Agency: Michigan to get $422M less than expected

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LANSING, Mich. (AP) - Legislative economists estimated on Tuesday that the state will collect about $873 million less revenue in this budget year and the next than was projected in January, likely complicating lawmakers’ work to finalize Michigan’s next spending plan in the coming weeks.

The forecast from the nonpartisan House Fiscal Agency is one of three that Gov. Rick Snyder’s administration and experts will use Thursday to reach a consensus on revenue projections. House economists said the state will take in $422 million less than forecast in the current fiscal year and $451 million less than expected in the year starting in October.

The Senate Fiscal Agency has yet to release its report. The state Treasury Department’s estimate typically is not made public ahead of the revenue-estimating meetings.

Ari Adler, spokesman for House Speaker Jase Bolger, R-Marshall, said states across the country are collecting less tax revenue than estimated, and Michigan legislators will know more Thursday. Lawmakers want to pass the state’s $50 billion-plus budget by late May or early June.

“Of course we’re concerned and watching because Michigan is not immune from what is happening in other states,” Adler said.

He said the House forecast is a reminder that revenue projections are only estimates.

“Things change and we need to be flexible and adapt as the national economy shifts and we continue to move forward with responsible budgets,” Adler said.

Nearly three-fourths of the hit - $627 million over two years - would be in the general fund, which pays for prisons, human services, aid to local governments, many state agencies and other programs. The school aid fund would see $246 million less than projected over two years.

If budget experts agree that revenue is trending downward, it could affect a road-funding plan that recently passed the House, talks of a tax cut and Snyder’s proposed significant funding increases for local governments and public universities.

Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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