Michigan budget must focus on dual crises

The governor’s proposed budget does focus on the needs of Flint and Detroit Public Schools. That may leave other issues in the back seat for a while, but the crises in Flint and DPS have by necessity made this an emergency budget.

Gov. Rick Snyder’s 2017 budget proposal focuses heavily on two immediate challenges facing Michigan — the Flint water crisis and the looming insolvency of Detroit Public Schools. But if approved it would also invest heavily in the state’s future.

For Flint, the governor is offering a $195 million plan that is rightly targeted on the long-term needs of the residents, particularly the children, affected by lead in the city’s drinking water.

Much of the money will go toward ongoing health and educational needs of 9,000 Flint children under age 6 who were exposed to excessive levels of lead. They will need better nutrition, enhanced educational programs and counseling to combat the effects of lead in their bodies.

As the governor noted in his budget announcement, this is not a one-year obligation. These children will need assistance for years. And since many come from poor families, the state must assure them the resources will be there when they need them.

Some of the money is dedicated to infrastructure fixes. But Flint and the state are awaiting mapping and other studies to determine what is needed. Snyder is counting on help from the federal government, and should get it given the Environmental Protection Agency played a role in the governmental bungling that delayed public warnings about the lead.

The state also has the option of floating bonds for the Flint work, once a solution is agreed upon.
Taxpayers should get used to seeing special appropriations for Flint in the budget. As noted, this is not a short-term problem. Flint will need help for a long time.

For that reason, the governor and Legislature also should consider setting up a separate rainy day fund for Flint to guarantee the money will be there even in the event of future economic downturns that impact the state budget.
Detroit Public Schools will also be a long-term draw on the budget.

Snyder is requesting $72 million in the 2017 budget to start paying down the district’s operational debt over 10 years and create a new school district that would focus on educating students.

The money would come from the Tobacco Settlement Fund, rather than the School Aid Fund, sparing other districts from sacrificing on behalf of Detroit. That should help ease lawmaker concerns.

Over a decade, the governor wants more than $700 million to pay down the $515 million in current debt and cover the $250 million needed to start the new district.

DPS is expected to run out of money this spring. Yet lawmakers are still debating the debt relief plan. So Snyder is requesting a $50 million supplemental appropriation in this year’s budget to avoid insolvency.

The debt relief funds should free up $1,000 per student to go into the classroom.

The governor isn’t offering any immediate funds to handle the estimated $50 million in building repairs. That, too, may demand a separate bond issue.

The brightest spot in the budget request is the proposal for an additional $61.2 million for higher education, which restores funding to 2011 levels. The increase to the $1.3 billion in university appropriations will include a 4.8 percent cap on tuition hikes to qualify for incentive funding. That’s a boon to the universities, and relief for students.

More investment in public universities is strongly supported by business leaders in the state, and is critical to Michigan’s competitiveness. This is a funding trend Snyder should continue.

Overall, the $55 billion budget proposal should be considered a crisis spending plan, given the heavy spending requirements of Flint and DPS. Some other priorities will have to take a back seat for a while. Fortunately, higher education isn’t one of them.

But Flint and DPS are the two top challenges in Michigan, and they won’t be met on the cheap.
— THE DETROIT NEWS