UNDER THE DOME

Capitol Update, February 7th-March 12th, 2009

Cynthia Ann Paul

 

Mark Your Calendars- SEIU Local 517M and Local 1 will be holding their annual lobby day on May 7th. Local 517M will be lobbying on the issues of: Public Service Accountability, increasing the revenue sharing and allowing non-instructional school employees to once again negotiate issues of contracting out. SEIU Local 1 will be lobbying on the issues of justice for janitors and redlining.

Dueling Employee Free Choice Act Resolutions-

Senate Resolution 16- The Senate passed a non binding resolution memorializing Congress to oppose the Employee free choice act. It passed along a party line vote.

House Resolution 10- The House passed a non binding resolution indicating support for revisions to federal labor laws, known as the Employee Free Choice Act. It passed 67-40, with Rep. Rocca joining the Democrats. SEIU launched a electronic letter writing campaign on this issues please take action at:

http://seiuaction.org/campaign/EFCASEIUMI2009

Please take action on SEIU's ergonomic electronic letter writing campaign at

http://seiuaction.org/campaign/ergonomics09_clone

House Mortgage Package- Homeowners facing foreclosure would have 90 days to see if they could work out a modification to their loan with their lender under a legislative package passed out of the House and has been sent to the Senate. House Bill 4453 passed 73/34, House Bill 4454 passed 75/33 and House Bill 4455 passed 74/34. Upon receiving notice of a foreclosure, the homeowner would be provided information on how to contact a housing counselor. The House Democrats said that they will soon be introducing a moratorium on foreclosure.

DOC Nurses- House Bill 4248 exempts retired Department of Corrections nurses from the state’s double-dipping statute. This passed the House 98/6 and has been sent to the Senate

Hire Michigan First- A 12- bill package that would require state contracts and economic development efforts to focus hiring on Michigan residents passed the House after being reported on a largely bi-partisan basis from the House Commerce Committee. A similar package cleared the House in the last session, but failed to move in the Senate. Senate Democrats are introducing companion bills.

Unemployment Insurance Solvency Bill- House Bill 4239 would give Michigan companies a break on paying the unemployment insurance solvency tax. The bill could save as many as 40,000 companies in the state as much as $35 million a year in solvency tax payments to cover the interest on those loans. This legislation passed the House and the Senate and was signed by Governor Granholm, (PA 1).

The State Administrative Board officially selected a New Contractor for Health care services- for Michigan's prisoners- Prison Health Services was named to take over the system from Correctional Medical Services, which has provided health care for the state’s prisoners for some 10 years. The new health care provider for the more that 49,000 prisoners takes over operations on April 1. Prison Health Services already provides health care coverage for inmates in 23 states.

Dropout Age Raised to 18- House Bill 4030 and House Bill 4132 raise the dropout age to 18 passed the House and has been sent to the Senate.

Meadows Moves His Public Employee Retirement Package- A package of bills related to changes in the way state and local units of government fund employee retiree health care benefits and how the state retirement systems are administered passed the House they included the following:

1) House Bill 4071- Moves the administration of the Legislative Retiree group health plan to the Office of Retirement Services (ORS), changes to the plan would be authorized by the Legislative Retirement Board.

2) House Bill 4072 - Move the administration of the State Employees Retiree group health plan to the Office of Retirement Services (ORS). Changes to the plan will have to be authorized by the Civil Service Commission the Retirement Board.

3) House Bill 4073- Creates an act to authorize and create an irrevocable trust for the purpose of holding, investing, and distributing assets to be used by state employee retirees, it sets up an IRS 115 trust. This does not include the health savings accounts and does provide retirees a contractual right to the benefits.

4) House Bill 4074- Allows municipalities to support issue of securities with general fund, but specifies no additional tax may be issue for municipal security, where securities are issued without voter approval. Tie barred to and in conjunction with HB 4075.

5) House Bill 4075- Allows counties, cities and villages or townships to issue municipal securities without voter approval for the purposes of paying for the unfounded accrued retiree healthcare liability. Tie Barred with HB 4074. This eliminates the Mussleman language and provides a contractual right to healthcare benefits to retirees.

6) House Bill 4076- Changes membership on retirement board to exclude retiree members whose departments are already represented. Adds one additional member, one from retired employee group and one from active employee group.

7) House Bill 4077- Essentially is a collection of definitions for terms referenced in HB 4074 and HB 4075.

