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HOUSE APPROPS, WITH PASSIONATE DEBATE, OKS BUDGET Democrats and Republicans dug in their heels Wednesday over their deep differences on the 2005-06 budget as the House Appropriations Committee with only GOP votes approved a spending bill for nearly all of state government with major cuts. Key House GOP proposals opposed by Governor Granholm: Medicaid eligibility eliminated for caretakers and 19- and 20-year-olds. $5 monthly co-pay for "nonexempt Medicaid adults"; additional $3 co-pay for physician visits. 1% cut to program that compensates hospitals based on the type of procedures performed on Medicaid recipients. Big spending increases for University of Michigan-Dearborn and Central Michigan, Ferris State, Grand Valley State, Oakland and Saginaw Valley State universities with sharp cuts to Northern Michigan and Wayne State. Welfare recipients who have received aid for more than four years cut off of assistance January 1; four-year limit set; maximum welfare check reduced; day care for welfare recipients cut. Funding for job creation services cut. 12 percent cut in arts grants. Legislators from the political parties traded sharp barbs throughout the day leading up the 18-11 Appropriations Committee vote. The full House is expected to vote on the omnibus spending bill (HB 4831) Thursday. Democrats excoriated Republicans for pushing a bill that would remove Medicaid coverage for 43,000 residents, discontinue welfare assistance for 15,000 cases, close two prisons, cut job creation services funding and require co-pays for some Medicaid recipients and higher co-pays for others. Republicans retorted that their bill does not rely on the numerous tax increases requested by Democratic Governor Jennifer Granholm to fund her budget and, contrary to Democratic criticism, protects vulnerable residents. For a detailed breakdown of the entire House GOP budget, see the Tuesday edition of Gongwer News Service. The yawning differences between legislative Democrats/the governor and Republicans, who control the House and Senate, set the stage for protracted and difficult negotiations to finalize a budget before the 2005-06 fiscal year begins October 1. But both sides, while lambasting the other, also hinted at willingness to budge from their positions. Rep. Scott Hummel (R-DeWitt), chair of the Appropriations Committee, said raising the new taxes and fees sought by Ms. Granholm would damage Michigan's economy, and that should be state government's top priority. "Would we like to do more? Sure we would. Who wouldn't?" he said just before the committee vote. "But the taxpayers have told us loud and clear, time and time again, 'Live within your means. Don't come at us time and time again as you have the last few years.'" But Rep. Carl Williams (D-Saginaw) said the bill contains unacceptable sacrifices in the state's social safety net. "I do think that this whole bill says: 'I accept collateral damage. I accept that our children will be damaged. I accept that our old folks will be damaged. I accept that our security in this state will be damaged,'" he said. Debate was especially passionate as the committee discussed the welfare and Medicaid cuts. Under the bill, 15,000 welfare cases that have been receiving aid for more than four years would be cut off from assistance January 1. A new four-year limit would be set on receiving welfare, and the maximum monthly welfare check would be cut by $50. "Human dignity and compassion doesn't mean we should keep people in poverty for life," said Rep. Jerry Kooiman (R-Grand Rapids) in explaining his support of enforcing a limit on how long someone can stay on welfare. "It's just like someone who's an alcoholic. Sometimes you have to have limits to force people to do the things they have to do." Rep. Bruce Caswell (R-Hillsdale) pleaded with Democrats on the committee not to exaggerate what the bill would do. Accusations that the bill would kick children off of Medicaid simply are untrue, he said. "If I thought that for a minute, I wouldn't have done it," said the chair of the Appropriations Subcommittee on the Department of Community Health. "We are scaring the bejesus out of them (Medicaid recipients) that they're going to lose their health care for their children." Quietly, off microphone, Rep. Alma Wheeler Smith (D-Ypsilanti) responded, "They are." Rep. Chris Kolb (D-Ann Arbor) said the proposal to cut off 15,000 welfare cases - which he said total 47,877 mostly women and children - is appalling. The cases involve a parent with major barriers to finding work - a large family, mental illness or a physical disability. "Shame on us if we do it," he said. "Saying that 'having a hungry belly will motivate you to get a job' turns my stomach." At times over the last two days, rhetoric from Democrats and Republicans would seem to paint themselves into corners with no room for negotiation - the GOP adamantly opposed to Ms. Granholm's tax and fee increases and Democrats and the