Whitmer will continue Snyder’s omnibus budget process

Rick Snyder and Gretchen Whitmer, 2012 | Michigan Municipal League, Flickr

In her first State of the State address last month, Gov. Gretchen Whitmer sought to distinguish herself from her predecessor, Republican Rick Snyder, by arguing that Michigan has to “act boldly and swiftly” and invest in schools and infrastructure.

But there was one area in which she praised Snyder: the budget process.

The Democrat threw down a challenge for the GOP-led Legislature to finish budgets before taking off for the summer, just as they did during the Snyder era.

As Whitmer gets ready to present her fiscal year 2020 budget on Tuesday, she’s looking to continue another Snyder tradition.

The governor also will use the omnibus budget process Snyder started, said Kurt Weiss, Michigan Department of Technology, Management and Budget (DTMB) spokesman.

So what does that mean, exactly?

Snyder’s stamp on budgets

Michigan’s budget process changed under Snyder.

Rick Snyder | Michigan Municipal League, Flickr

In recent decades, previous governors presented their state budget with spending priorities to the Legislature in either February or March.

One of the arguments that’s been made to keep a full-time Legislature is that it takes time to process spending for the state’s 10 million people. The current budget comes in around $56 billion.

Spending was divvied up by budget areas, such as higher education, environment, corrections, K-12 education and Michigan State Police. The Legislature took up the budget in a series of bills sent to House and Senate Appropriation committees.

There would be more than a dozen bills, but the exact number would vary — roughly corresponding with the state departments receiving appropriations. Appropriations subcommittees would then deliberate on bills, with panel chairs often having a big say over details in their respective budget areas.

Budget bills would go through several versions in both the House and the Senate and end up in conference committee, in which legislators from both parties and chambers would hash out a final deal. Then the full House and Senate would vote on individual budgets, one by one.

The process was time-consuming for both the governor and Legislature. It often only came to a close in the fall, not long before the Oct. 1 start of the state fiscal year. Last decade, leaders blew that deadline twice and briefly shuttered the government. 

Snyder, a former Gateway CEO, sought to streamline the process.

Michigan Capitol | Michael Gerstein

He presented his first budget in 2011 in omnibus form and the practice stuck. That meant that he had two gigantic budget bills: one for education — K-12, public universities and community colleges — and a general budget for everything else. This is known among some policy wonks as “rolling up” the budget.

As a result, the bills were long, raising questions if lawmakers actually read what they were voting on. The fiscal year 2019 omnibus general budget was 300 pages. The omnibus education budget was 107 pages.

However, even with an omnibus process, elements of the budget are broken down and considered by Appropriations subcommittees and then pancaked back together again.

“All of this stuff gets hashed out in committee anyway,” Weiss said. “You are going through the legislative process anyway.”

Kurt Weiss

Matthew Ferguson, a budget analyst with DTMB, said on the legislative side, he doesn’t “see a real practical difference” with rolled-up budgets.

Eric Lupher is president of the nonpartisan Citizens Research Council. He agreed that the omnibus process is not dramatically different from the way budgets used to get done.

“Cynically, it’s more window-dressing than substance,” Lupher said.

Democrats skeptical

But not all legislators were sold on the process, especially Democrats, who believed that this gave the Republican governor more power over spending decisions. 

“This budget process has moved far too quickly, and the plan signed by the governor is risky for the state’s long-term economic growth,” then-state House Minority Leader Rep. Richard Hammel (D-Flushing) said when Snyder signed his first budget in 2011.

University of Michigan | Creative Commons

But in the age of term limits, there aren’t many legislators left now who remember how the budget process worked before Snyder.

There has been considerable criticism about the education omnibus, as it has mixed the General Fund and School Aid Fund streams. The practice of using SAF funds for higher education began in the Gov. Jennifer Granholm era during fiscal year 2010, when Michigan was facing a multi-million deficit during the Great Recession.

But the practice accelerated under Snyder’s rolled-up education budget. In the current budget, $908.3 million has been diverted from the SAF, according to the nonpartisan House Fiscal Agency. That supports the entire Community Colleges budget and represents one-third of state funds in the Higher Education budget for the state’s 15 public universities.

Currently, 7 percent of the School Aid Fund goes to higher education institutions.

