The budget deal includes the following revenue increases, continuation budgets, government reforms and budget cuts:

Ø Income tax increase-House Bill 5194 will increase the income tax from 3.9 to 4.35 percent with a rollback beginning 2011. It is estimated to raise approximately $765 million.

Ø Service tax expansion- House Bill 5198 expands the sales tax to select services in Michigan. Michigan's 6 percent sales and use tax will now apply to services like consulting services, office administration, transit and ground passenger transport, and travel and reservations. Tickets for entertainment and sporting events will not be subject to a sales tax, nor will cable or satellite TV service, hair cuts, lawn mowing or health club memberships. It is estimated to raise approximately $613.8 million for the 07-08 fiscal year and $751.3 million for the 08-09 fiscal year. For a complete listing of the services that will be taxed under this bill, please visit http://www.michigan.gov/taxes/0,1607,7-238-43529-177121--,00.html

Ø Continuation Budgets- Senate Bills 772 and 773 extends the funding for the general fund and school aid budgets for the next 30 days. These bills authorize Michigan government functions to continue operating at current levels through the month of October. These bills passed the House unanimously and the Senate by a vote of 34-3 for SB 772 and 35-3 for SB 773.

Ø Insurance Pooling Reform- Senate Bill 418-421 allows public schools, colleges, universities and local municipalities to set up insurance pools for health care benefits. The conference report for the main bill of this package passed the Senate by a vote of 21-17 and the House by 56-53. For more information on the legislative votes on this bill package please see Senate record roll call vote # 378 at http://www.legislature.mi.gov/(S(mseymg45z1vyj555vcldcr45))/mileg.aspx?page=getobject&objectname=2007-SJ-09-30-099
and House record roll call vote # 442 at http://www.legislature.mi.gov/(S(mseymg45z1vyj555vcldcr45))/mileg.aspx?page=getobject&objectname=2007-HJ-09-30-101

Ø Graded Scale Premium Reform- Senate Bills 546 and 547 require future public school employees to adhere to a graded premium schedule for retiree health care coverage. School employees will receive 30 percent coverage after 10 years of employment and by their 25th year, they will reach the maximum of 90 percent coverage (i.e., 4% per yr.). Additionally, Senate Bill 547 increases the amount that school employees must contribute to their retiree health benefits (2%) to 6.4 percent. Senate bill 546 passed the House by a vote of 65-44 and the Senate by 23-15. Senate Bill 547 passed the House by a vote of 56-53 and the Senate by a vote of 21-17. For more information on this legislative vote please see House record roll call votes # 444 and # 445 at http://www.legislature.mi.gov/(S(y4zbtajajqhga355jgdgdw55))/mileg.aspx?page=getobject&objectname=2007-HJ-10-01-102
And Senate record roll call votes #399 and #400 at http://www.legislature.mi.gov/(S(y4zbtajajqhga355jgdgdw55))/mileg.aspx?page=getobject&objectname=2007-SJ-10-01-100

Ø State Employee Double Dipping Reform- House Bill 4800 prevents retired state employees who return to work with the state directly or indirectly from collecting their retirement benefits during their re-employment with the state. This bill passed the House by a vote of 97-12 and the Senate unanimously.

Ø Privatization of Prison Mental Health Services Reform- Senate 622 allows the Department of Corrections to contract with a third party for prisoner mental health services. This was amended to allow the Department of Community Health (the current service provider) to also provide these services. SEIU’s Public Service Accountability language in the boilerplate language in the House version of the Department of Correction’s budget and the continuation budget provides a necessary safeguard to prevent this privatization from occurring. This bill passed the House by a vote of 82-27 and the Senate by a vote of 22-16.

Ø Common School Calendar Reform-Senate Bill 549 requires school districts within the same intermediate school district to follow the same school calendar. This bill passed the House by a vote of 64-45 and the Senate unanimously.

Ø Prison Blues Reform- Senate Bill 632 allows the prison industries to manufacture and sell textiles (in particular, blue jeans) so long as it doesn’t compete with a business entity in Michigan that has a similar product. This bill passed the House by a vote of 101-8 and the Senate unanimously.

