Michigan to face $2B budget squeeze in general fund

Wondering how much this may impact Lt. Gov. Calley’s run for governor.  Further, the chickens come home to roost at end of term limited Synder.

Lansing, Mich. — Tax cuts, increased road construction, past economic development incentives and other factors will combine to reduce or divert state revenue by $2 billion annually in just over four years — the equivalent of 20 percent of Michigan’s general fund account. That’s a key takeaway from a report issued this past week by the nonpartisan Citizens Research Council of Michigan.

Spending pressures

Beginning this year, the state is covering a small share of the cost to expand Medicaid insurance coverage to 660,000 low-income adults under the federal health care law. Within three years, $220 million will need to come from the general fund. If the expansion ends, Michigan still could face other costs because the federal expansion funding has been covering mental health and prisoner health care. The Citizens Research Council also notes uncertainty over how much the state could pay to help municipalities better provide legal representative to poor criminal defendants.

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