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Snyder budget: more for schools, roads

By David Eggert/Associated Press • Feb 8, 2018 at 8:00 AM

LANSING — Gov. Rick Snyder on Wednesday proposed boosting base funding for most of Michigan's public schools by the largest amount in 17 years, spending more on road repairs than planned and ending the use of a company to feed state prisoners.

In his eighth and final budget presentation, Snyder asked lawmakers for a $240 per-pupil increase for school districts that get the minimum grant, which would amount to a 3.1 percent boost for more than 75 percent of traditional districts and all charter schools. Higher-funded districts receiving the basic grant would get $120 more per student in the 2018-19 budget, a 1.4 percent increase.

"This is a significant increase and would close the equity gap between the high and low from the time we started (in office) by over 50 percent, which is very significant because we have many districts that are at the minimum," Snyder said.

The Republican governor also proposed shifting $325 million in general funds to road and bridge work, more than double the $150 million that is called for under a 2015 transportation-funding deal that is being phased in. And in a move that could spark opposition from at least some GOP legislators, he announced that a contract with Trinity Food Services set to expire July 31 will not be extended, by mutual agreement.

"I believe it's appropriate to say that the benefits of continuing on that path don't outweigh the costs, and that we should transition back to doing it in-house," Snyder told members of the legislative budget committees at the Capitol building.

Florida-based Trinity was hired in 2015 after the state ended a contract with Aramark Correctional Services after the company came under scrutiny for unapproved menu substitutions, worker misconduct and other issues. The state's initial outsourcing in late 2013 led to the loss of 370 unionized state jobs, which were replaced by lower-paid private employees.

The change would bring about 350 state workers back to prison kitchens, according to the Corrections Department. Director Heidi Washington said the "main challenge" with the existing contract was inadequate staffing levels.

The term-limited governor unveiled his budget blueprint at a time Republicans and Democrats in the GOP-controlled Legislature are pushing for election-year tax cuts beyond what Snyder has proposed to address an unintended consequence of the recently enacted federal tax overhaul. He pointed to $686 million in tax relief that already has been enacted for the 2018-19 fiscal year and noted that general fund spending would stay flat under his plan.

Still, when asked about his openness to enact a higher personal exemption than he called for last month, Snyder said "there's room to go beyond where we originally proposed."

Republican House Speaker Tom Leonard, of DeWitt, said the state has enough money to shift more to roads, forgive extra fees imposed on drivers for certain offenses, and cut taxes. He suggested transferring the additional $175 million for road and bridge repairs in the existing budget, so the improvements could be seen this year instead of in 2019.

"Get it out this spring, get it out this summer," Leonard said of the funding.

Also Wednesday, Snyder called for spending $61 million to improve legal representation for low-income criminal defendants as required under a 2013 law and another $26 million to respond to Flint's water crisis — mainly to provide continued state funds for the replacement of lead service pipes. And he mentioned previously announced proposal to increase a fee for taking waste to landfills and to create a new state fee on water customers — which seem unlikely to gain legislative traction.

His administration last week announced plans to close a Muskegon-area prison to save nearly $19 million in the budget.

Michigan's minimum per-student funding is $7,631. A $240 increase would be the biggest since the 2001-02 fiscal year, when a $500 hike was enacted. The only other time the minimum amount was boosted by more than $200 since then was in the 2006-07 budget.

Local government officials said Snyder did not propose enough funding for municipalities, and Democrats had a mixed reaction to his call to boost spending on deteriorating roads and bridges.

Rep. Fred Durhal III of Detroit, the top Democrat on the House Appropriations Committee, said he was "very pleased" with it. But Senate Minority Leader Jim Ananich, of Flint, said Snyder's budget "is an admission of failure on many fronts, particularly education and infrastructure. ... It's seven years late and many dollars short."

In coming months, legislators will next put their stamp on the blueprint, with a goal of enacting the spending plan in June — about four months before the start of the fiscal year. As Snyder delivered his hour-long presentation, members of the Service Employees International Union loudly protested outside the hearing room, criticizing his policies and supporting higher wages.

Key proposals in Snyder's budget plan

Here are some of its highlights in the governor’s $56.8 billion state budget proposal:

Roads

— A $325 million shift of general funds toward the roads and bridges budget. That would be $175 million more than what is required by law under a 2015 road-funding package. In that deal, which also boosted fuel taxes and vehicle registration fees, the state will gradually transfer more from the general fund to transportation over time. Snyder wants to accelerate road work.

Education

— A $120 to $240 per-pupil increase for K-12 school districts. For the 75 percent of districts receiving the minimum grant, the $240 boost would be the largest in 17 years.

— Up to $50 in funding for each student enrolled in a career and technical training program.

— The continuation of a $25 per-pupil grant for each high school student.

— A 2 percent bump in overall operations funding for Michigan's 15 state universities, ranging between a 1.5 percent increase for Lake Superior State to a 3.1 percent boost for Oakland University.

— To qualify for their full state funding, universities would have to limit tuition increases to 3.8 percent — or $490 based on the average per-student tuition cost statewide.

— Funding for 28 community colleges would remain flat.

Prison food

— The end of the privatization of prison food service, which began in 2013 and Snyder says has been unsuccessful and would be too expensive to continue when an existing contract expires in July.

Law enforcement

— $6.1 million to hire 80 state police troopers to address attrition and another 50 new troopers on top of the existing force level.

— $9.2 million to train more than 350 corrections officers to fill vacancies.

— $1.5 million to fund 10 new conservation officers.

Environment

— A proposed increase in the landfill dumping fee from 36 cents per ton to $4.75 per ton to generate $79 million annually for cleanup of contaminated sites and other environmental programs. The revenue would replace the Clean Michigan Initiative, a bond issue approved by voters in 1998 that generated $675 million but is expected to dry up this year. Snyder says the average cost per family would be $4.75 a year.

Water infrastructure

— A new state fee on water customers in systems of 1,000 or more users. The maximum fee would ultimately reached $5 a person per year. It would generate $110 million to pay for asset management, grants and loans for water and sewer infrastructure, and a fund for water and sewer emergencies.

— $26 million to address Flint's water crisis, largely to continue replacing thousands of lead pipes. Lead from the lines seeped into the water supply after regulators failed to require anti-corrosion treatment.

Indigent defense

— $61.3 million to help 134 local indigent criminal defense systems implement four initial minimum standards created in the wake of a 2013 law to improve publicly funded defense for poor people accused of crimes.

Revenue sharing

— Constitutionally guaranteed state payments to cities, villages and township would rise by nearly $25 million, or 3.1 percent, due to higher sales tax collections.

— They would see no boost in statutorily allowed revenue sharing.

— Counties would see a slight dip in revenue sharing of less than 1 percent.

Other one-time spending

— $20 million to expand broadband access.

— Using more than $100 million in unspent money from the last fiscal year to pre-pay costs to build new veterans homes in the Detroit and Grand Rapids areas, and to make infrastructure upgrades at the Capitol. Snyder says it would save $48 million in interest costs.

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