Michigan’s FY 12 – FY 13 Budget: A Vertical Analysis

INPUT Sr. Analyst Chris Cotner reports.

New Governor Rick Snyder and Utah convert turned Budget Director/Director of the Michigan Department of Technology, John Nixon released the Michigan Executive Budget for FY 12 and FY 13 on February 17, 2011. The new team was greeted with 10 years of $0 revenue growth, one of the highest unemployment rates in the country, and a projected $1.4 billion budget deficit in FY 12. While this may sound bleak and unfortunately representative of many states grappling with major revenue disruptions, it turns out Michigan is a little different. Budget deficits and hard times stretch back to the last recession in Michigan and in some ways give the state’s government a competitive advantage in making tough decisions to right-side the state’s financials. Two weeks before releasing this budget, John Nixon indicated that “…everything is on the table in Michigan” when it comes to building a balanced and strategic budget to move the state towards solvency.

The new administration has identified long term spending plans, program-specific adjustments, performance metrics, and government transparency as strategies to move from a reactive, crisis management mode of fiscal policy to a proactive spend management approach with a desired result of fiscal solvency.

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