Governor Gretchen Whitmer signed a budget Tuesday totaling about $80 billion for K-12 schools, higher education, and other state government spending. The closed-door signing ceremony in the governor’s Capitol office capped months of contentious bargaining.
An official photo of the event shows Whitmer flanked by smiling Senate Democratic and House Republican leaders. The picture is a contrast to the tense negotiations that delayed a budget past the October first deadline and required a stopgap bill to avert a shutdown.
In a video announcing the bill-signing, Whitmer made no mention of the consternation and presented a sunnier view of the situation.
“This budget is a testament to what we can get done when we work together,” she said.
“We’re lowering costs so working families and seniors can keep thousands of hard-earned dollars in your pockets by continuing to roll back the retirement tax, continuing the Working Families Tax Credit and ending taxes on tips, overtime and Social Security,” she said.
The new budget plan sends all taxes collected at the pump to roads. It also has a modest increase for K-12 schools. It preserves free universal school meals, which Whitmer fought for in budget negotiations.
The budget package also relies partially on $420 million in new revenue from a wholesale tax on marijuana starting in January. That money would be directed the governor’s signature goal of funding road repairs.
But the budget bills were barely signed and filed with the Office of the Great Seal before the Michigan Cannabis Industry Association filed a lawsuit challenging the new tax.
The lawsuit filed in the Michigan Court of Claims alleges Whitmer and the Legislature unconstitutionally altered the 2018 petition-initiated and voter-approved Michigan Regulation and Taxation of Marihuana Act. The complaint says the new law is invalid because the Legislature failed to reach the three-quarter supermajority votes required by the Michigan Constitution to amend a voter initiative.
The new budget also zeroes out future funding for the governor’s economic development fund, which was a point of contention with Republicans in the Legislature. But House Speaker Matt Hall (R-Richland Township) said negotiations are underway for an alternative business-attraction program.
“What we need is something where we really prove that they’re really creating the jobs that they say they’re going to do and that they’re higher-paying jobs than what we would have otherwise, because why would you pay for jobs that are less than the average,” he said at a press conference following the bill signing.
Hall said he thinks a deal can be struck on business incentives before the end of the year.