governor just as resistant to the Republican cuts. Rep. Gretchen Whitmer of East Lansing, the top Democrat on the House Appropriations Committee, said the two sides "are much further apart" than in the first two budget cycles since Ms. Granholm took office in 2003. But Ms. Whitmer also said there are areas on which the Democrats are willing to negotiate (she declined to specify) and noted comments from House Republicans that implied certain pieces of the budget bill - like the college scholarship cuts - were included as leverage for eventual talks with the governor. "Whether it's today or September 30, they're going to have to get in the room and hash out the details," she said. House Speaker Craig DeRoche (R-Novi) denied that House Republicans have taken an absolutist position on raising taxes and fees to fund the budget. Mr. DeRoche said the House GOP wanted to show Ms. Granholm that a budget could be constructed without new revenues, but he also suggested new revenues could be part of an eventual budget deal. "I don't think we've painted ourselves into a corner at all because the House has not said, 'It's our way or the highway,'" he said. "I would hope that we get as close to ... living within our current means as we possibly can through the process. If the governor wants to negotiate to raise taxes and fees in the state of Michigan, it's her prerogative to do that." HOUSE G.O.P. IN LOCKSTEP ON OMNIBUS BILL If any Republican has a reason to oppose the House GOP omnibus budget bill that contains major spending cuts across nearly all of state government, it's Rep. Tom Casperson. An Escanaba resident, Mr. Casperson represents three counties in the Upper Peninsula, which takes some of the steepest and least popular program cuts in the budget with aid to Northern Michigan University slashed and the Newberry Correctional Facility and prison Camp Manistique closed. And his district contains more Democratic-leaning voters than any other in the state held by a Republican - meaning this bill could jeopardize his re-election and endanger the GOP's 58-52 majority in the House, especially if he votes for it. But Mr. Casperson, while saying he is working feverishly to soften the reductions and acknowledging the cuts to U.P. institutions put him in peril, said Wednesday that he would vote for the omnibus budget bill when the House takes it up Thursday. As of Wednesday afternoon, there was no known internal House GOP opposition to the bill. Mr. Casperson said if he votes against the bill now before the budget is finalized and sent to the governor - something still a long ways off regardless of the House vote - he would have a more difficult time securing support from House GOP leadership to lessen the cuts. It would be easy to oppose the bill now, but doing so would not solve the budget problem. "I think if I stay with leadership, I can work these problems out," he said. "I'm concerned I'll lose that ability if I try to play politics." The second-term legislator said he thinks the cuts could be spread across the prison system instead of hitting Newberry so hard. And he criticized the cut to NMU as a "short-term" solution. The bill's cuts to U.P. institutions already have put him in political trouble, Mr. Casperson said. His office fielded 250 calls from residents urging his opposition to the bill from late Tuesday through Wednesday morning. Mr. Casperson is not alone among House Republicans who say they have serious qualms with some of the cuts in the bill, but will vote for it anyway. Rep. Shelley Taub (R-Bloomfield Hills) voiced strong displeasure with the funding level that the bill would set for the University of Michigan. Rep. Lorence Wenke (R-Richland) said he has "serious reservations" about cuts that would affect poor residents. Rep. John Stewart (R-Plymouth) expressed concern over cutting job creation services at the Michigan Economic Development Corporations. Rep. Roger Kahn (R-Saginaw Township) said he is alarmed about cuts to the juvenile justice system and in programs for children age 0-5 and would be willing to support amending the bill to improve those areas. But not one said they would oppose the bill when the full House votes. Indeed, Mr. Kahn, Mr. Stewart and Ms. Taub already cast a vote for the bill Wednesday as members of the House Appropriations Committee. Most noted, as Mr. Casperson did, that the budget process only truly begins once the governor, House and Senate each have proposed their respective versions of the budget. "I may very well vote for it the first time," Mr. Wenke said. "I want to get them (the governor and legislative leaders) started on negotiating their differences as soon as possible." Mr. Casperson cruised to a landslide re-election in 2004 thanks to both his own hard work and a lackluster Democratic opponent. But he clearly will be the test case on the political impact of the House Republican omnibus budget bill. Rep. Rich Brown (D-Bessemer), who represents the district to the west of Mr. Casperson's, said