8) House Bill 4078- Moves the administration of judges retiree group health plan to the Office of Retirement Services (ORS). The Judges' Retirement Board, DMB, would authorize changes to the plan.

9) House Bill 4079- Moves the administration of the State Police Retiree group health plan to the Office of Retirement Services (ORS). The Civil Service Commission, Retirement Board and DMB would authorize changes.

SEIU provided testimony before the Commission on Govt. Efficiency on March 2, 2009- It was a combination of responding to the most egregious recommendations currently before the commission, encouraging them to get more information (their second charge) on them before implementing. We also recommended amending the Civil Service Whistleblower rule to include waste, fraud and inefficiency; look at the number of management in state departments and come up with a formula to ensure the appropriate level of management to employees; adopt a program to incentivize employees to come with ideas to save the state money (like DOT Bright Idea program) and pass the public service accountability act. John Eck also provided very thorough testimony on how the DOT can save $40-million by bringing routine design, engineering and testing back into the state.

Federal Level:

Stimulus Package- The American Recovery Reinvestment Act (ARRA) HR 1 conference report passed the House on a 246/183 vote. It totals $787 billion and includes a $400 tax cut for individuals and an $800 tax cut for couples. Michigan’s congressional delegation split their votes along party lines: eight Democrats supported the measure while seven Republicans opposed it. Overall, eight Democrats in the chamber opposed the bill, which garnered zero support from the Republican caucus. The bill passed the Senate, both Michigan Senators support it and President Barack Obama signed the legislation on March 17, 2009. Here is a breakdown of the rest of the money Michigan would receive under the package, as provided by the Federal Funds Information for States:

• $1.3 billion for “fiscal stabilization” for education
• $845 million for highways and bridges
• $500 million for Title I funding for education, which goes toward lowering student-to-teacher ratios and for early childhood programs
• $419 million for special education
• $293 million for general purpose spending in education
• $279 million for weatherization
• $171 million for clean water
• $165 million for capital grants for transit
• $101 million for local law enforcement grants
• $87 million for dislocated workers
• $74 million for youth health under the Workforce Investment Act
• $67 million for drinking water
• $58 million for child care
• $53 million for homeless prevention
• $49 million for mortgage loan assistance
• $43 million for public housing
• $36 million for community services
• $31 million for adult health programs
• $23 million for educational technology
• $21 million for Head Start programs
• $16 million for vocational rehabilitation
• $16 million for unemployment insurance administration grants
• $14 million for employment services
• $5 million for emergency food and shelter
• $4 million for commodity assistance
• $3 million for elderly nutrition

A great piece on this package can be found at the Michigan League for Human Services-http://www.milhs.org/Media/EDocs/MIsStimulusPKG09Revised.pdf

Budgets-

Revenues for 2009-10 in the general fund budget were forecast to be about $1.2 billion less than anticipated expenditures. Granholm’s budget handles the shortfall in the general fund budget with $506 million in cuts, $166 million in additional revenues and $500 million in enhanced federal Medicaid monies as part of the federal stimulus package. To cover the anticipated $229 million shortfall in the School Aid Fund, Granholm calls for spending cuts of $164 million, most from a $59 per pupil cut in the foundation allowance, and additional revenues of $65 million.

The budget forecasts total combined spending of $44.2 billion. The total combined budget for the current 2008-09 fiscal year is $44.5 billion. The general fund budget would total $8.9 billion for 2009-10, compared to the $9.4 billion budget for the current year.

Other budget cuts include:

· $100 million cut to universities;

· eliminating some human services programs like after school programs;

· eliminating arts and cultural grants;

· collapsing the Cooperative Extension Service and Agricultural Experiment Station together;

· eliminating one State Police forensic laboratory (Marquette);

· eliminating one of the few remaining state institutions caring for the developmentally disabled; and

· ending state support for the horse racing industry;

· eliminating the DEQ's wetland regulation program; and

· eliminating the DEQ's air quality's asbestos regulation and outreach and education.

Ms. Granholm will also ask state workers for $28 million in concessions which come on top of the workers not getting a pay raise this fiscal year totaling $50-million.

