Michigan lawmakers dole out $1B in wee hours, lame-duck spending spree

Feb. 1, 2019: Gov. Whitmer rips Republican pork deals, but won’t block them
Dec. 21: That's a wrap! What bills passed, died in Michigan lame duck for the ages
Related: See what Michigan lame-duck bills we're tracking

The Michigan Legislature capped its lame duck session with a financial flourish, approving nearly $1.3 billion in extra funding for toxic cleanups, crumbling roads, school safety and lots of cash for pet projects in lawmakers’ home districts.

And in a surprise, the GOP-lead House and Senate rolled the dice on a deal to legalize internet gambling, sending Gov. Rick Snyder separate legislation they hope will generate a windfall for Michigan.

Related: Michigan lawmakers spread millions in pork. Did your town get a cut?

The wheeling and dealing started Thursday and stretched into Friday morning as bleary-eyed lawmakers wrapped up negotiations on a supplemental budget deal. At least $379 million of that spending will come from the state's general fund; the rest are federal dollars.

The consequential budget bills — one each for the general fund and the School Aid Fund — were not introduced until about 3 a.m. Friday

Hours before adjourning for the year, the House and Senate voted to send the bills to Snyder, a Republican whose last day in office is Dec. 31.

Among the big-ticket items:

• About $20 million for the state’s efforts to combat PFAS, toxic chemicals that have leached into drinking water across the state. That includes addressing drinking water infrastructure, mapping contaminated sites and conducting public health investigations.
• $25 million for schools to implement security measures.
• $20 million to expand broadband access statewide.
• $43 million to pay down unfunded liabilities in the state pension system for military retirees, and unfunded liabilities in other post-employment benefits for state judicial retirees.
• $52 million for a state match to support a federal project to replace a lock at the Soo Locks.
• $100 million for the state’s rainy-day fund. That deposit is expected to bring the state’s reserves balance to more than $1.1 billion.

The bills also include about $115.5 million in “enhancement grants” — earmarked spending for individual districts. They’re better known as pork.

In all, more than 70 projects got funding, spreading money throughout the state, from $1 million apiece for work on the Escanaba River and Beaver Island Ferry in the Upper Peninsula to $4 million for the $4 million for the Muskegon Industrial Park and $1 million for the John Ball Zoo in Grand Rapids.

Lawmakers also approved more than $79 million for the state’s public schools, including $30 million from the School Aid Fund and close to $28 million from the general fund. That includes $31.3 million for mental health support services and $18 million in funding to support at-risk students.

Aside from unspent funds or higher-than-anticipated tax collections, the funding in Friday’s budget bill also includes an estimate $203 million in new online sales tax collections resulting from a U.S. Supreme Court decision this past summer and extra dollars from a state health care tax, according to the state budget office.

Voting on the larger budget bills followed votes on legislation late Thursday and early Friday to set aside extra money for roads and toxic site cleanups in a separate bill that angered Democrats — and some Republicans — because it diverted some income tax money intended for schools.

That bill, which started in the House as a way to avoid taxing compensation paid to people who were convicted of crimes they didn’t commit, was overhauled in the Senate late Thursday to send money to environment projects and roads.

Senate Republicans said they would offset the lost revenue from schools with a slice of the new online sales tax windfall.

The House amended the bill to include a provision backers said would project the school fund: The diversion would not happen if per-student funding fellow below last year’s levels.

Yet that didn’t satisfy Democratic and some Republican lawmakers and school advocates, who contend that Michigan’s public schools need more funding, not less.

Nor were education advocates happy.

“The decision to divert money away from students to potholes is short-sighted and undermines Michigan’s future,” Amber Arellano, executive director of The Education Trust-Midwest, said in a statement early Friday.

“The state’s decades-long disinvestment in students, teachers and public schools is on display through declining academic achievement, wide gaps in the opportunities for low-income students and students of color compared to their higher-income peers, and crumbling school buildings.”

But the maneuver was a gain for one of Snyder’s huge priorities: cleaning up thousands of toxic sites and boosting recycling. The budget deal will create a $69 million “Renew Michigan’ program to tackle that challenge.

The push comes as the state’s chief funding source for toxic cleanups — a $675 million bond voters approved 20 years ago — has run dry.

Under the deal, $45 million each year will flow to toxic cleanups, and $24 million would go to recycling and landfill oversight, which Snyder hopes will boost Michigan’s recycling rate.

The lawmakers also sent Snyder bills to allow internet gambling in Michigan, following a U.S. Supreme Court ruling that paved the way for doing so.

The legislation would allow people 21 and older to register to gamble online with any one of three casinos in Detroit or with Michigan tribal casinos.

House Bill 4926 and associated bills could generate millions of extra dollars in Michigan through an 8 percent sales tax on gaming.