Sobering information was presented at last Monday's Leadership Summit sponsored by the Business Leaders for Michigan. The presentations may be downloaded from the Business Leaders for Michigan website, on the left margin. Further news from the Summit: The bell is tolling for Michigan Detroit News, Business leaders face Michigan's fiscal reality Detroit News and Budget experts predict economic dire straits Detroit Free Press.
The conclusion from the Summit was that as dismal as some of the forecasts are, there are plenty of ideas that collectively can turn the state around. All that is needed is the political will to make the decisions. (And a few more Republicans elected wouldn’t hurt either!)
A step in the right direction is the passage of Senate Bill 1227 which amends the Michigan Public Schools Employee Retirement System (MPSERS). The Senate Fiscal Agency estimates the plan will save $650 million in the first year and $3.1 billion over 10 years by increasing employee contributions and requiring that new employees are placed in a more cost-effective hybrid defined benefit/defined contribution retirement plan. Newly Passed Retirement Bill a Step in the Right Direction
Friday’s Revenue Estimating Conference brought mixed news:
“. . . [S]chool aid revenue is up $292 million above January estimates. General fund revenue, however, is down nearly $244 million below estimates because income and business tax revenue has come in lower than expected. Senate Fiscal Agency director Gary Olson estimates that will leave a shortfall of about $219 million in the general fund budget for the current fiscal year, which ends Sept. 30.” MI school cuts not expected in 2010-11
“The three fiscal experts also agreed that based on a slightly improving economy, the state will have $128 million more in the general fund and $352 million more in the school aid account for the budget year that starts Oct. 1 than they initially estimated in January.” State revenue fund deficit: $244M: Economists say solutions include borrowing, making cuts or using one-time federal money
The state's economic future is still in jeopardy, but here is a bit of optimism in the midst of gloom. Salute!