(Source: MIRS.news, Published 01/07/2025) Money is pouring into state coffers at a much higher rate than the state's bean counters projected back in May, according to the Senate Fiscal Agency’s Economic Outlook Report and Budget Review. 

With the final Consensus Revenue Estimating Conference (CREC) numbers coming Friday, the SFA says its numbers show the state closing Fiscal Year (FY) 2024 on Sept. 30 with $926.3 million more than expected in its General Fund (GF) and School Aid Fund (SAF) combined. 

For FY 2025, which started Oct. 1, the Governor and state lawmakers have $1.2 billion more than they thought due to revenue increases basically everywhere – income taxes, sales taxes, business taxes, insurance taxes. Basically everything but cigarette taxes and Lottery revenues.  

The better numbers keep getting better. The FY 2026 budget, which the Governor and lawmakers will begin working on later this year, was padded with another $1.1 billion projected in the plus column. 

Michigan Democratic Party Chair Lavora Barnes said the new projections "prove that Democrats are building a future here in Michigan where we can grow the economy, run a fiscally responsible government, and take care of our communities at the same time.” 

She made the argument that, under the Democratic-controlled trifecta, the state balanced its budget while expanding healthcare, offering free lunch and breakfast to public school students, investing in infrastructure, while $1 billion more than expected is projected to come in the door. 

Jase Bolger, the former Republican House speaker who has done work for the West Michigan Policy Forum, made two points: 

 - That handing out less money in “corporate welfare” equals more available money for “better taxpayer priorities . . . who would guessed.” 

 - All of these surpluses could have been steered to help fix Michigan's roads, as has been suggested by House Republican majorities for years. 

For FY ‘24, GF and SAF revenue totaled $32.7 billion, a 2.6% increase from FY ’23. 

The 2024 GF came out to $14.6 billion, an increase of 4.7%, or $658.6 million from the previous fiscal year. The updated preliminary GF estimate was $676.4 million higher than the initial May 2024 estimate. 

As for the SAF, the revenue totaled an estimated $18 billion in 2024, a 1%, or $173.5 million bump from FY '23, attributed to the growth in SET and gaming revenue. The SAF’s revised estimate is a total of $249.9 million higher than the May 2024 estimate.   

Compared to the previous fiscal year, Michigan's personal income rose by 4.9%, employment saw an increase of 0.8% and wage and salary income increased 5.6%. The report expects Michigan’s economic growth to essentially mirror the economic growth of the United States: a slowing of the employment rate, accompanied by an increase in the unemployment rate.   

Consumer spending is expected to slow in both the country and the state and uncertainty over changes in federal budget policy may cause a slowing of investments and the rate at which inflation will “return to normal,” according to the report.