Governor’s FY25 budget proposal looks promising for counties

A state General Fund budget proposal of $14 billion that includes a $26 million boost in county revenue sharing for fiscal 2025 received praise this week from the Michigan Association of Counties.

“In light of the fact the governor is proposing a smaller General Fund amount for FY25 than what was budgeted for FY24, this is a good budget recommendation from our perspective,” said Stephan W. Currie, executive director. “We asked for increases in revenue sharing, funding for juvenile justice facilities and staff, Medicaid coverage for inmates, stormwater infrastructure funding and full funding for indigent defense obligations. On pretty much every point, we see good news in the governor’s proposals.”

Revenue sharing

Gov. Gretchen Whitmer calls for $281.2 million for county revenue sharing, with increases set in a mix of unrestricted and restricted formats. If approved, this amount would represent a $26 million boost from the FY24 baseline amount.

Governmental Affairs Director Deena Bosworth, however, cautioned that this amount is the starting point of budget talks, noting that last year’s budget work began with a large revenue sharing boost that was trimmed by the Legislature.

“We have to watch it through the entire process very, very closely,” she said.

The governor’s plan also did not reference the creation of a dedicated and secured Revenue Sharing Trust Fund, a MAC priority for 2024, but Bosworth said the progress made last year in the Legislature on that issue is a good sign for eventual passage.

Juvenile justice

Significant funding is recommended to address the juvenile justice bed shortage crisis and implement recommendations from the state’s Juvenile Justice Task Force:

• $38 million for in-patient child care payment methodology to assist with capacity issues
• $3.5 million for juvenile staff and programming
• $5 million for capital expenditures for juvenile facilities

Courts and jails

Whitmer’s plans in the criminal justice sphere are headlined by a $30.5 million allotment to cover health services for jail inmates slated for release who would otherwise be eligible for federal Medicaid coverage. This amount would be in service of a state effort to get a so-called Section 1115 Re-entry Waiver from the federal government to relieve counties of health care costs they now bear due to the Medicaid Inmate Exclusion Policy.

Reform of that policy is a MAC priority for 2024, so the governor’s budget is exciting news, said Governmental Affairs Associate Samantha Gibson.

Also notable in this realm are an Increase in the Medicaid reimbursement rate for behavioral health, additional funding for public safety officers and first responders for mental health treatment and new judges for Kent and Macomb counties.

The budget also calls for full funding for the Michigan Indigent Defense Commission’s (MIDC) work, but Gibson noted that this does not include an expansion of MIDC services to juvenile defendants.

Infrastructure

MAC was pleased to see a $15 million allotment for stormwater improvements, said Governmental Affairs Associate Madeline Fata.

But the FY25 plan has no additional funding for roads outside the PA 51 funding formula, she noted, despite the fact Michigan has a $3.9 billion annual deficit for road funding.

“MAC is a part of two separate coalitions trying to find new revenue sources for road funding,” Fata said. “We’re exploring a multitude of options.”

In what is sure to be a highly debated move at the State Capitol, Whitmer seeks a 1,289 percent increase in the tipping fees to place waste in landfills, moving it from 36 cents to $5 per ton. This would raise $80 million for environmental remediation efforts, recycling and landfill operations.

Additional coverage of the budget proposal will be released on Monday in the latest episode of MAC’s Podcast 83. Look for the episode alert in your email before noon on Feb. 12.

For questions on MAC’s budget advocacy, contact Deena Bosworth at bosworth@micounties.org.