Revenues- Included in the Governor's recommendation are several adjustments, including new tax laws in 2008 that kick in for the new fiscal year. One, worth $334.8 million, erases a tax on providers of Medicaid services, and instead imposes a use tax on those services. The provider fee can no longer be used for matching federal funds, and the new tax can. Other additional revenues come from charging the School Aid Fund for short-term borrowing costs, liquor fees, plus a number of other fee and tax increases. Several changes in the Michigan Business Tax will mean a loss of $9.5 million in revenue. Another proposal would double the tobacco taxes charged on non-cigarette tobacco items and publicly embarrass delinquent taxpayers.

Current-year school aid fund revenues are expected to be 1.3 percent below last year, and in 2009-10, they are projected to drop another $78 million to $11.29 billion.

Other revenue proposals include:

· $10 million by overturning a 2002 Supreme Court decision on commercial rental property.

· $14.5 million by taxing some interstate and international communications.

· $21 million by ending the practice of exempting sales taxes on interstate trucks and parts for those trucks, by assessing taxes based on how many miles are driven in Michigan.

· $4.1 million by ending the double deduction claimed on income from oil and natural gas royalties.

· $12 million by ending the sales tax bad debt deduction.

· $3.1 million by changing the sales tax collection allowance.

· $3.2 million by changing the tobacco tax collection allowance.

· $11 million by boosting compliance of delinquent business accounts.

· $4.1 million by expanding the use of income tax automation to correct tax errors.

· $2.5 million by starting a system of sending letters to businesses to remind them f their use tax liability.

THE 2009-10 BALANCE, BUDGET SUMMARY

Here is a look at the 2009-10 Budget Balance summary (amounts in millions):

	Gen. Fund	All Funds
Beginning Balance	$0.0	$541.1
Revenues:	$ 7,934.5	$43.403.5
Proposed Adjustments:
Revenue Sharing Reductions	$466.8	$466.8
Charge School Aid Fund for Short-term Borrowing	$45.0	$45.0
2008 Business Tax Changes	-$9.5	-$9.5
Replacing Medicaid Provider Tax with Use Tax	$334.8	$334.8
Liquor Revenue deposit	$24.1	$24.1
Revenue Enhancements	$129.1	$174.9
Tax Enforcement	$13.2	$17.6
Increased Lottery Sales Staff/Ads		$15.0
Total Resources	$8,938.0	$43,994.6
Proposed Spending	$8,932.5	$43,385.2
Projected Balance	$5.5	$559.4

Spending summary (Amounts in millions):

	General Fund			All Funds
	2008-09	2009-10	Change	2008-09	2009-10	Change
Agriculture	$31.7	$33.9	7.1%	$104.6	$83.5	-20.2%
Attorney General	31.6	31.9	1.2%	75.9	76.9	1.4%
Civil Rights	12.2	12.3	1.3%	14.2	14.4	1.1%
Com. Health	3,057.2	2,801.6	-8.4%	12.5	12,966.9	3.8%
Corrections	1,947.5	1,898.4	-2.5%	2,012.6	1,958.4	-2.7%
Education	26.2	26.4	0.8%	119.3	119.9	0.5%
DELEG	73.9	74.1	0.3%	1,392.1	1,442.7	3.6%
DEQ	43.7	33.1	-24.2%	361.3	341.3	-5.5%
Executive	5.3	5.3	0.0%	5.3	5.3	0.0%
Com. Colleges	299.4	299.4	0.0%	299.4	299.4	0.0%
Universities/Aid	1,645.6	1,545.6	-6.1%	1,759.1	1,719.4	-2.3%
HAL	8.6	0.0	-100%	10.4	0.0	-100%
Human Services	1,220.9	1,026.5	-15.9%	4,503.8	4,592.5	2.0%
DIT	0.0	0.0	0.0%	431.6	424.2	-1.7%
Judiciary	159.3	158.8	-0.3%	261.9	262.1	0.1%
Auditor General	12.5	12.5	-0.5%	15.9	15.8	-0.4%
Legislature	112.9	112.9	0.0%	114.5	114.5	0.0%
DMB	269.6	290.4	7.7%	488.2	497.9	2.0%
Civil Service	27.5	26.4	-4.1%	69.5	69.0	-0.7%
Military/Veterans	39.6	39.5	-0.4%	183.1	149.2	-18.5%
DNR	16.5	16.6	1.1%	298.0	307.4	3.2%
School Aid	40.8	40.8	0.0%	13,378.9	12,963.6	-3.1%
State	26.1	28.2	8.0%	214.2	213.6	-0.3%
State Police	284.9	278.5	-2.2%	530.2	538.5	1.6%
Transportation	0.0	0.0	0.0%	3,612.2	3,268.1	-9.5%
Treasury	75.5	68.9	-8.7%	1,496.6	1,512.6	1.1%
Debt Service	67.6	66.7	-1.4%	83.1	82.2	-1.1%
Strategic Fund	30.9	31.0	0.2%	151.9	163.7	7.8%
Employee Concessions		(27.5)			(50.0)
TOTALS	$9,567,5	$8,932,5	-6.6%	$44,475.9	$44,153.3	-0.7%

