Fixing the State's Budgeting Process
The speaker and Democratic House members then spent their summer criticizing the Senate's proposal. They held press conferences and retreats. Various revenue plans have been recently suggested by the governor through the media, but as of September 16th the House has still not voted out a balanced budget alternative to the senate's proposal.
Fixing the State's Budgeting Process
By Sen. Tom George | Special to The Grand Rapids Press
In 1963, following a series of budget problems, Michigan voters adopted a new state constitution which included instructions for the Legislature on how to craft a balanced budget. In two out of the last three years, however, those instructions have been largely ignored by the state house, pushing the state to the verge of fiscal insolvency.
Article IV, Section 31 of the Michigan Constitution reads, "One of the general appropriation bills as passed by the legislature shall contain an itemized statement of estimated revenue by major source. . .the total of which shall not be less than the total of all appropriations made..." In other words, the Legislature in its appropriation process must identify where all the money it proposes to spend is going to come from.
This year, after holding public hearings, the state Senate passed its budget bills in June. Reflecting fiscal realities, the Senate budget bills included broad spending cuts totaling $1.3 billion and the use of some federal stimulus dollars in order to be balanced. The state House, on the other hand, failed to make either sufficient cuts or identify other revenue sources necessary to produce a balanced budget. The House sent to the Senate a package of budget bills which fail the standard set in the constitution.
The speaker and Democratic House members then spent their summer criticizing the Senate's proposal. They held press conferences and retreats. Various revenue plans have been recently suggested by the governor through the media, but as of September 16th the House has still not voted out a balanced budget alternative to the senate's proposal.
The House is able to get away with ignoring the intent of the constitution because as written the provision applies to the "legislature," which technically includes both chambers combined, not each chamber separately. It is unlikely though, that the framers of the state constitution intended for one chamber to wiggle out of the balanced budget requirement.
Compounded with the lack of revenue, this failure of the House to complete its part of the budget balancing process has made a bad situation worse. Adopting clearer budget rules would both add transparency to the process and lessen the chance of a government shutdown. Though clearer rules would not create more revenue, they would lead to more predictability for entities like local governments, school districts, colleges, universities, and hospitals which are all partly dependent on state funding.
The Legislature can add framework to the constitution's instructions by adopting a resolution I have introduced, Senate Concurrent Resolution 21, which would hold each chamber separately responsible for passing a balanced budget plan by June 1. Doing so would force any proposed revenue increases or spending cuts to become public and would allow plenty of time for subsequent negotiations between the two chambers.
In 1984, the National Council of State Legislatures Advisory Commission on Intergovernmental Relations evaluated state balanced budget requirements. Twenty-six states had more stringent balanced budgeting requirements than Michigan. It is time to fix Michigan's budgeting process.
Tom George is a state Senator from Kalamazoo and a Republican candidate for governor.
Posted: 9/24/2009