Gov. Whitmer unveils $80.7B FY25 budget recommendations

LANSING, Mich. — Governor Gretchen Whitmer presented her Fiscal Year 2025 Executive Budget Recommendation to a joint session of the House and Senate Appropriations Committees Wednesday in Lansing.

The governor’s FY25 aims to lower costs, power economic development and guarantee education from pre-K through postsecondary to help people “Make it in Michigan.”

"Michigan's fiscal house is strong and we're making investments in the dinner table issues to make people's lives more manageable, ensure every person has a path to prosperity in the state of Michigan, and I think this budget is a great way to make sure that that's a reality for all Michiganders," Gov. Whitmer said.

This budget recommendation totals $80.7 billion, which is one billion dollars fewer than the previous year’s budget.

It includes a general fund total of $14.3 billion and a school aid budget totaling $19 billion.

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Budget breakdowns for several categories are listed below:

Lowering Costs

• $37.5 million to create the Caring for MI Family Tax Credit.
• $25 million for the MI Vehicle Rebate.
• $500,000 to continue the federal EBT summer food benefit program.

A Better, More Affordable Education

K-12 Education

• $370 million to support school operations through a 2.5% increase in base per-pupil funding.
• $300 million to continue historic investments for student mental health and school safety needs.
• $251.2 million to help students reach their full academic potential, including continuation of payments for literacy grants and literacy coaches.
• $200 million to continue providing universally-free breakfast and lunch to Michigan's 1.4 million public school students.
• $200 million for tutoring through the MI Kids Back on Track program.
• $175 million in recognition of the crucial role high-quality teachers play in the success of their students, including continued support of the MI Future Educator Program.
• $159 million for continued expansion of free pre-K to every four-year-old in Michigan, two years ahead of schedule.
• $127 million to continue expanded support for special education students — a 12% boost in the state allocation from adjusted current law levels.
• $125 million to provide a 5% boost in funding to support academically at-risk students, English language learners, career and technical education students and students in rural school districts.
• $125 million to continue reimbursements to districts for transportation costs.
• $45 million for additional supports for vocational education and career and technical education, including equipment upgrades and a new pilot program to connect high school students with key local industries to support pathways to certifications, credentials and careers.

Higher Education and Workforce Development

• A 2.5% ongoing boost for university and community college operations.
• $30 million investment to boost funding for the Michigan Achievement Scholarship.
• $62 million to continue Michigan Reconnect, providing tuition-free schooling for adult learners ages 25 and up.
• $20 million boost in the Tuition Incentive Program.
• $14 million for the North American Indian Tuition Waiver, providing tuition-free education to eligible Native Americans at Michigan public universities and community colleges.

"We know that the smartest investments we can make are in the education of our people, and that starts with our youngest people," Gov. Whitmer said. "That's why bumping up the goal of having universal pre-K by two years and making it available in this next budget is something that is really important."
Making it in Michigan

Economic Development

• $500 million in continued investment in the Strategic Outreach Attraction Reserve fund to attract new manufacturers and industries to Michigan.
• $100 million for a research and development tax credit.
• $60 million to establish an Innovation Fund to invest in startups and help launch hundreds of new Michigan-based companies, creating thousands of jobs.
• $80 million to clean up contaminated sites.
• $25 million for the Build Ready Sites program to identify and prepare sites in Michigan for future development or redevelopment.
• $20 million to build off the iconic Pure Michigan campaign.
• $20 million for business attraction and community revitalization.
• $20 million to boost funding for Going Pro.
• $20 million to provide specialized economic assistance to businesses locating to or expanding in Michigan.
• $5 million one-time and $11.1 million ongoing for the Arts and Cultural Program to expand grants to arts and cultural institutions that support the economy and contribute to vibrant communities.
• $4 million for global talent and retention.
• $2.5 million for the Office of Rural Prosperity to expand outreach and grant funding in rural communities.

Rebuilding Infrastructure

• $700 million to authorize the final tranche of the Rebuilding Michigan Plan to fix the roads, including I-94 along the Metro Airport, I-696 from Southfield through Warren and a bridge in Erie Township.
• $247.6 million to improve state and local roads, highways and bridges.
• $150 million to support local bridge and culvert improvements and ensure the state fully matches available federal highway aid.
• $75 million to support federal transit capital grants, marine passenger services, rail operations and transit capital matching funds.
• $40 million to provide loans and grants to local communities to support projects associated with lead service line replacement.
• $30 million in grant assistance for local transit agencies to spur innovation to connect Michiganders with with new public transportation options and link communities together.
• $17.1 million to reinvest in our state parks from revenue generated by making the Recreation Passport opt-out — More Michiganders will be able to experience the natural wonders of Michigan's state park system, while granting free access to veterans.