Ø Studies on Govt. Efficiency Reforms- Senate Bills 395-398 commissioned several studies on government reforms. The studies will look at government waste and red tape. These bills passed the Senate unanimously and the House by a vote of 108-1, except for SB 396, which passed the House by a vote of 104-5.

Ø Healthy Lifestyles for Medicaid Beneficiaries Reform-Senate Bill 1 requires Department of Community Health to offer incentives to encourage Medicaid recipients to adopt healthier lifestyles and the Dept. to adopt other cost containment measures. This bill passed the House by a vote of 107-2 and passed the Senate unanimously.

Ø $440 million in Cuts- In addition to the Legislature and the Governor agreeing on the level of revenue they will raise, they must also identify another $440 million in budget cuts.

Tentative Reduction Agreement Related to FY 2008 Budget Target Setting-

1) K-12 Education - cut the K-12 budget by $173.4 million or 1.5%; 2) Department of Human Services cut by $80 million or 6.2%; -includes a shift of foster children's health care to an HMO and a reduction in day care hours. 3) Department of Corrections cut by $55.6 million or 2.87%; -includes changes in the prison food services. 4) Department of Community Health cut by $52.5 million; -includes a 1.1 rate cut for Medicaid providers (includes hospitals, nursing homes, home care programs and physicians); and a citizenship requirement for all Medicaid patients (understand this is a back door way to reduce Medicaid payments to providers). 5) Higher Education and Community Colleges cut by $25.7 million or 1.5%; includes elimination of the funding increases for the state's community colleges and universities; 6) 2.5% cut across all other state departments-cut by $24.9 million; 7) Withdrawal from the Comprehensive Transportation Fund- $10 million; 8) Building Debt Service Line-Item cut by $7.68 million; 9) Justice Training Grant- cut by $450,000; 10) other miscellaneous reductions of $3.07 million.

Initiatives not funded by the tentative agreement include: $200 million to fund full day preschool for at risk four-year olds; $76 million for the Governor's "No worker left behind" initiative; $7 million for alternative energy infrastructure improvements; $10 million to attract tourism & business investment; and $15 million to expand the nursing education in Michigan (the nurse corp initiative).

Early Retirement Bill- Late August Senate moved an early retirement bill (SB 689). Under the bill, state employees whose age plus years of state service totaled at least 75 would be able to retire and it also increased the multiplier to 1.75 percent. It did not cover elected officials, corrections officers and State Police troopers. Current law allows state employees to retire with full benefits at age 60 with 10 years experience or at age 55 with 30 years experience. Those age 55 with at least 15 years can retire with a reduced benefit. The full benefit is the employee's highest annual pay (based on a three-year average) times years of service times 1.5 percent.

SCHIP Action on the Federal and State Level- President George W. Bush vetoed federal legislation to reauthorize the State Children's Health Insurance Program, which allowed states to use Medicaid funds to provide health coverage for children whose families were otherwise not eligible for low-income assistance. The governor said Michigan provides health care to 55,000 children under the children's health insurance program, but some 158,000 are uninsured. October 18th, the SCIP veto override failed to overturn President Bush’s veto of the SCHIP Bill by a vote of 273-156. As far as Michigan’s delegation, all the Democrats voted for it along with the following 3 Republicans Ehlers, Miller, and Upton. The following Republicans voted against it: Camp, Hoekstra, Knollenberg, McCotter, Rogers, Walberg and Tipton. A hidden issue buried in the bill remedies the problem of the UAW and GM VEBA to fund retiree healthcare being counted as “personal income” for FMAP purposes, thus, reducing our FMAP Medicaid money about $2.4 billion, Section 615.

In support of this SCHIP bill, the House passed House Resolution 201 and House Concurrent Resolution 51 urging Congress to override the President’s veto of the SCHIP program by a vote of 72-34 and 71-36. HCR passed the Senate with controversy as the Congressional override vote was taking place.

Civil Service Snafu- The Granholm administration brought a proposed rule before the Civil Service Commission at a special meeting September 28, would allow any department to lay off any employee for up to 20 days without the notice required under current contracts and temporary lay-off rules. Employees also would be prohibited from using leave or sick time to be paid for the lay-off. At the Civil Service Commission meeting, the Commission was split on the vote, rejecting the administration's proposal.. New appointees Mac Wardrop and Andrew Abood supported the administration's proposal, but Commission Chair Bryan Waldman and Sherry McMillan objected to the resolution allowing the new rule to be applied to existing contracts.

