A new formula that would fund more
communities, but provide a smaller increase to those currently receiving aid,
was approved by a House Appropriations General Government Subcommittee. State Representative
Earl Poleski (R-Jackson), Chair of the Subcommittee, proposed the bill last
week, and an ammended version was passed.
The Economic Vitality Incentive Program
(EVIP) currently provides revenue sharing dollars to 486 cities. Under Representative
Poleski’s proposal, current members would receive a 1 percent increase. 1,105
additional cities, villages and townships would receive per capita payments of
$7.14609, as long as they receive at least $5,000, raising the total number of
local government entities receiving revenue sharing payments to 1,492. The
current threshold is $3,000, and if the proposal is approved the new minimum of
$5,000 will cut off 17 local governments from revenue sharing.
The proposal would change the way in which
communities receiving more than $50,000 would qualify for their money.
Communities entering the program for the first time would have to meet the
current requirements for transparency, service sharing and the handling of
retirement benefits. Each mandate completed would entitle the communities to
1/3 of their payment.
Communities that were in the program as of
the 2012-2013 fiscal year would still have to meet transparency requirements,
but the service sharing mandate would be replaced by a requirement that the
community commits at least 5 percent of its statutory revenue sharing to road
maintenance. The retirement benefits mandate would be replaced with a required
commitment of 5 percent of their statutory payment to unfunded accrued
liabilities.
Additionally, local governments that have a
dedicated millage for roads would not have to spend another 5 percent to make
this requirement; they would simply be required to spend that 5 percent. This
is a change from last week’s version of the bill. State Representative Fred
Durhal (D-Detroit) believes that the state should abolish EVIP requirements and
return to statutory revenue sharing, but supports funding more communities.
The committee, while approving the budget for
nine departments funded by the general government budget bill (HB
5301), also approved language requiring departments and agencies to give 14
days notice before finalizing a salary increase exceeding 5 percent.
Representative Poleski said the move came in response to large raises approved earlier
this year for fund managers in the Department of Treasury which were as much as
90 percent.
Attorney
General
The Subcommittee approved half the increase
sought by Governor Snyder to combat human trafficking, at $200,000. This was
the only major change to the Governor’s recommendation of $90.8 million in
funding, a 1.9 percent increase from the current year.
Executive
Office
The subcommittee made no changes to the
Governor’s recommendation for executive office operations, approving $5.9
million, a 10.2 percent increase from the current year. Most of the increase
stems from the Governor’s newly created Office for New Americans to assist in
attracting high-skilled immigrants to Michigan. The increase specifically for
Executive Office operations totaled 3 percent.
Legislature
The overall budget for the legislative branch
was $131.9 million, a 6.6 percent increase from the current year. The
Subcommittee appropriated an additional $360,000 to fund operations at the
Capitol on top of the $3.1 million recommended to designate the Capitol as a
historic site. The budget also included a $4.8 million increase to fund
legislative staff and operations.
State
The Subcommittee approved a $1 million
increase for auto insurance fraud prevention, $800,000 less than what Governor
Snyder had recommended. The state budget overall would contain $222.3 million,
a 1.7 percent increase from the current year.
Technology,
Management & Budget
The subcommittee cut Governor Snyder’s
proposed $28 million increase for upgrading the state’s IT systems to $14
million, totaling a $47 million appropriation. It also rejected the Governor’s
proposed doubling of funding for the Regional Prosperity Initiative. However,
it did support the $9 million proposed increase for the Michigan Public Safety
Communications System to replace equipment and a $7 million increase for new
cyber security initiatives. The total DTMB budget contains $1.27 billion, a 6.3
percent increase from the current year.