Granholm, leaders huddle on budget

LANSING, MI – Governor Granholm spent much of Thursday huddled behind closed doors with her budget team and legislative leaders. They're trying to decide how much to cut, and how much federal stimulus funding they'll use to balance the budget.

The budget for the coming fiscal year has a deficit officially pegged at $1.8 billion. In reality, tax collections are flagging, so the deficit's probably even bigger.

The Republican spending plan has bigger cuts - including eliminating the $4,000 Michigan Promise scholarship for students who complete two years of post-high school education. The Democrats' spending plan also has cuts, but not as big. They want to use more federal stimulus dollars, and find more revenue by eliminating some tax breaks.

It's difficult to know what direction the talks are taking because Governor Granholm and Republican and Democratic leaders have agreed the details of their discussions will remain secret until there is a budget deal.