Latest news with #SchoolAidFund
Yahoo
8 hours ago
- Business
- Yahoo
Group launches ballot initiative to fund public schools by taxing wealthy Michiganders
The statue of former Gov. Austin Blair at the Michigan Capitol | Susan J. Demas Underfunded public schools continue to be a political football in the Michigan Legislature, but a new coalition announced Thursday has a potential solution: taxing wealthy Michiganders and using the money to pay for schools. The coalition, Invest in MI Kids, is seeking to place a proposal on the November 2026 ballot that would change the Michigan Constitution's flat tax rate of 4.25% for individuals earning more than $500,000 and couples earning more than $1 million, increasing that to a surcharge of 5% on their income in state taxes. Invest in MI Kids noted in a news release that currently, average Michiganders – including the state's own teachers – and billionaires pay the same rate. The state's schools are estimated to be underfunded at $4 billion to $5 billion annually, the coalition said. The ballot measure, which needs 600,000 signatures to be placed on the statewide ballot in the next election cycle, would direct new revenue to Michigan's School Aid Fund and allow funding for things like career and technical education, attracting and retaining teachers, and reducing class sizes. That would have a positive impact on underfunded and underserved communities, the coalition added, with the revenue estimated to generate $1.7 billion annually for public K-12 schools. Rachelle Crow-Hercher is director of the Michigan Education Justice Coalition and part of the Invest in MI Kids ballot committee. In an interview with Michigan Advance, she said that most people agree that Michigan's education system needs to be fixed, but the main question she hears is whether that's a funding or a policy fix. 'I think it's a 'both/and' situation,' Crow-Hercher said. 'We're addressing the funding situation with this ballot initiative, but the other part of what we're doing is we're strapping our shoes on and going out to meet folks where they are and get their ideas for what they think we should change at the state level to make our schools better for all our kids.' The coalition described the ballot initiative as an admittedly bold plan, one that could shore up existing 'tax the rich' sentiments but could face headwinds from anti-tax and ultra-wealthy residents. Crow-Hercher said the momentum behind making those ultra-wealthy individuals pay their fair share in taxes to fund things like education is strong enough to get the initiative over the finish line, but she also believes that Michganders realize that the Legislature has failed continually to address adequate funding for schools. 'Between those two things, my sense is Michiganders across the state, rural and urban, are sort of ready for this type of bold plan,' she said. Molly Sweeney, organizing director of 482 Forward, said in a statement that Michigan's flat tax system was designed to benefit wealthy residents, not working families. 'That's why we're coming together to rewrite the rules so those who aren't paying what they owe in taxes finally chip in to support the services we all rely on – especially public education,' Sweeney said. Charlie Cavell, an organizer with Fund MI Future, said it was a matter of fairness. 'When you include sales tax and other taxes, working and middle-class families in Michigan actually pay a higher percentage of their income in state taxes than the top 1%,' Cavell said in a statement. 'That's upside-down. Our ballot initiative will restore balance and ensure that those at the very top finally contribute to our schools and communities like the rest of us already do.' The campaign is being backed by Michigan Education Justice Coalition, the American Federation of Teachers Michigan and dozens of grassroots organizations. 'We know that for years Michigan schools have been underfunded and students are feeling forgotten and unheard,' Christina Yarn, a senior at Heritage High School in Saginaw and a member of the Michigan Education Justice Coalition's Youth Collective, said in a statement. 'We have been suffering in schools that are falling apart, with little to no school transportation, schools that have poor water and air quality, where students aren't safe in their own classes.'
