade, making it tougher for state lawmakers to balance the budget and provide the support needed for schools, social services and other programs that residents depend on across the state. The job will be even more difficult in 2011, when the extra federal assistance provided the past few years expires. That will contribute to a projected state budget deficit of roughly $1.7 billion for the fiscal year that starts in October.
"I didn't sign up for this job because it was easy. I signed up for this job to do it," said state Sen. Randy Richardville, a Republican from Monroe who will become Senate Majority Leader in January. "Yes, there are going to be a lot of difficulties out there. But the people sent us up here -- they put a lot of trust in us, they gave us clear direction in November, and now they're going to evaluate us in a relatively short period of time. So they're expecting tough decisions."
Republicans will have a 26-12 advantage over Democrats in the Senate starting in January, building on an edge they have had since the mid-1980s. Republicans will have a 63-47 edge in the House, where Democrats held the majority the previous four years. They'll also control the governor's office, with Rick Snyder's election in November.
Republicans defeated nine Democratic incumbents in state House races in November -- a staggering number, since incumbents rarely lose in the Michigan Legislature.
Reshaping and simplifying the state's business tax structure in an effort to spark investment is a top priority, but the specifics of how that will be accomplished haven't been worked out.
"We cannot make it more expensive to provide a job in Michigan, or raise a family in Michigan, or we will continue to chase both away," said Rep. Jase Bolger, a Republican from Marshall who takes over as House speaker in January.
Republicans say increases in tax rates approved by the Michigan Legislature in 2007, including a higher income tax rate and a surcharge on the state's main business tax, didn't work as overall state tax revenue continued to fall. The result has been stagnant support for education and cuts to other programs, including the cash that goes to local governments to pay for police and fire departments.
Michigan's budget cutting made it the only state in the nation to shrink its general fund spending between 2001 and 2009, according to the National Association of Budget Officers. The share of the state budget paid for with state tax revenues dropped by about $1 billion during outgoing Democratic Gov. Jennifer Granholm's eight years in office.
More budget cuts will be needed in the upcoming fiscal year and possibly beyond. That has the schools, agencies and special interests that rely on money from the state nervous.
The Michigan League for Human Services issued a report this month summarizing how unemployment has risen, poverty has increased and the state's ranking for median household income has fallen over the past decade.
"This report shows that the need is great for services to vulnerable people," the Michigan League's Karen Holcomb-Merrill said in a statement. "Michigan lawmakers will be tasked with providing those services at a time when the ability to pay for those services is compromised. A balanced approach is needed now more than ever."
Democrats will push for that balance. Incoming Senate Democratic Leader Gretchen Whitmer of East Lansing and incoming House Democratic Leader Richard Hammel of Mount Morris Township in Genesee County both say their caucuses can work well with Republicans and remain relevant to the state's decision-making process.
Hammel said lawmakers from both parties already have shown they are committed to making state government more efficient, based on cuts approved in recent years.
"Nobody wants to make these horrible cuts that we've made," Hammel said this month at a forum sponsored by The Center for Michigan and Business Leaders for Michigan. "I don't care what party you're from, nobody wants to do it. But at some point we have to balance the budget."
All four of the Legislature's top leaders will be new to their leadership positions next year, taking over for lawmakers who are leaving office because of the state's term limits law.
Outgoing Democratic House Speaker Andy Dillon will be the treasurer in Snyder's administration, an appointment that showed the new governor is trying to be inclusive as he builds his team to run Michigan. Dillon urged lawmakers to be bold but compassionate as they sort out the state's budget problems over the next few years.
Dillon and outgoing Republican Senate Majority Leader Mike Bishop managed to balance the state budget as required by the constitution, but it wasn't pretty getting there and it sometimes required massive infusions of federal money to make ends meet. Lawmakers never came up with a long-term strategy to address the state budget's structural problems during the Dillon-Bishop era, but did pass some new laws that could help save the state money over the long haul -- including retirement system changes for state and school employees.
Changes in energy, education and economic incentive policies -- including those targeting the advanced battery business -- could pay off for the state down the road. The twists and turns appearing in the short term are bound to be tough to navigate for incoming lawmakers.
"We have served during arguably the most difficult time in our state's history," Bishop said in his going-away speech to colleagues. "And the years to come don't look any easier."
Published: Wed, Dec 22, 2010