"Most of our housing stock is very old. We, like every other state in the country, need more affordable housing. There's just not enough housing," Gov. Whitmer said. "It is important that we are building in earnest. That's why I've said, 'build, baby, build,' that's going to be the focus. $1.4 billion is ten times more than what we were putting into housing just ten years ago."
Balancing Michigan's Budget, Cutting Red Tape

• Pays off a "mortgage" early (certain Michigan Public School Employees' Retirement System liabilities), freeing up $670 million that can be invested into classrooms to help children learn.
• $100 million deposit into the Budget Stabilization Fund, which will bring the grand total in the rainy day fund to more than $2.2 billion by the end of FY25.
• $10 million deposit into the Disaster and Emergency Contingency Fund to support immediate response and recovery activities in the event of a disaster or emergency.
• $4.4 million to improve turnaround time and public outreach for environmental permitting.
• $500,000 to establish a hazard mitigation assistance program to help local governments implement projects that reduce natural disaster risks.
• $4.8 million to boost childcare facility inspections.

Public Safety

• $11 million in statutory revenue sharing (2% one-time) dedicated specifically to public safety, including employee recruitment, retention, training and equipment for first responders.
• Hire and train 120 Michigan State Police troopers, and $5.5 million to support salary and equipment costs of the 145th state police trooper recruit school.
• $5 million to establish Training, Recruitment and Retention grants to support local law enforcement agencies.
• $5.5 million for community violence intervention services to reduce gun violence and save lives.
• $10 million for lifecycle upgrades to the state's safety communication system.
• $11.9 million to continue implementing improvements based on recommendations of the Task Force on Juvenile Justice Reform.
• $6.3 million for various investments to increase offender success through education, training and reentry programs.
• $1.4 million to protect the State Capitol by increasing MSP's capacity to safeguard those who work in and visit the Capitol and Heritage Hill.

Public Health

• $193.3 million to establish new Certified Community Behavioral Health Clinics sites across the state.
• $15.7 million in funding to continue the Healthy Moms, Healthy Babies program, which helps new and expectant mothers receive the care they need and reduce racial disparities in infant and maternal mortality.
• $46 million for changes to the Family Independence Program, the first substantially meaningful changes to the FIP program since 1990.
• $24 million to provide new funds to communities that identify innovative approaches to support expectant parents and newborns.
• $1.8 million to ensure children have access to healthcare through MIChild.
• $15 million for the Michigan Energy Assistance Program to reduce energy bills for low-income households struggling to pay energy bills.
• $5 million to help low-income households weatherize and improve the energy efficiency of their homes, reducing utility bills.
• $7.3 million to ensure people experiencing behavioral health crises have access to the Michigan Crisis and Access Line 24 hours a day, seven days a week.
• $5 million for smoking cessation and tobacco prevention programs.
• $1.5 million to boost the clothing and holiday allowances for children in foster care.
• $500,000 for technical assistance and equipment to ensure the water is safe to drink at the state's child care centers.

A Fairer, More Equitable Michigan

• $35 million to implement recommendations of the Racial Disparities Taskforce, including neighborhood health grants, mobile health units, sickle cell support and more.
• $1.5 million to fund grants to nonprofit organizations to reduce veteran homelessness.
• $5 million to continue the MI Contracting program to assist small and disadvantaged businesses in securing equipment and insurance to help them compete for contracts.
• $3 million to create the Secure Retirement program, a state-managed retirement plan marketplace that allows small businesses to participate and provide optional retirement savings plans to their employees at no cost to the employer.
• $2.4 million to make state government more accessible by ensuring information and materials are provided in the languages spoken by Michiganders.
• $800,000 for state certification, credentialing and endorsement of approximately 1,000 interpreters serving deaf, deafblind and hard of hearing communities.

The budget also includes $27.5 million to provide a 5% increase in ongoing statutory revenue sharing to help counties, cities, villages and townships.
And, in addition to the previously mentioned $11 million included for public safety initiatives, the recommendation also includes $16.5 million for a 3% one-time incentive in revenue sharing to local communities that obligate their federal COVID relief funds.

FY25 Executive Budget Recommendation Presentation by WXMI on Scribd

Now, the budget heads to committee for hearings and negotiations.

It must be approved by July, according to state statute, before going into effect on October 1, 2024.

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