Commited to long-term reformsPublished 12:03am Thursday, January 19, 2012
You might have heard some numbers recently suggesting the state of Michigan is getting a big bonus this year. For the first time in at least 10 years, Michigan has more money than it expected. Revenues were higher than forecasts estimated for the past year by about $400 million, due in large part to surprisingly strong sales tax returns.
What are the exact numbers? For Fiscal Year 2011, the unexpected revenue is $457 million- with $204 million in unspent money and $253 million from tax revenue.
In 2012, the numbers continue to look good with revenues at $416.3 million more than expected. In FY 2013, the revenue increase should be around $200 million.
As good as it sounds, we cannot afford to irresponsibly spend this money on any ongoing commitments. The funding does not come from an ongoing source of revenue, and should be treated like any other one-time funds. Spending these dollars on an ongoing commitment will only create a hole in next year’s budget, or the following year’s budget.
This is why I believe the funding should be used to further pay down our long-term debts and rebuild our rainy day funds. We owe it to our children and grandchildren to leave them with a state that is better off than when we inherited it.
The January Revenue Estimating Conference crafts the budget recommendations by calculating numbers from the House Fiscal Agency, Senate Fiscal Agency and Treasury. The conferences are held in January and May of each year to help determine the final recommendations.
It’s true, the economy is turning around and it looks like things are finally improving in this state, but we have a long way to go before our work is done.
I hope that, with positive economic forecasts of definite solid growth, we can continue to plan towards the future by paying down debt and unfunded or underfunded liabilities, while working to create more stable revenue sources for education and local government.
I look forward to hearing your comments on these important issues. Please feel free to contact me by calling (888) 373-0078 or emailing email@example.com.
Tags: State Rep. Sharon Tyler