News Story

Unsupported Numbers In State Budget Impasse News Story

Cites Michigan League for Public Policy President Gilda Jacobs

A report about the current state budget impasse in Lansing reprinted by the Metro Times stated that Gilda Jacobs, president and CEO of the Michigan League for Public Policy, said that Michigan was collecting less tax revenue than 50 years ago. The publication reported, “In fiscal year 2019, Michigan had less money coming into its coffers than it did 50 years ago, according to Gilda Jacobs, CEO of the Michigan League for Public Policy.”

Total state appropriations for 2018-19 were $33.1 billion, according to the Senate Fiscal Agency. In the 1970-71 fiscal year, $2.3 billion in state revenue was appropriated and spent, which would be the equivalent of $15.0 billion today, when adjusted for inflation.

The story also included an actual quote from Jacobs, “Beyond the general fund, inflation-adjusted school revenues are below 1995 levels.” This may not be incorrect, but it lacks context.

State budget reports from before Michigan’s “one-state recession” of the 2000s and the nation’s Great Recession of 2008-09 describe a different state economy than the one that came out of those experiences. A Michigan Capitol Confidential analysis from January of this year summed up the damage:

- Michigan lost 805,000 Michigan jobs from 2000 to 2009.
- State per-capita personal income dropped from 18th-highest in the nation in 2000 to 38th place in 2009.

State tax revenues for schools and other purposes stagnated or fell as the incomes of Michigan’s people fell. But starting with the 2010-11 fiscal year, revenues have risen steadily. State spending on K-12 schools has increased every year since 2010-11.

The Michigan League for Public Policy did not respond to an email seeking the source for Jacob’s claims.

The article was written by Diane Bernard of Public News Service. Bernard wrote: “As the Michigan Legislature continues to negotiate the state budget Thursday, lawmakers are being urged to address the need to create revenue to tackle shortfalls in areas such as infrastructure and education.”

State taxpayer revenue flowing into Michigan’s state transportation fund and the K-12 school aid fund has never been higher.

The state’s transportation fund is projected to have raised and spent a record $3.64 billion in 2018-19, with the figure projected to jump to $3.99 billion by 2021. From 2010-11 to 2018-19, state revenues given to transportation have increased by $1.39 billion above the rate of inflation.