Michigan counties now can see estimates for their fiscal year 2025 revenue sharing payments via projections recently released by the Michigan Department of Treasury.
These projections offer an insight into how the new distribution model of the $291 million in county revenue sharing will affect each county.
The changes to the distribution methodology are the result of the changes made to the state’s FY25 enacted budget. For years, county revenue sharing was based on an outdated model that was rooted in values from, among other things, a 1975 inventory tax, inflationary increases for those counties still drawing down from a reserve fund and random percentage increases and decreases decided on by the legislature and the administration. The old methodology also required counties to earn a portion of their revenue sharing with reports at the local level and state level.
The new methodology has its roots in previous distributions, but the unprecedented $30 million increase for county revenue sharing this year will be distributed based on a county’s taxable value, as compared with the rest of the state. To be clear, all counties will see an increase in revenue sharing for FY25, compared to previous years. However, the actual impact on each county’s budget from the $30 million increase will vary depending on the final 2024 taxable values.
The new projections are based on the taxable values from 2023, which have been used as the foundation for estimating the amount each county will receive. However, it’s important to note that the actual payments to counties will be calculated based on the 2024 taxable values, which are expected to be released later in September. This means that the figures currently provided are preliminary and subject to change once the updated taxable values are available.
The Department of Treasury is expected to notify counties of the final revenue sharing amounts during the week of Sept. 2, but they will only be projections until the 2024 taxable values are finalized.
The FY25 projections provide a valuable early look at the funding counties can expect in the coming fiscal year. While the final amounts will depend on the forthcoming 2024 taxable values, these projections serve as an early indication on what counties can expect to receive. For more information on this issue, contact Deena Bosworth at bosworth@micounties.org.