ESCANABA - Although more than 50 percent of new businesses fail within four years, Governor Snyder said he wanted to run the state like a business. The lesson to be learned from the governor's education/budget policy is that some businesses can be unprincipled.
After taxing pensioners 5 percent the governor has raided the education accounts of those pensioners' grandchildren.
School boards elected by their communities will try to deliver a proper education while the governor and legislature have shaken down the treasury for funds designated for K-12 education.
When the governor, Representative McBroom and Senator Casperson took office in January Michigan's non-education budget was headed for a shortfall. Their first action was to cut taxes on businesses, making Michigan's deficit even greater. To replace the tax on business they chose to tax pensioners and raid their grandchildren's educational fund.
A May 9, 2011, opinion piece in The Oakland Press called the action of these folks an outrage. Glenn Gilbert wrote, "What's happening is unspeakable - the kind of thing that gives government a bad name." What outraged Mr. Gilbert was the governor's broken promise and breach of trust with Michigan citizens.
In the 1990s a large portion of Michiganders wanted property taxes cut. Property taxes were the primary source of paying for local K-12 education. If money was needed to educate children a school district needed to go to local voters and ask for money. If local voters agreed, local property taxes were increased. Local communities held the purse strings for the education they would provide their children.
In 1994 a deal was struck with Michigan citizens. Known as Proposal A it said that if local communities gave up their authority to tax property for funding schools the state would increase the sales tax by 50 percent and put that increase into the School Aid Fund (SAF). The state would earmark other revenues to be deposited in the School Aid Fund as well. The state would distribute the School Aid Fund based upon the number of students in a school district. That was the promise. Voters approved Proposal A.
This year the money to be deposited into the School Aid Fund will be at least $631 million more than collected last year.
At the same time the rest of the state budget will be $1 billion short.
Nothing in Proposal A specifically said the state could not break its promise with its citizens. The governor called "Gotcha," and grabbed the money in the School Aid Fund.
In the last 10 years schools stuck to their 1994 promise and pinched pennies by cutting programs, books and supplies.
Like someone whose job was outsourced, districts dipped into their savings to make ends meet. They used their bank accounts, called fund balances or rainy day funds, to continue programs, many of which are mandated by state law.
Those school districts did the right thing. If the promise of Proposal A was kept there was light at the end of the tunnel. The School Aid Fund increased this year. Hallelujah!
Statewide the School Aid Fund will collect between $631 and $900 million more than last year. That is between $420 and $600 more per student than last year. Books and supplies could be purchased and programs reconstituted.
Governor "Gotcha" had a different idea. He raided the children's piggy bank, the School Aid Fund. Someone had to pay for tax breaks to business. Instead of increased revenue as promised in 1994, school districts will lose about $90 per child. Instead of an increase of $420 per student districts will lose $90 - a theft of $510 per student.
The Michigan Senate voted 19-19 to pass Governor Gotcha's budget. His lieutenant governor broke the tie. All Senate Democrats voted against plundering the School Aid Fund. Seven Republicans voted with the Democrats. Their names did not include Senator Casperson. State Representative McBroom voted with Governor Gotcha in the House.
A promise was made in 1994. A principled business would keep it. So should a governor and legislators.