Granholm, lawmakers continue Michigan budget talks

LANSING, MI – LANSING, Mich. (AP) - Gov. Jennifer Granholm appears to be leaving several options open for resolving Michigan's state budget problems.

Granholm told reporters shortly after meetings with legislative leaders Thursday that trimming the size of various tax exemptions or "loopholes" could be included in a budget-balancing plan. She said reducing a surcharge on the Michigan Business Tax could be considered as part of a deal.

Granholm has said she is not interested in a general tax increase to help balance the budget for the fiscal year that starts Oct. 1. Money from the federal stimulus package will be used to fill much of the state's projected $2.7 billion budget shortfall.

But cuts will be needed, possibly including the scaling back of a college scholarship program.