Department of Corrections- This Governor's proposed budget adds more members to the parole board to expedite the process of reviewing 12,000 prisoners who are serving past their earliest day of release. The governor released Executive Order 2009-5, which adds five more members to the panel. The bulk of the governor’s 1,500 proposed state employee layoffs will occur in Corrections, but exactly how many layoffs will occur is unknown as the department works out how many more facilities will be closed in 2010.

Governor Granholm is looking to close nearly 4,000 prisoner beds as she trimmed $120 million from the department’s budget. The budget also includes $12 million in savings from unidentified departmental efficiencies, as well as shifting funding in the budget to use the W.J. Maxey Training School campus to house about 275 male prisoners (60 juvenile offenders would stay at Maxey but in different facilities). Overall, the 2009-10 DOC budget totals $1.96 billion, $1.898 billion in general funds, representing a 2.7 percent decrease in overall spending compared to the current fiscal year. General fund revenue to the department would be reduced by 2.5 percent in comparison.

Governor Granholm is also recommending a $20 million supplemental in the current fiscal year to pay for re-entry and parole resources to facilitate the closing down buildings. Along those lines, the governor is also recommending adding $16.9 million to deploy and monitor 2,800 global positioning tether units (GPS) and $7.3 million extra for parole supervision in next year’s budget. The department’s Michigan Prisoner Re-entry Initiative would be increased by 40 percent under the governor’s budget, which recommends adding $23.4 million to bring spending on the program to $56.6 million.

Judiciary- Totals $262 million and represents a decrease in general funds by 0.3 percent (to total $158.8 million), while overall funding for this area would increase from current year levels by 0.1 percent. The budget continues spending for drug treatment courts of $5.2 million. Indigent legal assistance would receive $15 million under the governor’s proposed budget. The bulk of the appropriations goes to judges salaries, which total $95.5 million in the budget, followed by $84.3 million for local trial court operations and $19.2 million for the Court of Appeals. The governor has called for judicial salary cuts, along with pay reductions for other elected state officials, but any such cut wouldn’t take effect until 2011.

K-12- School Aid- proposed a $59 drop in the per-pupil grant for schools and drops a number of categoricals, particularly those that applied to only a few school districts. The budget calls for $12.96 billion for school spending, a 3.1 percent cut from the current fiscal year. The general fund part of that, $40.8 million, will hold steady from the current year. Among the highlights, the budget still includes $1.5 billion for special education and $850 million for at-risk students. Another $100 million is set to provide spots for 30,000 children in the Great Start Readiness Program and $6.8 million will give additional districts an opportunity for collaborative preschool programs. The governor also retained the $15 million for her 21^st Century Schools program to provide some districts with grants to create smaller high schools.

Department of Education- Will see some additional funding next year, but much of that comes from also absorbing the Library of Michigan from the soon-to-be-defunct Department of History, Arts and Libraries. The department would see a .5 percent increase overall, to $119.96 million. General fund would increase .8 percent to $26.39 million. Of that funding, school support services would be the largest chunk at $47.98 million ($3.55 million GF). The new libraries program, including the state library, would take $24.39 million ($18.83 million GF). Other lines with general fund include administrative support ($12.45 million gross, $3.57 million GF) and grants administration ($11.98 million gross, $436,100 GF). The Michigan Educational Assessment Program would receive $9.45 million, all from tobacco settlement funds.

