When Michigan’s fiscal year (FY) 2007 and 2008 budgets were finally resolved last year, measures that provided substantial government reform were largely absent. Although some taxes were raised, some spending cuts enacted, and some modest changes to public employee benefits were adopted, Michigan’s structural deficit remains, and it will grow to a deficit of $9.6 billion by FY 2017—only ten years away—if current spending and tax policies continue.
Recognizing the significant budget proportion represented by corrections, Medicaid, and public employee compensation and benefits, this report builds upon the recommendations provided by a number of organizations and provides specific options for policymakers to consider.
These options are not intended to provide relief for the state budget in the near term; rather, they will restore the state’s fiscal health over the next decade and lay the foundation for future economic prosperity