Nursing Home Settlement- Ciena Health Care Management Incorporated will reimburse the state and federal governments $1.25 million and will agree to state oversight of its facilities under a settlement. The settlement is the result of a billing fraud investigation conducted jointly by Attorney General Mike Cox, the Department of Community Health and the United States Attorney's Office for the Eastern District of Michigan. While the investigation focused on four of Ciena's 30 nursing homes, the settlement includes a corporate integrity agreement that will apply to all 30 facilities and will be subject to review by a state monitor. SEIU Healthcare Michigan represents employees at some of these facilities.

PAC Ruling-Ingham County Circuit Court Judge, Thomas Brown, overturned Secretary of State Terri Lyn Land’s ruling, holding that state and local government employees can have contributions to their union PAC deducted from their paychecks so long as the PAC covers the cost of those deductions.

Jail Overcrowding- House Bill 4234 and House Bill 4725-passed the House and was reported out of the Senate judiciary committee. This bill package authorizes counties to develop jail population management plans to delegate reduced sentences with the consent of sheriffs, prosecutors, chief circuit judges and the chief or designated district judges, or alternatively empowering judges and county officials to reduce sentences or take other measures when jails reach 95 percent of capacity for at least seven straight days.

Estate Recovery- Michigan became the last state to adopt some form of estate recovery program for Medicaid under SB 374 and SB 204, these bills permit the state to assess the estate of an individual who had been receiving Medicaid benefits for partial reimbursement of those costs. The estate's first obligation would be for such things as funeral costs, with the state taking a lower priority. The Department of Community Health would establish details of the program. Elements would include placing liens on assets of Medicaid recipients that would be subject to recovery by the state, tracking both assets of and services to those persons, and outlining the actions needed to collect amounts owed to the state.

Bathroom Access- The House did approve HB 5046 (72-35), which allows people with bowel diseases and women who are pregnant to use private restrooms at businesses if they have medical proof of their condition. It also sets up a misdemeanor for people who falsely claim to have an illness.

Senate Foster Care- SB 672, SB 668, SB 669, SB 670 and SB 671 will allow creation of a permanent guardian status for adults who wish to care for and raise a child, but not adopt the child. The new provision was created after more than a year of work looking at how to help ensure that more children are raised in permanent settings rather than leaving them in foster care. This has passed the Senate.

Carlyle Group-Buyout- The State Long term care ombudsman in a press conference raised concerns about the pending sale of the HCR Manor in Michigan to Carlyle Group, a private equity firm. "The further removed we get from the ownership the more difficult that becomes to resolve problems and frankly the less direct responsibility they tend to take in resolving individual problems." Ms. Slocum did not say the state had any particular concerns about the pending transaction, but joined health care worker unions in urging the prospective buyers to be sure the deal is structured to ensure quality care at the facilities. Carlyle Group is headquartered in Washington, D.C. HCR Manor Care is headquartered in Ohio. Also participating in this press conference was SEIU Healthcare Michigan, which represents nursing home workers and other healthcare fields, joined its counterparts in other states where Carlyle is operating or looking to purchase facilities urging that it pledge to maintain or improve care levels in the facilities. The SEIU has launched a website, www.carlylefixmanorcarenow.org, and a series of radio ads urging the public to pressure Carlyle into pledging quality care at its new facilities.

Predatory Lending-Jesse Jackson has appeared across the state on the issue of predatory lending and foreclosures and the need for restructuring. The House Banking and Financial Services Committee is holding hearings on predatory lending practices. 24 bills have been introduced on this subject (HB 5287, HB 5288, HB 5289, HB 5290, HB 5291, HB 5292, HB 5293, HB 5294, HB 5295, HB 5296, HB 5297, HB 5298, HB 5299, HB 5300, HB 5301, HB 5302, HB 5303, HB 5304, HB 5305, HB 5306, HB 5307, HB 5308, HB 5309, HB 5310) Some of those components of these bills include:
· A requirement that a lender verify the consumer's ability to pay for the loan product, both before and after the rate adjusts;
· Remedies for families who are currently in adjustable rate mortgages or for families who were steered into loans they couldn't afford or who were otherwise defrauded;
· A requirement that closing paperwork be made available to the homeowner at least 72-hours before closing;
· A requirement that lenders send homeowners a notice of free available legal help during the closing and/or foreclosure process;
· A requirement that homeowners get borrower counseling before entering into a high risk loan; and
· A requirement that the appraisal value reflects the actual value of the property.

