CADILLAC — Legislators got used to setting the state budget early.

Under Republican Gov. Rick Snyder, who never contended with a legislature dominated by the opposing party, budgets were done months in advance of the Sept. 30 deadline.

It's different now. Republicans still control the Michigan legislature, but a Democrat, Gretchen Whitmer, serves as governor.

And the state budget for Fiscal Year 2020 is still not set. It's the first year in eight years legislators and the governor haven't had a deal by this point in the calendar.

"All the local schools and governments knew what they were getting," said Rep. Daire Rendon, R-Lake City, during an interview in late July. "This year, that's not the case."

Legislators may have gotten used to budgets being done early, but school officials remember when that wasn't the case.

"Actually, it is not abnormal for schools to not have a final budget from the state by the start of the year," said Emily Kearney, chief financial officer for Cadillac Area Public Schools. "Prior to Governor Snyder, this was the norm."

But the delay isn't exactly popular.

"Frustrating" is what two superintendents said.

 "It is frustrating not knowing the amount we will receive," said Len Morrow, superintendent of Manton Consolidated Schools. "We had to have our budgets set at the end of June." 

"First, not having a state budget when we have to do our budget in June makes it very frustrating," said Shirley Howard, superintendent of Evart Public Schools. "We are guessing on how much the foundation allowance will be."

Evart schools will probably have to make adjustments to line items once they know how much they'll receive, she said.

Likewise, Cadillac school officials are planning for budget tweaks.

"We approved a responsible and realistic budget for 2019-2020 and plan to amend once the governor's budget has been released," Kearney said.

Cash flow could be a problem if there's no budget in place by the deadline.

"Our August state aid payment is the last payment for the 2018-19 year. There is no state aid payment in September so our first payment is received in October," Howard wrote. "Hopefully the budget will be in place by then. If it drags on then I am unclear what happens."

Both Morrow and Howard said programs at their schools are not vulnerable.

"We are not worried about any programs right now," Howard said. "More of a concern would be holding off on purchasing items that we expected to buy."

But at the county level, Missaukee County Administrator Precia Garland and Wexford County Administrator Janet Koch said indigent defense was a concern.

“Our biggest thing is the public defender budget,‘ Koch said, explaining that because there are new requirements for indigent defense in Michigan, local governments aren't sure if the costs associated with running the program will be funded 100%.

Indigent defense and revenue sharing are the largest state budget items causing concern, Garland said. Without a budget, revenue sharing payments could be delayed. And exactly how much revenue will be shared with local governments is still unknown.

"When the governor proposed her budget, it included a 3% increase in revenue sharing.  However, earlier this year the Senate’s proposed budget included a 0% increase," Garland wrote in an email. "So, at this point, we’re still waiting to know what will be appropriated for state revenue sharing and when it will be appropriated."

In the city of Cadillac, a big chunk of state revenue goes toward local roads.

"Cadillac relies on the State annually for over $1 million in state shared revenue to fund core services, $900,000 for major street maintenance, $200,000 to maintain the state trunkline routes that pass through the City, and $300,000 to maintain our local neighborhood streets," said Owen Roberts, the city's finance director. "These are significant dollars."

Road funding has been a major sticking point in the governor's proposed budget—she proposed raising the gas tax 45 cents, but legislators haven't bit.

"I’m cautiously optimistic that the sides will come together quickly to pass a budget," Roberts said. "We’re hopeful that this budget will help us locally with some additional funding to better address the problem of deteriorating roads."

Rendon said she thinks the legislature and Gov. Whitmer are getting closer to an agreement.

"Negotiations have been ongoing with the governor, that I do know,‘ she said. “We’re getting close, I’ve been told.‘

Cadillac News