Recently, the framework for next year's state budget (Fiscal Year 2013) began to take shape when both legislative chambers passed their respective spending plans. Eyeing a June 1 deadline, both chambers have offered their responses to Governor Snyder's Executive Budget issued in February. Both legislative proposals reduce the General Fund appropriation recommendation included in the Executive Budget.

Although the proposals share some key similarities, there are key differences in a number of areas, including funding for K-12 education. CRC's State Budget Note Reconcilable Differences - Towards Completion of the FY2013 State Budget looks at the main components of each legislative proposal and examines how they differ and what issues will need to be resolved through negotiation. Final budget development will also have to consider the Governor's recommendations. Although total budgeted amounts in some areas are similar across all three iterations, beneath these totals lie notable differences in the details - how dollars are allocated across programs, services, and sub-state entities.

"While a major milestone in the budget process has been cleared, much work remains before the final FY2013 state budget can be enacted," said Craig Thiel. "Unlike the FY2012 budget which required substantial appropriation reductions to address a projected $1.5 billion deficit, the FY2013 budget benefits from the actions taken to solve the FY2012 deficit and improving economic and revenue forecasts, which allow for increased appropriations in some areas. The challenge will be reconciling how to distribute the limited additional state resources available among the competing interests when they are not sufficient to fully restore past funding reductions."

CRC's note on the state's budget progress is available at no cost on the Citizens Research Council's website www.crcmich.org.
Founded in 1916, CRC works to improve government in Michigan. The organization provides factual, unbiased, independent information concerning significant issues of state and local government organization, policy, and finance. By delivery of this information to policymakers and citizens, CRC aims to ensure sound and rational public policy formation in Michigan. For more information, visit www.crcmich.org.