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Michigan projects ‘staggering’ drop in tax revenues

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Posted at 2:09 PM, May 15, 2020
and last updated 2020-05-15 14:09:10-04

LANSING, Mich. — Michigan will confront multibillion-dollar declines in tax revenue combined with record-high enrollment in government health insurance programs — a double whammy from the coronavirus pandemic that may lead to major service cuts.

Legislative experts and top officials in Gov. Gretchen Whitmer’s administration agreed to revise budget estimates Friday after hearing economic forecasts. The steep downward revision from revenue estimates issued just four months ago — nearly $6.3 billion combined this fiscal year and next — was unprecedented.

Revenues in the school aid and general funds, the state’s two main accounts, are projected this fiscal year to fall nearly $3 billion, 12%, from last year’s levels. The outlook is dire for the next budget, too, with revenues in the major funds coming in $2.2 billion, 9%, below 2018-19 collections.

“These numbers are staggering,” said Mary Ann Cleary, director of the nonpartisan House Fiscal Agency.

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