Gov. Rick Snyder is ramping up to announcement of his proposals to improve Michigan's economic fortunes. But first, he has offered a stark look at state finances, with greater transparency than typical outlines from Lansing.
Snyder put forth a "Citizen's Guide to Michigan's Financial Health" — a simplified state balance sheet designed to show, in an easily understandable form, the state's finances.
The guide is designed to simplify the state's voluminous Comprehensive Annual Financial Report and provide greater transparency for Michigan's total financial condition — including the money that's coming in and going out, fund balances and outstanding obligations.
What citizens will see is a snapshot of spending and debt levels that exceed state tax revenue, unfunded pension and retiree health care obligations and a state "rainy day" fund that doesn't hold water.
Among the specifics: there is approximately $18.2 billion in unfunded state and local government pension obligations, encompassing $3.1 billion for the state, $3.1 billion for local governments and $12 billion for school districts; and a combined $40.2 billion in unfunded retiree health care obligations.
Some of Snyder's proposed solutions will become evident Feb. 17 when he presents his state budget and accompanying tax message. A centerpiece is Snyder's flat corporate income tax proposal that would eliminate deductions along with Michigan Economic Growth Authority tax credits -- a favorite vehicle for business investment incentives of former Gov. Jennifer Granholm.
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