Community Colleges and Higher Education- Governor Granholm continued her push for the state’s higher education institutions to hold the line on tuition and proposed no increase for community colleges and a 2.3 percent cut for state universities. Grants for students at private universities would be wrapped into a general needs-based financial aid package that officials said would mean a 75 percent cut in the aid to those schools. Community college spending was proposed at $299.36 million, all general fund and the same as the current year budget. The breakdown of operations, renaissance zone reimbursements and at-risk funding also remained the same. University spending was proposed at $1.71 billion, a 2.3 percent cut. And the general fund portion of $1.55 billion represents a 6.1 percent cut. But in the breakdown of that spending, the 15 universities would see 3 percent cuts in their operating funds. Financial aid would also see a hit, with all of the state’s need-based programs rolled into a new Michigan College Access Grant, which would have $89.76 million, an $18 million cut from the spending on the separate programs now. The Michigan Promise Grants would remain untouched and merit-based. The Tuition Incentive Program would see $6 million additional funding to $31.2 million. The proposal also combines the Agriculture Experiment Stations and the Cooperative Extension Program, both at Michigan State University, and reduces the funding for the new program.

Department of Community Health- Governor Granholm's budget is banking on $500 million from Congress in the form of an enhanced federal matching rate for Medicaid to balance out the Department of Community Health budget for next year. Overall, the DCH budget totals $12.97 billion, of which $2.8 billion is paid for with general funds. That represents a 3.8 percent increase in overall spending for the department, but an 8.4 percent cut in general fund appropriations. Overall, the department will see $106 million in cuts over the current year, including:

• $44 million saved from drug rebates through managed care organizations.
• $7.6 million in cuts to community mental health.
• $2 million in reductions from the Office of Services for the Aging.
• Eliminating the Office of Drug Control Policy.
• $6.9 million in savings by adding behavioral drugs to the preferred drug list.
• And closing the Mount Pleasant Center for Persons with Developmental Disabilities, for a savings of $5.7 million.

Other highlights of the governor’s proposed budget include:

• Expanding community-based services to senior citizens and the disabled. The state has been doing some of this already over the past seven years with a savings of $170 million. Enhancing this program and improving care options will save the state $6.2 million.
• 4,000 more children will have health care coverage at no added state cost under the Children’s Special Health Care Services Program.
• $6.9 billion will be spent on medical services, with another $2 billion spent for long-term care. Both programs will experience a 5 percent increase in spending from current year levels.
• Health Maintenance Organizations will receive $198 million more in provider payments.
• $73 million will be added for mental health services providers
• And $354 million more will be spent with more people becoming Medicaid recipients and using the system more often.

Revenue Sharing- Cities, villages, townships and some counties will see no reduction in their revenue sharing dollars from the state – a target for cuts in prior years. Holding revenue sharing at the same level as the current fiscal year means communities will split $1.1 billion with $661.2 million going toward constitutionally -required revenue sharing payments, with the remainder allocated statutorily. The governor’s budget also funds those counties coming back online with revenue sharing payments next fiscal year.

Department of Transportation- The only state budget not to receive general fund support, the Department of Transportation, gets $3.27 billion under the governor’s proposed executive budget. That represents a 9.5 percent reduction in revenues available for the department. The budget outline made no specific mention of where cuts to the department will be made. Of the department’s money, $2.5 billion go toward state and local road and bridge construction and maintenance.

Department of Human Services Budget- Elimination of payments to recipients of Supplemental Security Income, a cut that drew complaints from the chair of the House Appropriations Committee, was the largest cut proposed in the nearly $4.6 billion budget for the Department of Human Services. The total budget, including federal funds, is almost $90 million more than the current year’s total budget. But the general fund portion of the budget is cut by $194 million, or 15.9 percent, to a proposed $1.02 billion. The cut to Supplemental Security Income would be to those recipients living in independent living. The cut would equal $14 a month for each recipient. The total plan would save the state $29.8 million, cutting the state program nearly in half. The state would still pay is $32.5 million in the program.

Department of Environmental Quality- Governor Granholm proposed passing wetlands regulations back to the federal government, but her budget proposed Thursday would also mean funding hits to other environmental programs. The Department of Environmental Quality would see $341.3 million, a 5.5 percent cut from current year. But the $33.13 million general fund would be a 24.2 percent cut. Moving the wetlands program back to the federal government would save $2.1 million general fund and cut $400,000 in annual state fees. Much of the rest of the general fund cut comes from using bonding to match federal funds for the drinking water revolving fund program. Among the key items in the budget is $131.39 million ($741,200 GF) for local pollution cleanup and prevention grants, $60.7 million ($115,800 GF) for state pollution cleanup programs, $47.49 million ($10.28 million GF) for water quality management, $39.95 million ($8.52 million GF) for land management and $25.61 million ($6.68 million GF) for air quality programs.

