LANSING – House Democrats today criticized the Republican-led State Senate for a party-line vote that gives businesses significant tax cuts at the expense of funding for education, health care and public safety, and blasts a huge hole in the budget that was passed less than one month ago.
"The Republican-led Senate broke its promise to the people of Michigan that our state would have fully funded schools, health care for seniors, and police and fire protection for our communities," said House Speaker Andy Dillon (D-Redford Twp.). "It ignores the reality that Michigan will be in dire straits again in just a few years if this plan goes into effect. The Senate Republicans' plan is a short-term fix that will have long-term repercussions for the people of Michigan. It shows a complete lack of foresight and planning."
With a party line vote of 20-16, the State Senate voted to give a handful of Michigan businesses significant tax cuts, jeopardizing needed revenue for education, health care, police and fire protection, and job creation programs. The plan proposes significant changes to the Michigan Business Tax – which was signed into law in July – but replaces only $400 million in revenue, leaving a more than $300 million hole in the state budget.
On Nov. 8, House Democrats voted to repeal the service tax and replace the revenue that it would have brought in for the state with a surcharge on the Michigan Business Tax. The House plan won support from businesses and organizations across the state, including the Detroit Regional Chamber of Commerce, the Grand Rapids Chambers of Commerce and the Michigan Manufacturing Association. Democratic leaders worked closely with Michigan's business community and lawmakers from both parties to forge a consensus that will move Michigan's economy forward. In formulating their plan, Senate Republicans held no hearings and acted without gaining a consensus.
Dillon also noted that the Senate plan sunsets in 2011 – and that 32 of 38 lawmakers in the Senate will be ineligible to run for office again because of term limits, leaving it to their successors to fix the problem.
"Senate Republicans have set the state of Michigan up to fall into a giant black hole in 2011, when they won't be around to deal with the consequences," Dillon said. "This shows irresponsible and cowardly leadership. It also shows that Senate Republicans are willing steal from our residents and from Michigan's future to score points with a handful of businesses today. They should be ashamed of what they did today."
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