Yahoo
16-05-2025
- Business
- Yahoo
Trump tariffs will slow Michigan growth, kill 13,000 auto-related jobs, experts predict
LANSING — State officials agreed May 16 to revise downward state revenue projections by $456 million over the next two years, largely due to President Donald Trump's tariff policies, which one forecaster said will cost Michigan 13,000 jobs from the auto sector alone. Still, Treasurer Rachael Eubanks, Budget Director Jen Flood and other officials said they expect economic growth will continue in Michigan, but that it will be slower than what was forecast in January, when the last revenue estimating conference was held. That means the 2026 budget that state lawmakers are now working on will be tighter than anticipated. The new projections revised downward by $585 million how much the state can expect to collect in its general fund — the state's main checking account — in the 2025 and 2026 fiscal years. But that projected loss is softened by larger-than-anticipated growth in the School Aid Fund, which is largely supported by sales tax revenues. Officials revised upward, by $128 million, how much the state can expect to collect in the School Aid Fund in 2025 and 2026. More: U-M economists predict rising jobless rate, auto sales slowdown in Michigan as tariffs hit Forecasters who made presentations at the conference held at the Capitol stressed that a high degree of uncertainty surrounds their projections, as trade policy coming from the White House, which has major impacts on the automotive industry and other sectors of the Michigan economy, changes from week to week and sometimes from day to day. Gabriel Ehrlich, director of the Research Seminar in Quantitative Economics at the University of Michigan, told the conference that while uncertainty is high surrounding Trump's tariffs, he projects a 1.8% decline in domestic vehicle production in the next three to five years. That could equate to 3,300 direct job losses in the transportation equipment manufacturing sector, and 13,000 total Michigan jobs when spinoff effects are included. It's true that protective tariffs could result in more auto manufacturing being returned to Michigan from abroad, but that possibility is more than offset by the effect higher prices for vehicles will have on consumers, plus the effect of retaliatory tariffs other nations are expected to impose on vehicles manufactured in Michigan and elsewhere in the U.S., Ehrlich said. Left unanswered at the revenue estimating conference is how Trump's policies will impact the revenues Michigan receives from the federal government, which account for 42% of the overall state budget. Figuring out what federal revenues the state will receive is not part of the estimating process set out in a 1991 state law. State Budget Director Jen Flood said potential federal cuts are a major concern and she and her officials are closely monitoring budget developments in Washington, D.C. Potential cuts to Medicaid alone could have a $2 billion impact on Michigan, Flood said. Other areas of concern include cuts to the Supplemental Nutrition Assistance Program (SNAP), the federal Education Department, and funding for school meals, she said. The consensus estimates are rosier than those put forward by the Senate Fiscal Agency, which would have revised state revenues downward by $954 million over two years. But they are more pessimistic than estimates produced for the conference by the state Treasury Department, which pointed to only a $361 million reduction over two years. The downward projections came two days after the Michigan Senate passed a 2026 budget that is $1.1 billion higher than what Gov. Gretchen Whitmer proposed in February. The Senate version, mostly framed by Democratic lawmakers, is far from final and must be melded with a budget House Republicans are still working on. 'Our country has experienced significant changes since January, including shifting economic policies," said Sen. Sarah Anthony, D-Lansing, chair of the Senate Appropriations Committee. "The full impact of these changes is still unknown, so it's no surprise that the numbers presented at today's conference are more conservative than previous estimates." Senate Minority Leader Aric Nesbitt, R-Porter Township, called for spending cuts but also tax cuts as the budget is finalized. "If Michigan families have to tighten their household budgets, the Legislature has a duty to make the necessary cuts in our state budget and put money back in the pockets of those who need it most," Nesbitt said. Contact Paul Egan: 517-372-8660 or pegan@ This article originally appeared on Detroit Free Press: Forecast: Trump tariffs will slow growth, kill 13K auto-related jobs
Yahoo
15-05-2025
- Business
- Yahoo
Trump tariffs prompt nearly $1B reduction in state of Michigan revenue projection
