A state budget plan advancing in the Michigan House fights inflation with $1 billion in tax relief, pays off more long-term debt, and invests in important services from schools to law enforcement and local roads, Appropriations Committee Chair Thomas Albert said today.

“This is a budget plan that greatly benefits Michigan families and communities — today and for years to come,” said Albert, R-Lowell. “We propose significant tax relief and deliver it quickly to help families struggling under the weight of higher prices at the gas station and grocery store. We pay off more debt to set the stage for a financially sound future in Michigan communities and schools. And we invest in the improvements that will have long-lasting, far-reaching benefits for people across our state.”

The plan for the state budget year that begins Oct. 1 was approved by the House Appropriations Committee. It advances to the House floor for further consideration. Highlights include:

Tax relief: With inflation soaring, the House plan would leave room for $1 billion in annual tax relief starting in the upcoming fiscal year – significantly more than proposed by Gov. Whitmer. Her plan accounts for only about $369 million next budget year, and about $757 million once fully phased in through 2025. Whitmer has vetoed Republican plans to lower the income tax rate and suspend the gas tax, but efforts will continue to lower taxes immediately as part of the budget process.

Paying down debt and saving for the future: Escalating payments into public employee pension systems are eating away at the finances of schools and local governments. The House budget allocates more than $4 billion in additional one-time funding to offset debt in these systems, including $2.6 billion for the teachers’ retirement system, $1.2 billion for local municipalities, and another $350 million for the Michigan State Police pension system. “This important step will improve the finances of schools and local governments well into the future – without asking our kids and grandkids to pay off the debt piled up by their parents,” Albert said. The state would put more into savings — $100 million for the ‘rainy day’ fund and $674 million for the school aid stabilization fund – in case of an economic downturn. House Republicans have led efforts to restore the rainy day fund, moving it above $1.4 billion.

Supporting students: A record-high school aid fund of nearly $20 billion includes a per-pupil foundation allowance of $9,000 per student, up $300 per student from the current year and more than $2,000 from a decade ago. The House plan includes more than $500 million for teacher recruitment/retention, $300 million in school safety initiatives, an additional $210 million for special education cost reimbursements, and more resources for rural transportation.

These investments come on top of the more than $6 billion in federal COVID-19 relief the Michigan Legislature has approved for schools in the past two years.

Safer communities: In addition to the school safety investments, the budget includes more than $125 million for a variety of efforts to recruit and retain local public safety officers. It provides more than $100 million for law enforcement communication towers, and more resources for community policing initiatives.

Better roads: The House plan includes a Department of Transportation budget of nearly $6.8 billion, including an additional one-time investment of $750 million specifically for local roads – continuing House Republican efforts to improve roads without additional tax increases.

Workforce and economic development: The House plan continues efforts to train Michigan workers for high-demand jobs, and also invests $40 million in the Pure Michigan campaign so critical to the tourism industry and the state’s economy.

Family and maternal health: An investment of roughly $20 million would support the health of pregnant mothers and their babies – increasing access to prenatal and postnatal care, providing other vital services, and promoting adoption.

Albert also noted the House plan is designed to prevent abortion providers from receiving state or federal funds. The House also sets aside $750,000 in case the Legislature must defend the constitutionality of state laws on its own. For example, the Legislature may have to defend Michigan’s abortion law if the U.S. Supreme Court issues a ruling that overturns Roe v. Wade and Attorney General Dana Nessel follows through on her pledge not to defend that state law.

“If the attorney general and governor will not defend our state laws, the Legislature will,” Albert said.

In another government accountability measure, the House budget requires state employees to work in offices if they worked from offices prior to the pandemic.