Individual Market Reform Insurance Passes Out of Committee- (HB 5282, HB 5283, HB 5284 and HB 5285, were all approved by 16-1 by the House Insurance Committee. This legislation is similar to the small market reform enacted a couple of years ago. Creating rate bands, though narrower than with the small group reforms, to control cost increases, and limit the ability of insurers to "cherry-pick" the healthiest persons while leaving higher cost individuals to the Blues, which would retain its tax-free status and status as insurer of last resort. Opponents raised several concerns in addition to how the Blues retain tax-exempt status while gaining equal footing in setting rates and in other matters dealing with individual policies, among them:
· A provision for a loss ratio of 70 percent, which the Blues says means that any excess profits will have to be given back.
· Whether a high-risk pool run by the Blues and supported with assessments on it and other health insurers should be run by the state or put out for competitive bid.
· Whether a standard benefit package should be established so all carriers have the same basis for setting rates. -Changes in rate protesting procedures.

· The impact on the small group market.

State Fleet- HB 5006 amends the Management and Budget Act and Judiciary Act to allow the Department of Management and Budget (DMB) to issue directives on the purchase, lease, maintenance, operation, assignment, and use of state owned vehicles for official business for state agencies, including for the legislative and judicial branches. (Departments of Transportation and Natural Resources have a separate section dealing with the use of state vehicles because they are not under DMB policies with respect vehicles). HB 5005 deals with creating directives about the judiciary’s use of vehicles.

Elder Abuse Resolution Kicked out of Committee HR 207- a resolution memorializing the United States Congress to enact federal legislation to prevent elder abuse.

Early Voting Taken Up By the Elections and Ethics Committee- HB 4508 provides a 7-day early voting period upon the signing of an affidavit and showing of photographic id. House Bill 4090 sets up a 14-day early voting period, but requires the clerk to have at access during the early voting period a lot of stuff like poll inspectors, challengers, book, list and security and access to voting machines. The Committee will be putting together a workgroup to iron out a good bill on this issue.

Police and Firefighter Defined Contribution Light- HBs 5169 & 5170 amends the police officer (including the state police) and firefighters pension acts requiring their board to do a cost analysis of their current pension system by January 2, 2008. And that the pension plan for employees hired after July 1, 2008 cannot cost more than a defined contribution system. These bills have been referred out of the Government Operations Committee to the House Retiree Healthcare Reform Committee, Rep. Meadows is the Chair.

Retiree Healthcare Prefunding Vehicles- HB 4600 & HB 4601- HB 4600 amends the State Employees Retirement Act by adding Section 49a to require the system's retirement board to create a state employee health care fund for the purpose of accumulating funds to provide for the funding of heath care benefits to retirants, former qualified participants, and other beneficiaries under the act. Under the bill, the fund could receive money from any source including contributions from members and qualified participants. The bill specifies that the legislature intends that any contributions from qualified participants be pretax contributions for tax purposes. House Bill 4601 amends the Public School Employees Retirement Act of 1979 by adding Section 91a to require the system's retirement board to establish a public school employee health care fund to accumulate money to provide for the funding of hospital, medical-surgical, and sick benefits for retirants and retirement allowance beneficiaries who elect coverage in the board-authorized plan. Each bill provides for fiduciary responsibilities, exempt status and legislative reporting. These bills have also been referred out of the Government Operations Committee to the Retiree Healthcare Reform Committee Chaired by Rep. Meadows.

Pontiac Hospital Shuffle- St. Joseph Mercy Oakland (SJMO) a member of trinity care and North Oakland Medical Centers (NOMC) have entered an affiliation agreement. Under the terms of their agreement, SJMO and NOMC will develop and implement collaborative initiatives to reduce duplicative services and MacLaren will be moving to Clarkston.

