Michigan Governor Gretchen Whitmer stated Wednesday that she will “keep delivering on kitchen-table issues such as jobs and schools, clean water, and thriving small business.”
Whitmer attempted to determine how the billions of dollars of state surplus should be spent during her fourth State of the State speech. She is now preparing to push for tax subsidies targeted to the Republican-led Legislature.
Whitmer advocated for increasing the state’s earned tax credit from 6% to 20% of the federal credit and repealing an amendment that in 2011 added pension income to the state income tax.
According to the governor, she wants “to reduce the retirement tax and save 500,000 Michigan households an average of $1,000 per year.”
The federal credit of 20%, which would restore the Michigan Earned Income Tax Credit, would help “more than 22,000 people from working poverty.” It also sends 730,000 families an average of $3,000 dollars in refunds that they can use for their bills. The EITC is a benefit to nearly 1 million children in Michigan, almost half of them under the age of 15. This means more hot meals, warmer coats and new backpacks.
Whitmer suggested plans to reduce the cost of insulin and automobiles, while mentioning plans to reduce the pension tax for seniors and increase the earned-income tax credit.
Attorney General Dana Nessel opened an investigation into Eli Lilly’s insulin costs this week. Legislators are also considering bills that would limit insulin prices to $50 per month.
Whitmer stated, “We all agree insulin is too expensive, and we can work together for drug companies to be held accountable, lower costs and save lives.” Let’s do it together.”
Whitmer also suggested a $2,500 rebate on electric vehicles and an “historic investment to retain, recruit and promote hundreds more mental health workers.”
The first-term Democratic governor stated that the speech will be delivered from Detroit Diesel in Redford Township, where electric vehicle technology is being built. According to a state archivist, the Metro Detroit location will be the first time a governor delivers a State of the State address outside Lansing for more than a century.
The governor stated that Michigan Republicans and Democrats have demonstrated they are able to work together to provide resources for bipartisan issues like small business relief, childcare subsidies and schools and educators, new post at the Michigan State Police, criminal Justice reforms, and skills training.
She praised the state’s recent announcement that $666 million in incentives was to be used to augment General Motors $7B investment in electric vehicle manufacturing facilities in Lansing, Orion Township. This move countered the belief that Michigan doesn’t have the resources or unity necessary to compete with other states.
Whitmer stated, “Yesterday, we saw the world see what we can achieve together.” “Democrats and Republicans, businesses, utilities and labor joined forces to provide Michigan with solid economic tools that will attract large projects and create thousands more jobs.
After the state had a surplus of $1.7 billion, Republican legislators are trying to stop Whitmer’s attempts to set the terms for debate. This was in addition to the higher than expected state tax revenues of $1.7 billion.
Wednesday’s vote by the Michigan Senate Finance Committee saw a proposal to cut taxes by $2.3 billion. Thomas Albert, R. Lowell, House Appropriations Chairman, called for “targeted, sustainable tax relief” for Michigan residents.
Sen. Jim Runestad (R-White Lake), who chairs the Senate Finance Committee, said, “This is the right time to do it.”
The bill would lower Michigan’s corporate income tax rate to 3.9% from 6% and the personal income tax to 3.9% from 4.25% from 3.9%. The bill would allow individuals to claim $500 credit that is non-refundable for each dependent below the age of 19.
16 of 22 Republicans from the state Senate are co-sponsors or sponsors of the legislation, including Senate Majority Leader Mike Shirkey (Clarklake).
According to one Senate GOP estimate, the legislation could generate $2.3 billion in tax cuts over a full year.
The Senate Republicans have also proposed to increase the senior income tax exemption. Runestad requested the governor in a Tuesday statement to collaborate with Senate leadership and House leadership to speed up legislation to provide “meaningful relief for working families and seniors.”
Whitmer stated that she would propose the largest state education funding increase for public schools in over 20 years. This announcement was made after Whitmer and the GOP led legislature approved a historic $17.1billion funding plan for schools. The funding plan was supported by a one-time federal COVID relief dollar.
As several school districts including Detroit and Flint made the controversial decision to switch to remote learning this month, the governor stated that students “belong in school”.
Whitmer stated that in-person learning is the best way to learn. Remote learning isn’t as rewarding or conducive for a child’s growth. Learning in person is crucial for mental health and social development. We will do our best to keep children in school.
The governor praised infrastructure improvements, stating that since her election three years ago, Michigan has rebuilt, repaired or rehabilitated over 13,000 lane miles and nearly 900 bridges. This, while also supporting almost 82,000 jobs. She also mentioned prominent projects such as the ongoing work on Detroit’s Gordie Howe bridge, which she stated is set to surpass the Statue of Liberty.
Whitmer also stated that she will reinstate a prevailing wages for state construction contracts in 2021 and highlighted the billions of dollars available through Biden’s Bipartisan infrastructure plan.
Due to decades of neglect, underfunding and decades of neglect, our infrastructure task — roads, lead pipes, high-speed internet — is huge. She explained that we are fixing roads and bridges using the right materials and mix to ensure they remain fixed. We’re also creating skilled, well-paid jobs in the trades along the way — the kind that you can afford to raise a family, as well as solid benefits and a secure retirement.
Whitmer’s speech was his second consecutive virtual address. The increase in COVID-19 hospitalizations and cases meant that Whitmer wouldn’t have to give it before the Legislature.
This address is a follow-up to a virtual address of less than 30 minutes last year, in which the Democratic Governor urged the GOP-led Legislature for common ground after months of heated debate about the governor’s handling COVID-19.