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Published: Thursday, 9/30/2010

Michigan has run out of budget gimmicks

LANSING, Mich. - The one truly funny moment in the long, drawn-out budget battle came after everything had finally been passed. When the chamber adjourned Wednesday night, House Majority Leader Kathy Angerer (D., Dundee) proclaimed: "We have completed the budget long before the deadline," and her fellow lawmakers applauded.

Time is relative, of course. In this case, completing the budget long before the deadline meant a little over one day before the state legally would have had to shut down.

Given that the Legislature's leaders originally vowed to have the budget done by June 30, it's not clear how much applause was in order. Nor was waiting until almost the last minute to pass the budget the worst of it.

True, it inconvenienced schools, cities, and others waiting to see how much money they would get from the state. But the real tragedy and failure lie not in what the Legislature did, but in what it once again did not do.

Lawmakers failed to tackle the massive reforms of the budget process that are deeply needed. Instead, they used federal money to plug a growing budget hole, and left the next governor and Legislature with a huge problem.

Thanks to term limits, nobody in a leadership position will be around next year. The architects of the current budget won't have to deal with the consequences of their work - a projected $1.6 billion deficit.

Regardless of which party controls Congress next year, the state lawmakers who will have to deal with that deficit almost certainly won't have any federal stimulus money to help fill the gap.

They won't have much experience, either. As a result of term limits, the governor, more than half of the state House, and almost the entire Senate will be new. Lawmakers will have to make cuts so huge that they will drastically change what government does in Michigan, or they will considerably increase taxes.

Logically, they will do both. They will no longer have a choice. For years, lawmakers have used up funds, engaged in accounting tricks, and sold state assets to avoid tough decisions.

That won't be possible any longer.

Michigan's budget year starts today, three months after the beginning of the normal fiscal year. That's the result of an accounting gimmick in a long-ago budget crisis. School systems and cities that depend on funding from the state have to complete their budgets three months earlier, without knowing how much they can count on from Lansing.

There are good things about the budget that just passed - good, at least, in the short term. Lawmakers restored money to schools that was cut last year - at least $154 per student in every district, more in some lower-spending ones.

Poor children who qualify for Medicaid will get vision, dental, and podiatry services, which they lost last year. Colleges and universities took a 2.8 percent cut in this budget, but that was less than they had feared when the year began.

Corrections took a $42 million cut, too. Although lawmakers told authorities not to close a prison, the reality is that they will almost certainly have to close one anyway.

The good news is that there are about 7,000 fewer inmates than there were a few years ago. Closing a prison shouldn't be that hard.

In a development that dismayed most civic leaders, because of the political influence of the billionaire who owns the Ambassador Bridge, Matty Moroun, the project to build a new international bridge across the Detroit River is stalled for now.

Otherwise, lawmakers mostly avoided doing what they should have done, and left instead a ticking time bomb for the next governor and Legislature. They needed to make major reforms in the way the state gets and spends money.

But they didn't. They mostly didn't have the guts or the political will. That wasn't completely true. Lawmakers reformed the public school employee retirement system in a sensible way, though teachers' unions will fight it in court.

Lawmakers made a stab at doing the same for state employees, requiring them to pay 3 percent of their wages into a health-care trust. But they only found the votes to pass this change as a three-year temporary measure. Making it permanent or fighting to extend it will be the problem of the next governor and Legislature.

Whoever is elected will face enormous financial problems. In an odd twist, the Legislature did a little something that may help next year. In almost their final act, lawmakers voted to legalize the sale of alcoholic beverages on Sunday mornings.

Maybe they were trying to tell us that we're going to need it.

Jack Lessenberry, a member of the journalism faculty at Wayne State University in Detroit and The Blade's ombudsman, writes on issues and people in Michigan.

Contact him at: omblade@aol.com



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