Budget preparation in Michigan can be difficult

Matt Whetstone | Cadillac News Michigan Rep. Darwin Booher, R-Evart, discusses budgeting in Michigan Friday at the Lecture Luncheon Series sponsored by Baker College and the Cadillac Area Chamber of Commerce.

CADILLAC - The most important job for state legislators is to keep the budget in check, Rep. Darwin Booher, R-Evart, said Friday.

Booher spoke about budgeting and the economic outlook for the coming year at the Lecture Luncheon Series sponsored by Baker College and the Cadillac Area Chamber of Commerce.

Within the budget, legislators have to provide core services. The road to a strong economy depends on public safety and education.

“A good economy and good quality of life are critical in making our state go,” Booher said.

Without a strong economy, Michigan has lost jobs and population. The biggest concern with the exodus of residents is loss of political seats in Washington, D.C. Ultimately, the issues come down to budgeting and making sure the state is keeping its checkbook balanced while continuing to invest as much as possible in the future.

Booher, who serves on the House Appropriations Committee, said the house, senate and governor's office all provide budgets. In total, there are 18 individual budgets in the general fund. Of the $42 billion spent annually, about $9 billion is allocated to those 18 budgets through the general fund.

Looking at the general fund, four budgets - school aid/education, community health, human services and transportation - make up 83 percent of spending.

When legislators begin to work on budgets, they first look to revenue estimating conferences.

These reports are given to legislators several times throughout the year and project revenue to give decision makers a good idea of what money is coming in.

Booher said the conferences discuss state and national trends, such as gross domestic product, unemployment, interest rates and the housing market.

Once legislators have a grasp on the outlook, they can decide how to allocate general fund dollars. With economic recovery in mind, Booher said legislators have to ask themselves questions, like why should someone do business in Michigan? Should tax incentives be provided and how? How should the state handle the Single Business Tax and its $2 billion in revenue?

Looking at the budget being worked out for the 2006-2007 fiscal year to begin Oct. 1, Booher said it could be approved in July. As it's proposed, there is $110 million positive funding in the general fund and a $93 million positive balance in the education fund.

mwhetstone@cadillacnews.com | 775-NEWS (6397)