LANSING — The Senate Fiscal Agency is revising state revenue forecasts downward by close to $1 billion, citing tariffs and economic uncertainty, and says the 2026 budget recently passed by the Senate would leave state government in a deficit. "Generally, employment growth is expected to be slower and inflation is expected to be higher than was predicted in January 2025," when state officials last made projections on state revenues, the May 15 report said. The forecast, one of three state reports that officials will consider May 16 when they meet at the Capitol to reach a consensus on how much tax revenue the state can expect to collect over the next three years, projects slowing national growth, with Michigan's economy growing more slowly than the nation as a whole. Economic uncertainty slows growth and shifting federal policies related to tariffs, spending cuts and layoffs have elevated that uncertainty to the highest level on record, the report said. The report projects that combined general fund and School Aid Fund revenues for the 2025 fiscal year will be $393 million lower than what forecasters projected just four months ago and $561 million lower for 2026. If the 2026 budget the Senate passed on May 14 were to become law, it would leave the state's general fund with a $969 million deficit, the report said. More: Drug overdose deaths down hugely in Michigan and across nation "A budget cannot be enacted with an estimated negative balance," the report said. The state's financial picture has eroded considerably since January 2023, when the state was sitting on a $9.2-billion budget surplus. Even as recently as this January, forecasts showed Michigan government still flush with cash. The approval of a budget by the Senate is only one step in finalizing a budget for the 2026 fiscal year that begins Oct. 1. The House is expected to pass its own version of the budget, after which the two chambers and Gov. Gretchen Whitmer are expected to reach a consensus on a budget that can pass both chambers in identical form and be signed by the governor. More: Senate budget axes some proposed Whitmer tax hikes but keeps higher hunting, fishing fees Unemployment in Michigan, which increased to 4.7% in 2024, is expected to increase to 5.6% in 2025 and 6.3% in 2026, the report says. Michigan's Inflation-adjusted income, which rose 1.4% in 2024, is expected to rise 1.2% in 2025 and decline 0.5% in 2026, the report says. "Uncertainty and transition currently dominate the economy," the report said. "Even as the economy remains in a post-COVID-19 transition, especially with respect to issues related to savings and wealth, consumption choices, and labor supply and demand, changes in federal fiscal policy have introduced additional sources of uncertainty and transition." Light vehicle sales, which totaled 15.9 million units in 2024, are expected to total 15.5 million units in 2025, declining to 14.4 million units in 2026 and 2027. By comparison, light vehicle sales averaged 17.1 million units annually between 2014 and 2019, the report said. Contact Paul Egan: 517-372-8660 or pegan@ This article originally appeared on Detroit Free Press: Trump tariffs prompt nearly $1B reduction in state revenue projection
CBS News
19-03-2025
- Business
- CBS News
Michigan lawmakers consider proposal to lower state income tax rate
A retroactive State of Michigan income tax cut proposal is moving through the state legislature, with the bill being passed to the Senate. It would revert the 2025 state income tax rate to 4.05%, the rate that was in effect during 2023. The tax rate bumped up to 4.25% for 2024. The lower rate also would be retroactive to January 2025. Any difference to taxpayers would show up as refunds or lower tax bills when 2025's income taxes are filed. The legislation, House Bill 4170 , had the sponsorship of about two dozen state representatives. It was introduced March 5 and passed the House Tuesday on a vote of 65 to 43, with two not voting. It now goes to the Senate for consideration. The income tax cut is based on the rollback premise that if general fund revenue outpaces inflation during the state's fiscal year, the individual income tax rate must be reduced proportionately. But a ruling declared such rate reductions must be considered temporary, and apply only to a single year. The new bill clarifies that any such changes would remain in effect until another rate change is triggered. "The revenue reduction would only affect general fund collections due to the school aid earmark formula effectively holding the School Aid Fund harmless from any rate reduction," according to the legislative analysis of the bill.
CBS News
12-03-2025
- Business
- CBS News
Powerball $250,000 prize forfeited as Michigan winner failed to make a claim
A $250,000 winning Powerball ticket sold in Michigan expired with no winner claiming it – so the money has been designated for the state's School Aid Fund. The Michigan Lottery made that announcement Tuesday, after the claim time officially passed. The ticket was purchased in 2024 at the Kroger store at 4099 Telegraph Road in Bloomfield Hills, lottery officials said. Powerball tickets are valid for one year from the drawing date. Part of the Michigan Lottery proceeds normally do go to the state School Aid Fund, with those contributions totaling more than $1 billion during fiscal year 2024 "While we want all players to claim the prizes they've won, providing an extra $250,000 to the School Aid Fund today is a big win for public education in Michigan," said Lottery Commissioner Suzanna Shkreli. The record for an unclaimed lottery prize in Michigan was set in 1998 when a $34 million prize went unclaimed. That ticket for the Michigan Lotto game was purchased in East Lansing.