Policy Summit September- Put on by the Michigan Prospect and Michigan voice brought more than 400 people together on a Saturday to discuss education, healthcare and clean energy. This event featured guest speaker Donna Brazile, a political strategist who worked for Al Gore.

Riding without a Helmet- Under the bill a person who is at least 21 and has been riding a motorcycle for at least two years or passed a motorcycle safety course, has at least $20,000 security for medical expenses and pays a $100 fee (or $200 for a three-year permit), could get a permit to ride without a helmet. Passengers riding with a cyclist permitted not to wear a helmet. The bill also exempts motorcyclists from other states from wearing a helmet. The House had designated $5 million annually to the Michigan Commission on Law Enforcement Standards for peace officer training. The Senate committee put $1 million toward secondary road patrols for sheriff departments and the remainder to the Traffic law Enforcement and Safety Fund, which helps to pay for Department of State Police troopers. This has passed the House and Senate, the Guv vetoed it last session.

Appointments and Staff Changes-
Staff Shakeups-
Mary Lannoye, Governor Jennifer Granholm's chief of staff is leaving the end of October.
Minority Floor Leader, Rep Ward resigned saying he lost the support of his caucus over his vote for a tax increase as part of the 2007-08 budget agreement. Later that week House Republicans replaced him with Rep. Hildenbrand.
Court of Appeals Judge Appointments- Jennifer Granholm appointed Elizabeth Gleicher and Jane Beckering to the Court of Appeals. Ms. Gleicher was named to fill an opening in the second district of the court and succeeds Jessica Cooper. Ms. Beckering succeeds Janet Neff, in the third district of the court. Ms. Neff was recently confirmed to the U.S. District Court. Both were appointed to terms expiring January 1, 2009, meaning they will have to run for re-election in the 2008 election.
Steve Transeth Appointed to PSC- Senate unanimously confirmed the appointment of Steve Transeth to the PSC 37-0 vote.
The Senate unanimously confirmed Isiogu Appointment to PSC and as Chair of the PSC.

Court Decisions-
School Criminal Background Check Package-Court of Appeals ruled that the state requiring that schools get background checks on employees without increasing funding, was not an unfunded mandate and didn't violate the Headlee Amendment.
FOIA Case-University of Michigan is appealing a Court of Appeals decision (Michigan Federation of Teachers v. University of Michigan, SC docket No. 133819) that held, unless university employees can show cause why they should be protected, their home addresses and telephone numbers were public information and should be released.

Political Issues-
State Senator Schauer declared he is Running Against Walberg for the U.S. House in the 7th district.
Berryman Drops out of 7th CD race to defeat U.S. Rep. Tim Walberg in the 2008 election.

Presidential Primary- Michigan would be the first big state in the nation to hold a presidential primary in 2008 setting the date for January 15. This passed the Senate unanimously SB 624 and the House by a vote of 67-34 and it was signed into law, PA 52.
Presidential Dems. Pull out of MI Primary- Four Democratic presidential candidates, U.S. Sen. Barack Obama , U.S. Sen. John Edwards Joe Biden and Bill Richardson pulled their names out of the January 15 primary. U.S. Sen. Hillary Clinton, U.S. Sen. Chris Dodd and U.S. Rep. Dennis Kucinich and former U.S. Sen. Mike Gravel did not withdraw their names from the primary. The candidates are saying that they would not campaign in Michigan out of deference to the Iowa caucus and the New Hampshire primary. The Democratic National Committee told Michigan and Florida (which moved its primary to January 29) that their delegates would not be seated if they violated the agreement on the presidential delegate selection calendar. Democratic officials are debating whether to continue with the January 15 primary or switch to a caucus on February 9.
Repubilcan DelegatesThreatened by Early Primary-Michigan Republicans could see the number of delegates to the national convention in 2008 in Minneapolis cut in half under a decision announced by national GOP Chair Robert Duncan. Michigan is one of five states that could see its delegate total cut in half because it has moved its primary up before February 5, the date the party has set for the beginning of the delegate selection process. Michigan's 60 allocated delegates will be cut in half to 30 delegates. Mr. Anuzis said in his statement that Michigan Republicans are still committed to the January 15 date.

