LANSING — State Budget Director Jen Flood presented Gov. Gretchen Whitmer’s eighth and final state budget proposal to lawmakers at the Capitol on Wednesday, Feb. 11.
Whitmer can’t run for governor again because of constitutional term limits but she pointed to a budget legacy that includes record spending on K-12 education and expanding and protecting access to health care.
“My balanced budget proposal will build on our strong record of bipartisan success,” Whitmer said in a news release. “It doubles down on shared, long-term priorities to create good-paying jobs, fix roads, save Michiganders money, and ensure every child can read, eat, and succeed.”
Here are some key points:
Budget growth continues
The budget presented Feb. 11 calls for $88.1 billion in total spending. That’s up nearly 52% from the $58.1 billion budget for the 2019 fiscal year, when Whitmer took office.
Inflation has increased about 26% during that time, according to U.S. government data.
The increase in Michigan’s general fund — the state’s main checking account — has been more modest since 2019. Whitmer’s 2027 budget proposes $13.6 billion in general fund spending, which is up 28.3% from 10.6 billion in 2019.
Health care drives increase
Total proposed spending on the Michigan Department of Health and Human Services, which includes Medicaid spending, is $41 billion, representing 46.5% of the total state budget. And $7 billion of DHHS spending would come from the general fund, representing 51.5% of the total. That’s up from 41.5% of total general fund spending by DHHS in 2019.
By comparison, the Department of Corrections, which historically was the biggest single draw on the general fund until former Gov. Rick Snyder merged the Department of Community Health with the Department of Human Services, has seen its budget grow from $2 billion to a proposed $2.2 billion during the same period, or by only 10%.
Table set for budget fight
Whitmer’s proposed budget is balanced with about $800 million in new and increased tax proposals, which gets closer to $1 billion when counting fee increase requests that Whitmer is repeating after they were rejected by the Legislature in 2025. Those include higher hunting, fishing and boating license fees and increased charges to dump waste at Michigan landfills.
House Speaker Matt Hall, R-Richland Township, vowed at a Feb. 11 news conference to oppose tax increases, as well as a proposed $400 million withdrawal from the state’s Rainy Day Fund. He’s calling for spending cuts.
Economy a question mark
Amid conflicting economic indicators, uncertainty from tariffs, cuts in federal government support for states, and low consumer confidence, the May revenue estimating conference at the Capitol could take on extra importance ahead of the July 1 deadline for approving a 2027 budget.
At the January conference, revenue estimates were revised downward. If that happens again in May, finalizing the budget becomes that much tougher.
Property taxes as common ground?
Both Whitmer and Hall made reaching a road funding deal a priority last year.
In the end, they agreed on a $2 billion deal that included Republican votes for a new 24% wholesale tax on marijuana sales.
This year, Whitmer is proposing a property tax break for seniors as a major initiative and Hall has identified broader and bigger property tax relief as a top budget priority.
It remains to be seen whether the two leaders’ shared interest in property taxes can form the basis of a budget agreement, as their interest in road funding did last year.
Contact Paul Egan: 517-372-8660 or pegan@freepress.com.
This article originally appeared on Detroit Free Press: 5 things to know about Gov. Gretchen Whitmer’s final budget proposal
Reporting by Paul Egan, Detroit Free Press / Detroit Free Press
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