Sep 17, 2007

Senate passes a one-month continuation budget

LANSING – Just a few hours after a press conference where Gov. Jennifer Granholm said she would veto a continuation budget if it is not linked to a tax increase, the Senate did just that today, passing Senate Bill 772 and 773 along party lines.

“The idea of a continuation budget to solve the budget problem is ridiculous and ludicrous,” said Sen. Gilda Jacobs, D-Huntington Woods. “…If the goal is to shut down government then a continuation budget surely accomplishes that.”

The bill provides a temporary budget for one month for the fiscal year that begins Oct. 1. Senate Republicans, who control the Senate, said it would allow bond payments so the state does not default and payments will be made to local school districts. The state has to make up a $1.8 million budget deficit. The bills passed on a straight party line vote of 20-17, and Sen. Valde Garcia (R-Howell) was absent.

“If we came to an agreement today on how we can balance the budget with reforms, cuts and revenue it is doubtful if we can put the necessary rules in place to pay our bills in time by the first week of October,” said Sen. John Pappageorge, R-Troy.

The Democratic controlled House met in a marathon session all weekend and today to try and pass a state income tax increase to 4.6 percent from 3.9 percent. Both the Senate and House have said it will take a combination of cuts, reforms and new revenue to balance the budget. However, the Senate refuses to pass any tax increases, and no House Republican will vote for any increase either.

Senate Minority Leader Sen. Mark Schauer, D-Battle Creek, used sports analogies like “it’s gut-check time” and the Senate was “punting,” saying a continuation budget may be necessary, but an agreement on a 12-month fix should be in place first.

“This is accepting defeat and waving the white flag,” he said. “What’s worse is we don’t even know what is in the bills because it appoints a 10-person committee.”

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