Lansing Update: February 12, 2010

In this week’s Lansing Update:

1. Governor Details 2010–11 Budget Recommendations Amidst $1.7 Billion Deficit
2. “Body Parts” Bill Moves on to Full Senate

Governor Details 2010–11 Budget Recommendations Amidst $1.7 Billion Deficit

By cutting some $570 million out of the state’s general fund, raising another $550 million through a new statewide service tax, and relying on more than $700 million in federal funding, Governor Granholm this week announced her recommendations for the 2010–11 state budget, which currently faces a $1.7 billion deficit.

Presenting her recommendation to a joint meeting of the House and Senate Appropriations Committees, a constitutional obligation, Governor Granholm’s biggest headline [Link no longer available —Ed.] lies in lowering the state sales tax to 5.5 percent and extending that tax rate to customer services, such as haircuts and dry cleaning, which are not currently taxed. According to the governor, the extension of the service tax will plug a $410 million deficit in the state’s school aid fund.

And in order to cut an additional $570 million out of the general fund, the governor is looking to secure early retirements for approximately 37,000 state workers, who would be replaced by fewer and lower-paid employees that would contribute more to their own personal health care benefits.

One major concern for the Catholic Conference is the governor’s recommendation to eliminate the Michigan Tuition Grant [Link no longer available —Ed.] program, which provides a $2,100 grant to needs-based students attending one of Michigan’s 21 independent and private institutions of higher education, many of which operate in the Catholic tradition. The governor has recommended eliminating the grant in seven of her eight budget recommendations. Each year, however, the Legislature has reinstated the funding. The Tuition Grant represents two percent of the higher education budget, although independent colleges enroll more than 25 percent of the state’s four-year higher education population, according to the Association of Independent Colleges and Universities of Michigan. The grant primarily benefits lower-income students who otherwise would be financially unable to attend the school.

Michigan’s social safety net fared well in the governor’s budget recommendation, as no programs such as the children’s clothing allowance or the Family Independence Program, Michigan’s welfare system, face jeopardizing cuts. In the Department of Human Services, the state department that primarily bolsters Michigan’s destitute population, over $100 million in additional general funds is being recommended in order to hire an additional 850 case workers. The department is currently facing a catastrophe with case loads. But a more controversial proposal from the governor lies in the Department of Community Health.

The governor has proposed a three percent Quality Assurance Assessment Program fee for which those in the medical community — hospitals and nursing homes, for example — would be responsible, raising approximately $500 million for the department. The state currently uses taxes on physicians to draw increased federal revenue; the three percent increase would mean an additional $2.74 on the dollar, according to the governor. Should the Legislature fail to pass the tax increase, an 11 percent cut to Medicaid providers would come from the executive office. Last year, the State Senate overwhelmingly defeated the tax, meaning its chances for survival in this year’s budget are minimal.

Other highlights of the governor’s budget recommendation include:

• Requiring all state budgets to be completed by July 1 (which would require a constitutional amendment);
• Requiring two-year budgets;
• Closing four to five prisons, through a “good time” policy, saving the state an additional $129 million; and
• Retooling the Michigan Promise grant from a maximum $4,000 scholarship for college bound students to a $4,000 tax credit if the student stays in the state for at least one year following graduation.

Overall, according to Gongwer News Service, the governor’s proposal would create a $47.1 billion state budget, with $11 billion in school aid spending; $7.9 billion in the general fund; $2.8 billion in state generated transportation funds; $5 billion in fees; and some $20.1 billion in federal funding. Both chambers’ departmental appropriations subcommittees will now begin the work of passing budgets onto their respective full appropriations committees before coming to a floor vote. The House and Senate will then reconcile their budget differences before sending the 2010–11 state budget onto the executive office for the governor’s signature.

“Body Parts” Bill Moves on to Full Senate

Michigan families may soon legally have the right to know if a county medical examiner has retained any portion of a deceased person’s body, according to legislation passed by the Senate Local, Urban & State Affairs Committee this week.

Last year a woman had found out that her mother was buried without her brain, which was kept by the county medical examiner for study, without the daughter’s knowledge. A property rights lawsuit was filed, which spurred legislation that would allow a county medical examiner to maintain any portion of the body considered necessary to establish the cause of death, the conditions contributing to death, or the manner of death, or as evidence of any crime.

While one version of the legislation has passed out of the House of Representatives a similar version was under consideration by the Senate committee. Acting on requested counsel from the National Catholic Bioethics Center [Link no longer available —Ed.], MCC staff worked for a substitute version of Senate Bill 800, which would require a medical examiner to attempt to notify the deceased relative or representative (verbally or in writing), if the retained body portion were an entire organ or limb, and offer them an opportunity to request return of said limb or organ.

SB 800 would also require the medical examiner or a deputy to keep a written record of the notification efforts for one year. MCC staff strongly urged the committee to additionally require that if circumstances necessitate verbal contact, that written notification also be required.

The full State Senate is expected to pass the bill within the coming weeks, with the amendment supported by the Conference.