Recall 5- Dems and 5-Republicans on the firing line-The ten legislators slated to have recall petitions filed against them because of their votes on taxes: Rep. Steve Bieda, House Speaker Andy Dillon, Rep. Marc Corriveau and Rep. Ed Gaffney , Rep. Robert Dean , Sen. Gerald VanWoerkom, and Rep. Mary Valentine, Sen. Valde Garcia (R-Howell) and House Minority Floor Leader Chris Ward and Sen. Wayne Kuipers.

Budgets-
Department of Agriculture House Passed Version (HB 4352)- is $107.8 million of which $30 million comes from the general fund. Overall the budget recommendation is 2.2 percent, or $2.4 million, decrease in spending compared to the 2006-2007 fiscal year. However, all of the decrease comes from less federal and restricted revenue - the general fund portion of the budget grows by 6.1 percent, or $1.7 million. These programs would be increased, are the food and dairy ($600,000), bovine tuberculosis ($200,000) and Right to Farm ($150,000). It incorporated $963,200 in appropriations for building and track improvements at county and state fairs. The money had been left out of the executive budget. Funding was also preserved in the budget for Great Lakes Downs in case race dates for that track are added for 2008. And money for the inspector program was amended to say that none of it would lapse into the general fund. The budget bill includes $916,800 in general funds for local conservation districts, which the executive budget had proposed deletion of those grants. The budget also adds $250,000 in possible federal funding for migrant housing and a $250,000 increase in general fund spending for the Buy Michigan program. The governor had recommended a $500,000 increase in that program. The House subcommittee version agrees with the executive proposals for horse race purses and supplementals, which reflect an anticipated reduction in revenues for the Agriculture Equine Industry Development Fund.

AG Fee Bills Passed- HB 4849, HB 4860, HB 4862, HB 4863 and HB 4864, eliminates sunsets for various regulatory fees where the September 30 deadline would have meant the fees were reduced, not eliminated. The programs affected are pesticide, pet shops, insect pest and plant diseases, horse riding stables and livestock operations. The legislative package means a continuation of $500,000 fees for the department. All of bills were amended to include a sunset for 2012.

Community Colleges- (HB 4360) is $333.8 million, all of which is paid for with general fund monies. The appropriation represents a $44 million, 15.2 percent, hike above current year spending for the state's 28 community colleges. However, $25.8 million of that increase is the reimbursement for the delayed payments to the colleges made in the current fiscal year. The governor had recommended a $323.1 million budget. The budget includes a 2.5 percent increase to the colleges at a cost of $7.1 million. The funds will be dispersed through a formula decided on by a task force (Gast-Mathieu data), which is different than the 2.5 percent across-the-board increase the governor had recommended. However, with parity funding and other adjustments included, the range of increases above current year appropriations is 3.26 percent (Southwestern) to 9.55 percent (Gogebic). Also included in operational funding is $505,600 for Alpena, Bay de Noc and Gogebic because those colleges have tax bases less than $1.4 billion and assess at least 2.5 mills. Wayne County Community College also appropriates a $225,000 that completes the restoration of the $450,000 cut to the school made in the fiscal year 2003-2004. The budget also contains $7 million for nursing program grants, with up to half of that money given to the colleges based on the number of new nursing students in the 2007-2008 academic year compared to the 2006-2007 academic year. Each new student would equate to a $2,000 grant to the college, while the remaining $3.5 million would be appropriated based on A.D.N. and R.N. nursing awards in fiscal year 2005-2006.

Department of Education (HB 4346) totals $97.8 million, $8.2 million of which comes from general fund revenues. That corresponds to a $7.2 million, 8 percent, increase in spending ($1.6 million of the increase is in general funds). However, much of the overall rise ($4.2 million) in the appropriation comes from the transfer of career and technical education operations from the Department of Labor and Economic Development. The budget does include $1.6 million from increased teacher certification fees and new teacher college review fees. Of that, $904,400 would go toward the upgrade and conversion of the teacher licensing database, another $200,000 goes toward Central Michigan and Wayne State universities' alternative teacher certification programs, which the governor had deleted in her budget. The bill also appropriates $150,000, all in general funds, for a school employee salary and benefit study to see how those compare to the private sector and other states. Another $300,000 study, all in general funds, would look at the effect of school consolidation - from services to districts themselves. The budget was amended to have the department also look at how traditional teacher and alternative teacher certification programs compare. Early childhood education would also receive $400,000 (all general fund) and four employees within the department for the program. There is a $100 placeholder for the new 21st Century Learning Environment Initiative.

