LANSING, Michigan — Gov. Rick Snyder proposed a $54 billion state budget on Wednesday that he said prioritizes education and health services, including focus on improved reading for third graders, more training in the skilled trades and increased dental coverage for low-income children.
The Republican governor's plan for the fiscal year starting in October would increase spending by roughly $2 billion, or 3.8 percent, mostly because of higher federal funding.
Key provisions include a $75 increase, or 1 percent, in the state's minimum per-pupil funding for K-12 schools, though school districts could receive more if they meet "best practices" standards. It also includes a nearly 2 percent increase in aid to Michigan's universities if they keep tuition hikes to no more than 2.8 percent.
Snyder also proposed providing dental coverage to low-income children in Wayne, Oakland and Kent counties — the last three counties not participating in the Healthy Kids Dental program. He did not call for a statutory increase in state revenue sharing with local governments, except an increased required by the constitution.
He said about 76 percent of the total budget is dedicated to education and health and human services.
"We should be proud. Michigan's strong. We're making strong investments and we're doing it together," Snyder said during his presentation to the Republican-led Legislature's budget committees.
Snyder also issued an order addressing a $289 million shortfall in the current budget caused primarily by higher-than-expected business tax credit claims, a problem that also impacted Snyder's new budget. The order includes nearly $103 million in cuts across state agencies, the largest coming in the biggest agencies such as Corrections, Community Health and Human Services but also in the State Police.
Community colleges would be paid out of the school aid fund instead of the general fund, saving $167 million.
Snyder said the state must get a better understanding of when companies are going to claim their credits. He eliminated new credits under a business tax overhaul that went into effect in 2012, but his administration also has amended old credits that predominantly were granted during Gov. Jennifer Granholm and Gov. John Engler's terms.
Democrats raised concerns over Snyder's K-12 funding proposal, saying the $75 per-pupil increase might not be enough for some districts because he wants to cut or eliminate some other one-time sources of money for schools.
"It's one thing to say it's a $75 increase in total, but if not every school district is seeing an increase and they're seeing cuts, then I think it's an irresponsible use of school aid fund to solve other budget problems," said Rep. Sam Singh, an East Lansing Democrat.
Among the governor's priorities is third-grade reading, considered an education benchmark because it's when students transition from learning to read to reading to learn. Snyder also is focusing the start of his second term on getting more funding for skilled trades and career technical education.
He also wants to implement a kindergarten entry assessment to gauge the effectiveness of the state's early childhood spending.
Republicans, who control the House and Senate, want to finalize the budget in early June, four months before the fiscal year begins. But they are expected to sign off on the mid-year cuts sooner.
The proposed budget does not assume passage of a May 5 statewide ballot measure that would raise the state sales tax to 7 percent from 6 percent as part of a plan to pump $1.3 billion more a year into road and bridge construction and public transit. If the proposal is passed, Snyder and lawmakers could enact supplemental budgets to reflect the additional spending.
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