Governor, Legislators Reach Deal on State Budget

The governor and legislative leaders announced a tentative deal Thursday that would lessen planned cuts to schools and put aside money in the state's rainy day funds.

Gov. Rick Snyder, Senate Majority Leader Randy Richardville and House Speaker Jase Bolger made the announcement in Lansing.

State Rep. Kurt Heise, R-Plymouth, hailed the new figures as "historic" in a note on his Facebook page. Heise voted against the proposed budget, as it moved through the state House, and earned the praise of the Board of Education and administration at its last general board meeting on May 10.

On Friday morning, in a meeting with constituents, Heise said that getting the budget completed by June 1 was "phenomenal" and helps area school districts.

"The budget has always been done in recent years in the September timeframe," he said. "It's a nightmare for local school districts."

Snyder's proposed education funding cuts led to rallies on the state Capitol steps, town hall-style meetings led by Democratic lawmakers and letter-writing campaigns.

Thursday's announcement follows Monday's news that the state received more than $400 million extra in payments than anticipated.

The terms of the new deal struck between the state legislature and governor include:

• A per-pupil cut that would be less than $100. The original cut proposed by Snyder was to be $300 per student. Last year, the state cut $170 from per pupil funding.
• $310 million in funding for K-12 schools more than was originally proposed. $150 million of that would be distributed on a per-pupil basis to districts if it adopts what officials call “best financial practices," such as outsourcing non-instructional resources and finding ways to reduce costs associated with employee benefits.The schools would also get a one-time $160 million to help defray retirement system costs.
• $30 million in additional funding for local communities, half of which goes to cities, villages and townships as part of the Economic Vitality Incentive grants, and the other half going for county revenue sharing.
• $50 million for the Michigan Strategic Fund for economic development activities, including brownfield redevelopment and historic preservation incentives. 
• A $25 million cap on incentives for the film industry.
• Money for the the state's rainy day funds, including $255 million for the  Budget Stabilization Fund and $133 million to a School Aid Fund reserve account.

The governor had asked for a deal by May 31.

"We will have a timely, balanced budget in place so that our municipal and school partners can accurately plan for the coming year, avoiding the chaos that too often has been foisted upon them due to Lansing's inaction," Snyder said in a statement.