Advance Notice: Briefs

State prepares for possible partial govt. shutdown on Oct. 1, despite ‘optimism’

By: - August 29, 2021 2:14 pm

Michigan Capitol | Susan J. Demas

After a budget impasse in 2019 between Democratic Gov. Gretchen Whitmer and the GOP-controlled Legislature that almost resulted in a partial state government shutdown, both sides agreed to get budgets wrapped earlier in the future.

Whitmer signed legislation setting a July 1 target date to present budgets to the governor — three months before the start of the next fiscal year on Oct. 1. But there were no penalties included for failing to do so. Last year, leaders agreed to delay the July 1 deadline in light of the COVID-19 pandemic, but the budget was signed before Oct. 1.

This year, Michigan missed the July 1 deadline again to complete next year’s budget.

And so on Friday, State Budget Director Dave Massaron sent an email to all department heads to prepare for a possible government shutdown, which the Advance obtained. Then-Budget Director Chris Kolb did the same thing in 2019.

“We are closing in on the month of September and we are without a signed budget for fiscal year 2022.  Because the new fiscal year is just over five weeks away, we must begin contingency planning in the event we do not have a signed budget by midnight on September 30.  While we remain optimistic and hopeful that we will reach a budget agreement with the Legislature prior to October 1, we must be prepared if that does not happen,” Massaron wrote.

He asked for department directors to submit information on functions and employees so that officials can “determine those functions within your department that would be continued and those that would be temporarily discontinued in the event of a government shutdown … to protect public health and safety.”

So how did we get here?

Whitmer and GOP leaders did strike an agreement this spring to negotiate the Fiscal Year (FY) 2022 budget — but did not commit to spending details — and COVID-19 orders. This came after a tumultuous year of Republican leaders fighting against her health orders and proposing big cuts to departments.

On June 30, the Senate passed a $17 billion School Aid budget, which Whitmer signed, so that part is done.

However, the Legislature blew past July 1 without passing a final budget for most state departments — which includes funding for local governments, state police, environmental programs and more and is expected to top $40 billion. The Legislature has not had many session days this summer, but negotiations have taken place between Massaron, House Appropriations Chair Thomas Albert (R-Lowell) and Senate Appropriations Chair Jim Stamas (R-Midland).

Michigan had two partial government shutdowns in 2007 and 2009 during the last divided government era. However, the primary issue then was the state was short on funds during the Great Recession.

That’s not the case for FY 2022, as the state has billions in unspent federal stimulus cash, something noted by Attorney General Dana Nessel, a Democrat.

“The work that goes into a state department having to plan for a govt shutdown is expensive and diverts important resources from other projects. In a year when Michigan is flush with billions of additional dollars in the treasury, this is an unnecessary and ridiculous exercise,” said Nessel in a tweet on Saturday. “It is an abdication of duty for the legislature not to-minimally-appropriate the same funding from last year’s budget & then decide where the additional stimulus dollars will go in order to avert a shutdown of of state govt. This is not a game. Time to put people over politics.”

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Susan J. Demas

Susan J. Demas is a 21-year journalism veteran and one of the state’s foremost experts on Michigan politics, appearing on MSNBC, CNN, NPR and WKAR-TV’s “Off the Record.” In addition to serving as Editor-in-Chief, she is the Advance’s chief columnist, writing on women, LGBTQs, the state budget, the economy and more. Most recently, she served as Vice President of Farough & Associates, Michigan’s premier political communications firm. For almost five years, Susan was the Editor and Publisher of Inside Michigan Politics, the most-cited political newsletter in the state. Susan’s award-winning political analysis has run in more than 80 national, international and regional media outlets, including the Guardian U.K., NBC News, the New York Times, the Detroit News and MLive. She is the only Michigan journalist to be named to the Washington Post’s list of “Best Political Reporters,” the Huffington Post’s list of “Best Political Tweeters” and the Washington Post’s list of “Best Political Bloggers.” Susan was the recipient of a prestigious Knight Foundation fellowship in nonprofits and politics. She served as Deputy Editor for MIRS News and helped launch the Michigan Truth Squad, the Center for Michigan’s fact-checking project. She started her journalism career reporting on the Iowa caucuses for The (Cedar Rapids) Gazette. Susan has hiked over 4,000 solo miles across four continents and climbed more than 70 mountains. She also enjoys dragging her husband and two teenagers along, even if no one else wants to sleep in a tent anymore.