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5:15 pm
Tue September 29, 2009

BUDGET UPDATE: Senate Votes to Cut Aid to Local Governments

LANSING, MI – The Michigan Senate has voted to cut Michigan's tax revenue-sharing payments to local communities by 11% to help balance a $2.8 billion budget deficit.

Cities, townships and counties use the money to cover police, firefighters and other services.

Revenue sharing is one of the most contentious parts of the state budget before Wednesday's midnight deadline. The House could vote later Tuesday.

The revenue-sharing cut is slightly less than what legislative leaders agreed to, but it is still a blow to municipalities already struggling with falling property tax revenues.

The bill also funds the state fair in Detroit. Gov. Jennifer Granholm has proposed cutting off the money.