By AARON MUELLER

Niles Daily Star

Michigan lawmakers have reached a tentative deal to balance the state’s budget, Rep. John Proos, R-St. Joseph, told the Berrien County Commissioners Thursday.

The deal, which includes no new taxes, an incentive package to encourage retirements of state employees and spending cuts to every state department, was reached Wednesday.

The deadline for the state to have a balanced budget signed by Gov. Jennifer Granholm is Oct. 1. State lawmakers have been unable to meet the deadline twice in the past three years, leading to short government shutdowns.

Proos offered his thoughts on the tentative budget deal to the commissioners Thursday.

“What is interesting is the governor has agreed that tax increases are not a solution to today’s budget concerns,” Proos said. “There are significant decreases across the board of 3 percent cuts in all departments.”

Proos also said there is an “early-out” program, similar to the one offered to teachers in June, that will encourage state employees to retire early. Lawmakers hope the incentive program will lead to the retirement of 6,000 employees and save about $60 million in the first year.

“If, for some reason, we don’t get the early out, we face a $60 million problem that will automatically come out of revenue sharing,” Proos said.

But if that does not happen, revenue sharing is expected to stay the same as last year.

The Senate also voted 21-14 Wednesday to move more than $200 million from the state’s school aid fund to the general fund, an important development toward balancing this fiscal year’s budget. The house passed it last month, and Granholm signed the bill Thursday afternoon.

The school aid fund currently has a surplus of $370 million, partly due to increased sales tax revenue, while the general fund is working with about a $300 million shortfall. The move helps repair that deficit.

Proos did not vote for the measure.

“My feeling is we should have found some savings in other areas,” he said. “But it’s not an unusual circumstance. In years previous where we’ve had challenges in school aid, the general fund has supported school aid.”

Overall, Proos said the tentative budget agreement features “some aggressive targets and significant cuts.”

“But when you look at our families and businesses, they’ve been making them every day,” he said. “And the state government ought to follow suit.”

Altogether, the budget will include about $600 million in general fund spending reductions, according to a State of Michigan press release.

“The agreement we’ve reached reflects our state’s most important priorities,” Granholm said in a statement Wednesday, “creating jobs, educating children and protecting citizens while building on the steps we’ve taken over the past seven years to address the fiscal challenges caused by the national recession and struggles in the auto industry.”