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Wed September 23, 2009
House, Senate committees fail to break budget impasse
By Rick Pluta, Michigan Public Radio Network
LANSING, MI – At the state Capitol Tuesday, negotiating teams of House and Senate members hoped to take a big step toward resolving the state's budget crisis. But instead, the impasse continued with most of the state budget trapped in limbo. The deadline for finishing the budget is a week away.
The impasse is rooted in the fact that not enough lawmakers will vote for the big cuts needed to retire a deficit that's gobbled up a third of the state budget. And, not enough lawmakers can bring themselves to vote for the new taxes that would be needed to avert unpopular spending cuts, like eliminating the Michigan Promise college scholarship. The Promise scholarship pays $4,000 to every student who completes two years of college or job training. But, until lawmakers identify a way to pay for it, the future of the Promise scholarship is uncertain.
About 50 college students gathered in front of the state Capitol to rally in support of the scholarship. The turnout was a lot lighter than the organizers had hoped for. They billed the event as a -quote-"Storm the Capitol" rally.
But Mitchell Rivard of the Michigan State University College Democrats predicted lawmakers who don't vote to keep the scholarship will pay a political price since 90 thousand families are counting on it.
"This is something where I think we'll see a massive student outrage," Rivard says. "I think parents are going to call Lansing just like they have been over the past couple months, letting their senators and representatives know we cannot make these cuts. These are too drastic, too deep."
While the money's not there now, Democratic state Representative Joan Bauer says she's still hoping "that as we put the final details on a budget, that we will reinstate funding for the Promise grant, that that will be part of a budget plan. That is what I continue to fight for, advocate for, and that means coming up with 120 million to 140 million dollars, and that is to fully fund our promise to the students of Michigan," Bauer says.
Bauer chairs the House higher education budget subcommittee and the House and Senate negotiating committee looking for a budget compromise.
But Bauer says she does not have a lot of room to negotiate. She and other House budget chairs were handed targets that called for big spending cuts. She'd like to come up with some plans to generate revenue. But House and Senate leaders have not - publicly, at least - said they're ready to do that.
"I think the public and taxpayers want to see us try to do this without revenues, and to try to make tough cuts," Bauer says.
Democratic House Speaker Andy Dillon says he feels obligated to make a good faith effort to find every spending reduction possible before trying to make the case for tax hikes or some other mechanism for raising more revenue.
"I don't want to see the cuts to Medicaid," Dillon says. "I don't want to see the deep cuts to revenue sharing, so I'm trying to solve those problems as we work through these committees, but until you see where the differences are, and how short we are it's hard to identify how much revenue we'd need to get these budgets done."
Dillon and Republican Senate Majority Leader Mike Bishop set a deadline that came and passed with most of the negotiating teams failing to reach a deal. Republicans insist that increasing taxes would only prolong Michigan's seven-year recession.
Lieutenant Governor John Cherry -- who, like Governor Granholm, supports new taxes to balance the budget -- says the impasse increases the likelihood that the Legislature will be forced to adopt a temporary budget that continues current spending to avert a government shutdown next week.
"Well, I think it's certainly an option that allows government to stay open, I don't think it's you can repeat every month," Cherry says. "But maybe it helps bridge a couple of weeks, but I think everybody would be a lot more comfortable if there was just a resolution to happen and bring the whole process to an end."
But the problem remains pretty much what it's been all along - there aren't enough votes for any particular approach to prevail. Not enough lawmakers will vote for the big cuts needed to retire a deficit that's gobbled up a third of the state budget. And not enough lawmakers can bring themselves to vote for the new taxes that would be needed to avert unpopular spending cuts.