Fee Increases Proposed for DEQ's Air Quality: DEQ is asking for a fee increase to run its air quality renewable operating permit. But the fee would only hit the few largest polluters and could potentially result in decreases for some of the smaller pollutant sources. The current fee has not been increased since 2001 and is not sufficient to meet federal standards for minimum program support. So loss of the program could cost businesses more and could potentially limit the number of new permits because of the federal agency’s requirement that any new emissions be offset by cutting twice as much somewhere else. Not funding the program could also mean loss of highway funds, he said. The department’s plan would increase the cap on the amount of pollution charged a fee to 8,000 tons per year from the current 2,000 tons. A 15 percent of the pollution sources in the state, mostly power plants and cement plants. The DEQ’s budget request also includes eliminating the sunset on storm water and National Pollutant Discharge Elimination System permits. Instead, the department is asking that the fees be indexed to inflation. The department is also asking to have the groundwater dispute resolution process repealed. The marina-operating permit is also on the chopping block for the coming year. The current permit is only $50 every two years.

Department of Natural Resources- Mackinac Island State Park would once again belong to the Department of Natural Resources. And visitors to other state parks would pay more to get in as part of the increase to the budget. The Governor's proposed budget totals $307.42 million, a 3.2 percent increase. General fund spending would be up 1.1 percent to $16.65 million. Some of that increase was $8.13 million ($4.78 million GF) for the Mackinac park, the Thunder Bay National Marine Sanctuary and Underwater Preserve, and other historical properties that are currently under the Department of History, Arts and Libraries. Another bit of the increase is a proposed $4 increase, to $28, in annual state park vehicle permits. As in most recent years, the vast majority of the department’s funding comes from its various trust funds: the Game and Fish Fund ($63.11 million, $2 million GF), the parks fund ($62.62 million), and the forest fund ($42.51 million, $42.9 million GF). Fees also largely cover the law enforcement program ($31.26 million, $1.55 million GF).

State Police- After receiving a $1 million boost in funding in the current fiscal year, the Governor is recommending the closure of the crime lab in Marquette. The move comes at a time when lawmakers have been informed of increasing backlogs at the crime labs since the state took over the Detroit Police Crime Lab’s forensic evidence analysis. The governor’s budget provides $36.7 million for the crime labs, including a $6.3 million bump in money to address the backlog, with money coming from the governor cutting state support for the horse racing industry. Overall, the State Police budget totals $538.5 million, $278.5 million paid for with general funds. The governor’s budget represents a 1.6 percent increase in overall spending compared to the current fiscal year, but includes a 2.2 percent decrease in general fund support for State Police. The budget also includes $36 million in grants to local units of government for officer training, local road patrols and auto theft prevention.

Military and Veterans Affairs- The department would receive a slight reduction of 0.4 percent in general fund support for the 2009-10 budget under the governor’s recommendation, but overall spending is down by 18.5 percent compared to the current fiscal year. Total funding is $149.2 million under the governor’s budget, of which $39.5 million is paid for with general funds. A large part of the budget goes toward maintaining the veterans’ homes in Grand Rapids and Marquette ($66.6 million). Another $4 million would go for support of Veteran Service Organizations. In terms of federal support, the executive budget includes $25 million for military training sites and armories and $15 million to fund special maintenance at military facilities. The budget also continues $5.3 million in spending through the Michigan Veteran’s Trust Fund along with $4.7 million for the Michigan Youth Challenge academy, neither of which receives general fund support.

History Arts and Library- Governor Granholm has proposed to eliminate the Department of History, Arts and Libraries would save $2 million in general fund dollars, as other departments would take on HAL’s core service areas. And along with the demise of the department, the governor is proposing elimination of grants for operations of arts and cultural organizations, a program that totaled $8 million in the current year. Most of HAL’s work will be transferred to the six departments under the governor’s proposal, although the Department of Education will get the largest share of those duties ($18 million worth in general funds).The DOE would take over the Library of Michigan, along with state aid to libraries, which comprises the most spending in HAL. Overall, $41.8 million ($30.7 million general fund) in HAL services will be taken on by other departments.