Mr. Casperson has to make his own decision about how to vote, but traditionally Upper Peninsula legislators stick together on U.P. issues regardless of party. While cautioning that the 2006 elections are far away, Mr. Brown said, "Any time a U.P. representative votes against U.P. interests, it resonates." HIGHER ED BUDGET PASSES SENATE APPROPS Following debate at times more primal than academic, a 2005-06 higher education budget that makes major cuts to two universities while boosting one by 22 percent went to the Senate floor from the Appropriations Committee. The often pained debate on SB 273 highlighted the committee's action as it sent seven budgets to the Senate floor. The committee also restored a revenue sharing cut in the general government budget (see related story) and approved the closure of three State Police posts that Governor Jennifer Granholm had proposed, but that Sen. Mike Prusi (D-Ishpeming) said the administration now wanted to stay open. But it was the allusions to past political godfathering and the current charges that SB 273 would cannibalize universities to help others that drew the greatest focus to the budgets reported on Wednesday. The higher education budget totals some $1.7 billion. Of the total, $1.56 billion is in general funds. The overall budget is $52 million more than the current year and $64 million more than Ms. Granholm recommended. The general fund portion is $8 million less than the current year, but again $64 million more than Ms. Granholm's proposal. Most of that difference over Ms. Granholm comes from restoration of $58.8 million to the Tuition Grant program for students at private colleges. That total is $3 million less that the current year, but the governor had for the second consecutive year proposed eliminating the program. The budget was approved 10-6, but it was not a party-line vote. Sen. Tom George (R-Portage) voted no and Sen. Jim Barcia (D-Bay City) voted yes. Of the 15 four-year universities in the state, 13 would receive funding increases (eight of those - Eastern Michigan University, Ferris State University, Lake Superior State University, Michigan State University, Michigan Technological University, University of Michigan-Flint, University of Michigan-Dearborn and Western Michigan University - getting increases of less than 1 percent). Oakland University would get an 8.8 percent increase, Saginaw Valley State University would get an 8.6 percent increase, Central Michigan would get a 2.7 percent increase and the University of Michigan would get a 1.7 percent increase. But the battle focused most on the 22 percent increase for Grand Valley and the cuts of 10 percent for Northern Michigan University and 5 percent for Wayne State University. In an effort to prevent the budget with its cuts and increases from being considered, Sen. Deborah Cherry (D-Burton) attempted to win approval of Ms. Granholm's original budget proposal, which she was a fairer budget than that of the subcommittee. The effort failed. Sen. Mike Goschka (R-Brant) said the budget was an effort to establish funding for the universities on the basis of policy and not politics. There was "no question" that funding discrepancies in the past were "glaring." Even with their cuts, Mr. Goschka said NMU and Wayne State would still be funded in line with their peer universities on a per student basis. Mr. Goschka even said he would have proposed cutting Northern Michigan by more except for his great respect for Mr. Prusi. On that basis, he kept the cut to 10 percent. Committee chair Sen. Shirley Johnson (R-Troy) said the budget was an example of a "godawful expression that what goes around, comes around." Talking about the late House Appropriations Committee Chair Dominic Jacobetti, Ms. Johnson said, "Lots of universities suffered" when he governed the appropriations process. "Two wrongs do not make a right," Ms. Johnson said, "and we all know this is going to change, but at least it is some recognition that those universities suffered." Even with the cuts proposed to NMU and Wayne, Mr. Goschka said many universities in the state would gladly take their level of funding in exchange for their own. But Mr. Prusi argued that going back as much as 26 years there is no evidence that NMU or Wayne were treated specially compared to other universities. Both serve students from areas with lower median incomes and to cut funding at this time would send a horrible message to the universities and to higher education. "If all we're going to is hack, slash, cut and burn then do it to everybody. Don't pick on two universities that serve the underserved," Mr. Prusi said. To cut these universities because of what either Mr. Jacobetti, who died in 1994, or former Rep. Morris Hood Jr., who died in 1998, did was "to dig these bodies up from the grave and punish them." But Sen. Alan Cropsey (R-DeWitt) said what the committee is attempting is not a new concept, and while it is not perfect it seeks to establish an overall policy on higher education funding.