Higher Education (HB 4350 & 4351)- Michigan State University, the University of Michigan and Wayne State University are funded with HB 4351 and the remaining 12 public institutions receive appropriations through HB 4350. The range of appropriation increases under the budget range from 4.69 percent (Western) to 11.07 percent (Lake Superior State). Overall, the bills total $1.6 billion, $1.5 million of which is paid for with general funds. The budget is $76.8 million, or 5.25 percent, above current year appropriations. The $139 million payment that was delayed to universities until October is included in the appropriations. Universities would receive a 2.5 percent across the board rise in funding. The budget also outlines an additional 2.5 percent increase in appropriations that would be divided up by weighing the number of Pell Grants students receive, federal research expenditures and degree completions in the fields of math, science and engineering. Because they are in two bills, MSU, U-M and WSU would split a 2.5 percent increase and the other 12 schools would split their own 2.5 percent pot. The House included $2.9 million in general fund spending to continue the Tuition Grant Program, which the executive had recommended cutting. Cooperative Extension would be funded at the same level it is this fiscal year, while Agricultural Experiment Station would see a 2.5 percent ($845,700 general funds) increase. The bills also contain language requiring the all 15 schools admit the Michigan students who graduate at the top 10 percent of their class and who meet all other criteria outlined by the school for admission.

The School Aid Budget (HB 4359) totals $13.3 billion, of which only $35 million is paid for with general funds. The budget spends $301.3 million, or 2.3 percent, more than the current fiscal year. However, with estimated reductions in school aid revenue, the budget is $495 million in deficit. The School Aid budget covers the 552 local school districts, 229 public school academies and 57 intermediate school districts. The governor had recommended a $178 per-pupil increase and a $23 equity payment that is rolled up into the base foundation for eligible districts. The House version contains a $100 per pupil increase. Eligible schools would still receive the $23 equity payment, but the House also included another equity payment up to $100 per pupil for districts with a foundation of $7,669 or less per student. The House budget also incorporates $16 million additional spending for declining enrollment districts, bringing the total available $36 million. $20 million is designated in transportation grants to districts ($15 million goes to districts with total square miles greater than 156 and the rest goes to districts with fewer than 5 pupils per square mile. The money represents a $98 per pupil grant. The House and executive budget delete $20 million in funding for middle school math grants, but the House does not include the $10 million recommended by the governor for consolidation of business, administrative and instructional services with intermediate school districts. The budget includes no raise in appropriations for ISD general operational funding. The budget also incorporates a variety of school readiness and early childhood grants. And the budget also includes boilerplate language specifying that it is the intent of the Legislature to have all districts providing full-day preschool by 2011-2012.

Human Services (DHS) Senate Bill 232 one of the more controversial provisions in the 2007-08 budget to privatize Michigan's foster care and juvenile justice systems. The budget totals $4.516 billion, $1.264 billion in general funds though the Senate also directed the department to cut $11.9 million from the general fund.

General Government Senate Bill 229-Approved on a 21-7 vote, and in sending the measure to the House the Senate slapped on a requirement that all Secretary of State branch offices open on August 1 of this year must stay open during the fiscal year. The budget - which finances the Executive Office, the Legislature, the Department of Attorney General, the Department of State and the departments of Civil Rights, Management and Budget and Treasury - totals $2.89 billion, most of that in revenue sharing funds. The budget is $625 million in general funds and the Senate adopted an amendment requiring the departments enact a total of $4.3 million in general fund cuts. The budget also cuts $5 million from the Lottery advertising budget and puts that money instead into revenue sharing.

