by Gongwer News Service
August 7, 2009

While talk flies around the Capitol about saving money by letting prisoners out early and renting out prisons to other states, and other rumors have Michigan shrinking its departments down to eight, it’s still not clear how policymakers plan to bail Michigan out of a nearly $2-billion-and-growing budget deficit.

What is clear is that many groups don’t want to get stuck in the fray. Coming out over the past week to speak out against getting their budgets slashed any further, groups that represent the arts and social services said they have already taken more than their share of hits and can’t afford to take any more of the burden of the recession.

Saying balancing the budget on the backs of the poor would be “a moral and legislative failure,” several advocacy groups said during a press conference that while they can’t stop huge cuts that have already been made, lawmakers should not slash services to the poor any further.

Most of the groups represented said while they have no solid suggestions for how to fix the budget crisis, increased state revenues probably need to be part of the picture.

When asked by a show of hands how many in the group of about a dozen representatives from organizations such as the Michigan Catholic Conference and the Michigan League for Human Services would be OK with increasing the beer tax to raise revenue, a majority of members showed support.

League President Sharon Parks said she supports a beer tax increase and a complete tax structure overhaul, a plan for which her organization has an outline on its website.

Some of the suggestions include closing what they deem tax loopholes, such as ending sales tax exemptions for vending machines. In total, closing the “loopholes” would bring in $332 million, based on 2007 projections.

However, Paul Long, vice president for public policy at the Catholic Conference, reiterated that the press conference wasn’t about directing lawmakers toward solutions for the nearly $2-billion budget gap; it was simply a call that “the state can no longer continue to tear apart the state’s social safety net to resolve the budget deficit.”

First, they said, Governor Jennifer Granholm made executive order cuts, of which more than half were in the Department of Community Health and the Department of Human Services. Those two departments are primarily responsible for ensuring services to low-income residents and children, and now there are proposed cuts that would make the 48-month time limit on cash assistance retroactive and add a freeze on the earned income credit.

Then there’s the Senate’s passed FY 2009-10 DHS budget that would cut 29 percent of the department’s general fund and the Senate’s DCH budget that would cut nearly 25 percent of that general fund.

“Enough is enough,” is the message of the day advocacy leaders said they hoped the public would share with the legislature.

“The cuts proposed to date affecting low-income families are simply too harmful,” said Ms. Parks. “We cannot balance the budget on the backs of poor families. We need to paint a brighter future for our kids.”

She added that this is the worst possible time to make cuts, since the state started at such a low point, having been shredding the budget for social services for nine years in a row. In addition, said Ms. Parks, as the number of unemployed people rises, the number of residents on cash assistance should increase as well, which isn’t the case.

“You have to ask yourself how those unemployed families are surviving,” she said.

While Senate Majority Leader Mike Bishop (R-Rochester) said he sympathizes with human services groups’ concerns about the impact of the cuts on the social safety net, he said the state simply cannot keep spending at previous levels as revenues plummet. “This is a crisis situation,” he said in noting a precipitous fall in general fund revenues of 25 percent since January.

Senate Republican systematically identified spending priorities and cut across the budget, not just in social programs.

For example, the governor, by executive order, dismantled the Michigan library, which brought several hundred genealogists in protest to the Capitol lawn the same morning of the press conference on social service cuts.

Speakers at the protest said Michigan and the governor should be ashamed at an attempt to break up the Department of History, Arts and Libraries.

Speakers also said the effort to break up the department’s functions, and the threat to the library’s collection, breaks the spirit of the promise the state library and museum building represented when it was opened in the 1980s.

When the new building opened, then-Secretary of State Richard Austin told the public that the museum/library center was a “lasting legacy, a gift to later generations,” genealogist Shirley Hodges told the crowd.

Some 300 people, including Civil War re-enactors and individuals dressed in colonial costume, attended the rally and then marched to the museum center, where they joined others to ring the building.

Rep. Rick Jones (R-Grand Ledge) and Rep. Joan Bauer (D-Lansing) both pledged to the rally that they would do everything they could to preserve the library’s more than 5-million-piece collection.

Ms. Bauer said she was also concerned about preserving the museum/library building. In Executive Order 2009-36, the governor created a board for a new Center for Innovations and Reinvention, and there is concern that group would attempt to restructure the building, including moving the Michigan State University Museum into the center.

Mr. Jones drew cheers when he said to help save money, supporters of the library would be willing to close the facility and seal the collection for a period of time, so long as the collection was not broken up.

Both Mr. Jones and Ms. Bauer, however, used their comments to talk about other issues. Mr. Jones urged support for his effort to prevent the state from going ahead with a lease on a new Department of State Police headquarters building. Ms. Bauer said the state had to be willing to look at raising revenues, though not necessarily by increasing taxes, to help forestall drastic cuts.

J. William Gorski, who spent 30 years accumulating a collection of materials about Polish residents in Michigan before donating it to the library, blasted Ms. Granholm and the legislature, saying they should be ashamed of themselves for calling for the breakup of the library and the state’s cultural facilities.

Liz Boyd, Ms. Granholm’s spokesperson, said the governor “values the collection and the resource the collection provides” to the public. The situation regarding the library and museum is fluid and a final decision on the library has not been reached, but any final solution has to ensure the collection is accessible.

She said the executive order would be implemented to start the process on making a new determination on the library and museum. State government “cannot be all things to all people,” she said.

However, even though Mr. Bishop helped make the cuts in these “dire times,” he seems to think more transparency about revenue proposals may be the salve people need for the wounds caused by such deep cuts, calling on Ms. Granholm to make public her revenue proposals.

Mr. Bishop declined to identify the proposals Ms. Granholm had made in private meetings she has held with legislative leaders as they seek an agreement on a 2009-10 fiscal year budget. He said it was Ms. Granholm’s proposal and she should be the one to reveal it.

“The public needs to know what the options are,” Mr. Bishop told reporters.

Noting that the Republican-led Senate passed a budget with about $1.2 billion in cuts, Mr. Bishop said it is incumbent on Ms. Granholm to reveal her revised plan so residents and interest groups can weigh the alternatives.

The falling revenues have helped to create a $2.7-billion combined general fund/school aid fund shortfall in the budget that Ms. Granholm recommended in February. When federal stimulus money is included, the deficit drops to under $2 billion.

Ms. Granholm and the legislative quadrant is expected to meet again next week to continue discussions of how to create a balanced 2009-10 budget.

But Mr. Bishop also said the meetings are nothing like the ones leading up to the 2007 budget stalemate that led to a temporary shutdown of state government.

“We’ve learned from what happened in the past,” he said. “We are in a position to close this deal before the budget deadline.”

Ms. Boyd said Ms. Granholm preferred to keep the proposals she has made private during this phase of discussions.

“If something is deemed not acceptable to the parties, we’re not certain how much value there is in having a public discussion about it,” she said.

Airing proposals now could jeopardize reaching an agreement, Ms. Boyd said. “I think the public does want to know, but I think the public wants the situation resolved,” Ms. Boyd said.

The sides have agreed to keep the negotiations private, and Republicans should honor that agreement, Ms. Boyd said. However, Mr. Bishop said he thought keeping the discussions private two years ago helped contribute to the shutdown.

Like Mr. Bishop, Ms. Boyd voiced optimism about a solution. “I think we’re on our way to resolving this budget deficit,” she said.

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