Other highlights of the budget include:

• Transferring the Michigan historical museum and related services, along with the Mackinac Island State Park Commission and the Thunder Bay National Marine Sanctuary and Underwater Preserve to the Department of Natural Resources.
• Transferring demographics and census data to the Department of Information Technology.
• Transferring the state records center and state archives to the Department of Management and Budget.
• Transferring the State Historic Preservation Office and archaeology programs to the Department of Energy, Labor and Economic Growth.

Department of Agriculture- Governor Granholm proposed to take money away from horse racing purses that comes from casino funds and move it to the state police crime labs. Horse racing programs would still see $7.77 million of the $83.5 million proposed for the Department of Agriculture. But that overall funding for the department is down 20.2 percent from current year. The $33.99 million general fund for the department is a 7.1 percent increase from current year. The proposal also includes a new dairy inspection fee that would offset some $700,000 in general fund for the program. While the fee would only cover a quarter of the total cost of the program, Ms. Granholm said in her budget document that other Midwest states charge a similar fee. Food safety programs continue to top the spending list for the department, with the pesticide and plant pest management program getting $15.3 million ($4.35 million GF), the laboratory getting $13.83 million ($2.98 million GF) and food and dairy getting $12.87 million ($8.66 million GF). Among other lines in the budget are $3.75 million for farmland preservation development rights and easement purchases and $2.5 million for worldwide promotion of Michigan agricultural products.

Attorney General- Would see a 1.4 percent increase in his budget to $76.97 million. The $31.98 million general fund would be a 1.2 percent increase. Most of that money goes to general operations, though $3 million ($802,600 GF) was set aside for child support enforcement and $2.03 million ($1.33 million GF) for the Prosecuting Attorneys Coordinating Council.

Civil Rights - Among the state’s smallest budgets, the Department of Civil Rights would receive $14.38 million, a 1.3 percent increase. The $12.32 million general fund would be a 1.1 percent increase.

Executive Office- Ms. Granholm again held her own spending stable at $5.32 million, all general fund.

Information Technology- Which receives all of its funding through grants from other departments for the services it provides, would see a 1.7 percent cut to $424.24 million. The largest source of its revenue, and spending, is health and human services at $229.4 million.

Auditor General - Despite some recent calls for additional audits and oversight, Granholm has recommended a .4 percent cut in spending for the Office of the Auditor General to $15.83 million. The $12.49 million general fund would be a .5 percent cut.

Legislature- Would also not see any change in funding, with total spending at $114.5 million ($112.99 million GF). Within that, the House would receive $47.54 million and the Senate $31.68 million.

Management and Budget- It oversees most state spending, would see its budget increase 1.7 percent to $566.99 million. General fund in the department would increase 6.6 percent to $316.78 million. The largest portion of that, $251.8 million ($250.3 million GF) covers the State Building Authority debt payments. The Civil Service Commission, until recently a separate department, has $69 million ($26.38 million GF), most of that required under the Constitution.

Department of Secretary of State's- Budget would be cut .3 percent to $213.64 million, though the general fund contribution would increase 8 percent to $28.2 million.

Treasury-would see a 1.6 percent increase to $1.758 billion, but general fund would be cut 4.3 percent to $166.6 million. Most of the department’s budget is revenue sharing (see above). The budget also includes the Strategic Fund ($163.69 million, $31 million GF) and student financial aid ($36 million, $1.53 million GF).

Department of Energy Labor and Economic Growth-Continuing additions to staff at the Unemployment Insurance Agency, which was hammered with calls from people seeking jobless benefits over the past two months, Granholm is including $18 million more for the agency to assist residents in her 2009-10 budget.  Overall, the department’s budget totals $1.4 billion ($74 million in general funds), which represents a 3.6 percent increase in all spending from the current fiscal year and a 0.3 percent bump in general fund appropriations. Granholm said the state would continue its commitment to the No Worker Left Behind program, as well as her new proposal for a Michigan Energy Corps that would put people to work weatherizing homes and schools. The energy corps would be paid for with federal, not state, funding. The budget includes $630 million for worker training and education, $123 million for energy programs (none of which is paid for with general funds) and $198 million through the Michigan State Housing Development Authority for low-income housing and community projects.

State Officers Compensation Commission (SOCC)- Michigan’s next governor, lieutenant governor, attorney general, secretary of state and Legislature taking office in 2011 will see their salaries cut by 10 percent. Supreme Court justices will not, be affected by the move. The commission approved this by a 5-1 vote.