State Police Senate Bill 238- Despite protestations that the State Police would not be subject to any cuts, the Senate did adopt a requirement that the department find $7.2 million in cuts. That actually would mean the department would see a roughly $2 million cut from the current year's appropriation. The budget is about $5.5 million more than Ms. Granholm proposed. The budget totals $566.4 million, with $273.7 million in general funds before the $7.9 million in cuts is considered. The budget includes funding for more than 1,141 troopers but does not envision a trooper school. It does include $1,000 placeholder items to search funding to provide protection for VIPs and to provide community services.

Department of Labor and Economic Growth Senate Bill 234- Totals $1.3 billion, with just $47 million in general funds. The majority of the budget is funded through federal monies. The bill does set up establishment of the No Worker Left Behind program that Ms. Granholm has proposed that would provide up to two years of free tuition at a community college for laid off workers. But it eliminates the $40 million in general fund she had proposed, leaving only $37 million in federal funds. The bill also reduces to a placeholder the Michigan Nursing Corps.

Department of Agriculture Senate Bill 222- With the state of horse racing in Michigan almost reduced to claims stake status, much of the talk on the Department of Agriculture budget dealt with peeling off some money from equine development to finance the Detroit police. Mr. Thomas attempted to draw $2 million out of the state's equine development fund to finance crime stopping and investigative activities in Detroit, arguing that if horse racing in Michigan is virtually dead then some of the funding should be used to finance ongoing activities. The budget totals $109.6 million, with about $21 million in general fund. The budget calls for the department to implement cuts totaling $539,0000. The budget also calls for the state to spend about 20 percent of its specialty crop block grant on farm markets as part of agricultural tourism. And the budget includes a placeholder in hopes of raising $400,000 that could leverage as much as $70 million in federal monies.

Strategic Fund Senate Bill 239- Totals $166 million, nearly twice the size of the current year's budget. The general fund portion totals $27.3 million. The budget was expanded so much because $75 million was added from the tobacco settlement fund. Even so, the budget is still $15 million less than Ms. Granholm's proposal. And it requires $177,500 in general fund savings. The budget deploys that additional $75 million into the 21st Century Jobs Fund. The budget also requires reports to the Legislature on the effect of administrative rules that could change the intent of legislation. And where Ms. Granholm called for $7 million to create an alternative energy program, the budget adds $100 placeholder.

Judiciary Senate Bill 233-The budget was exempted from requirements that the judiciary enact additional general fund cuts, though amendments to call for $749,000 in cuts had initially been prepared. The budget totals $260 million with $159 million in general funds. The budget also includes a provision calling on the State Court Administrator to look at systems that would allow for better court management of people with mental illnesses. The budget is also a total of $2.5 million less than Ms. Granholm's proposal.

Military Affairs Senate Bill 235- Carries a number of placeholders to deal with such matters as maintenance to the state's armories and for the purchase of unmanned aircraft that could be used to protect Michigan Nation Guard troops in Iraq from improvised explosive devices. The budget totals $127.8 million, with $40 million in general funds. The Senate called for the department to enact $812,000 in cuts.

History, Arts, & Libraries Senate Bill 231- An effort to add $4 million to restore some of the cuts to arts grants failed. The budget totals $43.8 million, $33.6 million in general funds, and is nearly $3.6 million less than Ms. Granholm's proposal. The budget also calls for the department to cut spending by $298,000. The $4 million in additional funding for arts grants would have restored that line to Ms. Granholm's proposal, but the chamber shot the amendment down. The Senate also required that the maximum amount any one cultural organization can get in an arts grant is 15 percent of the total. Ms. Granholm had proposed the maximum at 16 percent.

Senate Republicans for zeroed out the House passed budget bills before sending them to conference committees. The bills were for the Department of Education (HB 4346), community colleges (HB 4360), Corrections (HB 4346), Community Health (HB 4344), higher education (HB 4350), School aid (HB 4359), Natural Resources (HB 4354), and Environmental Quality (HB 4358).
The House also zeroed out the Senate's original budget bills, except for boilerplate language, (SB 222, SB 231, SB 233, SB 235, SB 234, SB 240, SB 238 and SB 232). The only bills to have Senate changes non-concurred in on a party-line vote were those for the Departments of Labor and Economic Growth and Transportation.