Snyder and proponents cite Article IX, Section 11 of the Michigan Constitution establishing the SAF, which states it “shall be used exclusively for aid to school districts, higher education, and school employees’ retirement systems, as provided by law.”

Groups including education unions and the Michigan League for Public Policy (MLPP) have opposed the practice.

Protest of Gov. Rick Snyder at
Benton Harbor Blossomtime Parade, 2011 | Brett Jelinek, Flickr

“Over the past eight years, the exception unfortunately became the rule, and using School Aid Fund dollars for higher education went from a last resort to the first order of business,” MLPP President and CEO Gilda Jacobs said in a press release last year. “Just because you can do something doesn’t mean you should. While this gimmick may be legal, it is morally and fiscally irresponsible, and lawmakers should put an end to the practice immediately and permanently.”

That’s one area in which Whitmer is likely to break with Snyder. She slammed the raid of School Aid Fund money during her 2011 to 2015 tenure as state Senate minority leader. And as a candidate for governor, Whitmer vowed to stop the practice.

Some observers also have argued the omnibus process dilutes transparency. But that also can make it easier to get budgets passed.

“Voting for just two large budget bills prevents lawmakers from having to vote up or down on specific issues involving each department,” MIRS and former Capitol Confidential reporter Jack Spencer wrote in a 2014 column. “This gives them plausible deniability.”

Brian Calley, Flickr

Brian Calley is a former state House member who served as Snyder’s lieutenant governor for eight years. He told the Advance that doing individual department budgets ran the risk of creating fund imbalance.

“It was all about making budget decisions in the context of all the other decisions that had to be made,” Calley said.

“[It was] recognizing that all these independent spending decisions don’t necessarily add up or result in the structural balance that we were looking for,” Calley continued. “Making the decisions and recognizing that prioritize in certain areas can affect prioritizes in other areas.”

Ken Coleman
Ken Coleman reports on Southeast Michigan, education, civil rights and voting rights. He is a former Michigan Chronicle senior editor and served as the American Black Journal segment host on Detroit Public Television. He has written and published four books on black life in Detroit, including Soul on Air: Blacks Who Helped to Define Radio in Detroit and Forever Young: A Coleman Reader. His work has been cited by the Detroit News, Detroit Free Press, History Channel and CNN. Additionally, he was an essayist for the award-winning book, Detroit 1967: Origins, Impacts, Legacies. Ken has served as a spokesperson for the Michigan Democratic Party, Detroit Public Schools, U.S. Sen. Gary Peters and U.S. Rep. Brenda Lawrence. Previously to joining the Advance, he worked for the Detroit Federation of Teachers as a communications specialist. He is a Historical Society of Michigan trustee and a Big Brothers Big Sisters of Metropolitan Detroit advisory board member.
Avatar
Susan J. Demas is an 18-year journalism veteran and one of the state’s foremost experts on Michigan politics, appearing on MSNBC, CNN, NPR and WKAR-TV’s “Off the Record.” In addition to serving as Editor-in-Chief, she is the Advance’s chief columnist, writing on women, LGBTQs, the state budget, the economy and more. Most recently, she served as Vice President of Farough & Associates, Michigan’s premier political communications firm. For almost five years, Susan was the Editor and Publisher of Inside Michigan Politics, the most-cited political newsletter in the state. Susan’s award-winning political analysis has run in more than 80 national, international and regional media outlets, including the Guardian U.K., NBC News, the New York Times, the Detroit News and MLive. She is the only Michigan journalist to be named to the Washington Post’s list of “Best Political Reporters,” the Huffington Post’s list of “Best Political Tweeters” and the Washington Post’s list of “Best Political Bloggers.” Susan was the recipient of a prestigious Knight Foundation fellowship in nonprofits and politics. She served as Deputy Editor for MIRS News and helped launch the Michigan Truth Squad, the Center for Michigan’s fact-checking project. She started her journalism career reporting on the Iowa caucuses for The (Cedar Rapids) Gazette. Susan has hiked over 3,000 solo miles across four continents and climbed more than 60 mountains. She also enjoys dragging her husband and two teenagers along, even if no one else wants to sleep in a tent anymore.

1 COMMENT

LEAVE A REPLY

Please enter your comment!
Please enter your name here