Michigan Lawmakers Pass $75.2 Billion Bipartisan State Budget

Michigan lawmakers passed a $75.2 billion state budget for the 2027 fiscal year, reaching a compromise between the Republican-controlled House and Democrat-controlled Senate one day after the official deadline. The spending plan, which takes effect October 1, is $800 million smaller than the previous year and avoids tax increases or the use of the state rainy day fund.

Gretchen Whitmer characterized the plan as a "balanced, bipartisan budget." Key provisions include a nearly $20 billion school aid package with a $10,300 per-pupil allocation and the removal of the state retirement tax, which is expected to save seniors roughly $1,000 annually. The agreement also includes $200 million for free student meals, a $2 billion roads package, and the permanent reauthorization of the Pay As You Stay delinquent tax forgiveness program.

House Speaker Matt Hall led efforts to eliminate approximately $3 billion in waste, fraud, and abuse, including the removal of thousands of ghost employees. This resulted in funding cuts for the Department of Education (3%), the state agriculture department (6.8%), the Department of Natural Resources' general fund (13%), and the Department of Environment, Great Lakes & Energy (roughly 30%). Additionally, the budget implements stricter citizenship and eligibility checks for Medicaid and food stamps to ensure program integrity.