Whitmer Proposes $80.7B Budget: Here's What's In It

MICHIGAN — Gov. Gretchen Whitmer unveiled Michigan's 2024-25 budget proposal Wednesday.

The $80.7 billion budget proposal focuses on boosting k-12 spending, expanding taxpayer preschool programs and community college to be free and using state money and policies to lower the cost of large-cost expenses such as housing, medication, vehicles or utilities.

The plan aims to make two years of community college free to any new high school graduate. It also looks to expand taxpayer-funded preschool programs to be free for any 4-year-old, regardless of a family's income.

The budget shows it would cost taxpayers roughly $63.5 million to lift any income caps on who can get taxpayer funded preschool for four-year-olds and roughly $30 million for any high school graduate to pursue an associate's degree for free.

Another part of the budget calls for investing $370 million to support k-12 school operations through a 2.5 percent increase in base per-pupil funding that equates to an additional $241 per student, for a total of $9,849 per-student.

Whitmer's plan to help pay for these investments in the classroom calls for redirecting roughly $670 million that would normally go to cover liabilities in the state's teacher retirement system.

A comprehensive 2022 financial report showed the system's retiree healthcare had $641 million in assets, exceeding liabilities for benefits owed.

In other words, the $670 million is free to redirect because long-term liability is almost fully funded, according to the State Budget Office.

Whitmer, a Democrat, said the state's actions were "kinda like paying off your mortgage early."

"So we've got dollars that we don't have to continue using toward that," Whitmer said.

Other educational investments include spending $300 million for student mental health and school safety needs, $200 million to continue providing universally-free breakfast and lunch to Michigan’s 1.4 million public school students, among others.

Whitmer also proposed spending $200 million for tutoring through the MI Kids Back on Track program, and expanding learning opportunities through before and after school programs.

The proposal also details plans for economic development, including investing $500 million to attract new manufacturers and industries, making Michigan more competitive nationally for high-paying jobs.

Another plan calls for spending $100 million on a research and development tax credit to spur innovation while lowering costs for businesses.

Under the Infrastructure section of the proposal, plans call for spending $700 million to finish some road projects, including Interstate 94 along the Metro Airport and Interstate 696 from Southfield through Warren.

Infrastructure plans also call for investing $247.6 million to improve state and local roads, highways and bridges across the state.

Lawmakers will begin debating the new budget proposal in the coming weeks, with hopes of approving something by July 1. The 2024-25 fiscal year starts Oct. 1. Michigan's 2023-24 budget was $82 billion.

"My balanced, fiscally responsible budget recommendation for fiscal year 2025 builds on the historic investments we’ve made since I took office and delivers on the issues that make a real difference in people’s lives," Whitmer said. "Together, let’s lower costs for working families, deliver the Michigan Guarantee to offer every Michigan child a free public education from pre-K through community college, save family caregivers thousands on their taxes, and power our economic and workforce development to build and lead the future. Let’s get it done so everyone can ‘make it’ in Michigan."