LANSING — State government debt has increased under Gov. Gretchen Whitmer, records show, despite her claims that she has paid down more than $28 billion in debt since she took office.
“Our fiscal house is in order,” Whitmer said at the Capitol on Feb. 25, during her eighth and final State of the State address.
By the end of her second term, Whitmer said, Michigan “will pay off $28 billion of debt.”
Whitmer, a Democrat who took office in January 2019, has cited similar, but steadily growing, figures in annual budget presentations and State of the State addresses, touting her successes in prioritizing fiscal responsibility.
But state of Michigan debt — as commonly defined by financial experts, including the State Budget Office — has increased under Whitmer, state financial records show.
State debt — the sum of general obligation bonds, revenue bonds, and short-term debt known as commercial paper — was $5.5 billion on Sept. 30, 2019, peaked at $7.3 billion in 2023, and sat at $6.6 billion at the end of the 2025 fiscal year, the most recent year for which an annual comprehensive financial report is available, records show.
The amount of debt owed by the state is important because it can impact how much revenue is available to spend on other priorities. Interest payments on long-term debts totaled $328.1 million in 2025, down slightly from $337 million in 2024, according to Michigan’s most recent Annual Comprehensive Financial Report.
So where does Whitmer’s $28 billion figure come from?
Asked for a breakdown, the State Budget Office released a chart showing state contributions to three state pension plans since 2020, the first fiscal year for which Whitmer presented a budget.
Since then, and counting payments proposed for the 2027 fiscal year, the state has paid $18.2 billion into the Michigan Public School Employees’ Retirement System, $8.6 billion into the State Employees’ Retirement System, and $1.3 billion into the State Police Retirement System, for total payments of just over $28 billion, according to the chart released by State Budget Office spokeswoman Lauren Leeds.
But total payments made by the state do not equate to total reductions in long-term pension liabilities, any more than the sum of a homeowner’s monthly mortgage payments equates to a reduction in mortgage debt.
“They’ve tabulated how much (in) payments they’ve made towards pension obligations over her period of time,” Craig Thiel, research director of the nonpartisan Citizens Research Council of Michigan, said of the $28 billion figure in a May 5 interview related to the Detroit Free Press findings on state debt.
“That’s not the same as saying that’s the amount of IOU’s that has come down.”
What’s more, the payments Whitmer is touting are mostly required under measures signed into law by Whitmer’s predecessor, former Republican Gov. Rick Snyder. Changes to state law in 2012, for example, required higher state contributions to the Michigan Public School Employees Retirement System, including payments for retiree health care, while also requiring higher employee contributions, as Snyder and the Legislature set a goal of eliminating all unfunded pension liabilities by 2038.
“A good portion of those (payments) are what you might deem required payments,” Thiel said of the $28 billion total. “Hey, good for you, you’re following the law.”
Leeds of the State Budget Office responded on behalf of the administration to debt questions sent to both her and Whitmer’s office. When challenged on the $28 billion figure, Leeds defended Whitmer’s use of the number while clarifying that it represented “payments to the pension systems that public employees depend on in retirement.” Leeds did not respond when asked about numbers on the State Budget Office website showing that state debt has increased under Whitmer, or about the fact that the vast majority of state pension payments made under Whitmer were required under state law.
Due to changes made under Snyder, reductions in net pension liability for the three plans since 2020, including postretirement health care benefits, actually exceed the $28 billion in payments cited by Whitmer, records show. But by themselves, payments don’t equate to debt reduction. Net pension liabilities are impacted by a raft of factors, including investment returns.
Whitmer drew pushback and criticism from Republican lawmakers in 2024 when she moved to save about $670 million by reducing the state’s annual payment to the school employee pension fund, arguing that postretirement health care was, by then, essentially fully funded, even if the overall pension plan was not. Republicans argued that state contributions to employee pension funds should not be reduced until all the plans are 100% funded. In October 2024, again over GOP objections, Whitmer signed into law a bill reducing pension contributions for school employees eligible for postretirement health care.
Some multistate comparisons of state debt include broader debt figures, such as pension liabilities and the debts of special authorities like the Michigan State Housing Development Authority or the Michigan Finance Authority, which are not considered general obligations of the state. Michigan generally ranks around the middle of the pack in multistate debt comparisons.
Whitmer’s statements about debt reduction are contradicted by information on the State Budget Office’s own website, where the Annual Comprehensive Financial Reports are also found.
A section titled “Frequently Asked Questions” includes the query: “How much debt has the state incurred?
“The state’s outstanding debt totaled $7.0 billion as of September 30, 2024,” is the answer given. “This was comprised of $691.3 million in general obligation bonds, $6.2 billion in revenue dedicated bonds, and $28.9 million in commercial paper.”
As of May 7, the State Budget Office website had not updated its website with the debt total as of Sept. 30, 2025, which the latest annual comprehensive financial report pegs at $6.6 billion.
The Internet Archive, which saves selected screenshots of webpages over time, shows that in February 2022, which is the earliest date on which this question and answer appeared on the State Budget Office website, state of Michigan debt was listed as a lower number — $6.2 billion.
That State Budget Office website from 2022 also gives a bar chart showing a five-year history of state of Michigan debt, showing that the debt number for the 2019 fiscal year, during which Whitmer took office, was lower still.
Lawmakers in the Republican-controlled House and Democratic-controlled Senate have passed separate versions of a 2027 state budget, with significant differences between them.
A revenue-estimating conference scheduled for May 15 at the Capitol in Lansing will be a significant next step in finalizing the 2027 budget.
Contact Paul Egan: 517-372-8660 or pegan@freepress.com.
This article originally appeared on Detroit Free Press: Whitmer claims to have paid down state debt. Actually, it’s increased
Reporting by Paul Egan, Detroit Free Press / Detroit Free Press
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