Hollis Turnham
Michigan Policy Director
Paraprofessional Healthcare Institute
5013 Applewood Dr
Lansing, MI 48917
517-327-0331 (voice and fax)
hturnham@...

www.paraprofessional.org
www.directcareclearinghouse.org

*This message was transferred with a trial version of CommuniGate(tm) Pro*

----- Original Message -----
From: "Sharon Parks" -Michigan League for Human SErvices <sparks@...>


Sent: Tuesday, February 10, 2004 12:46 PM
Subject: Sign on letter regarding revenue solutions to the budget crisis


> Hello all. Attached is a letter that we would like to send to the
> Governor and the legislature TOMORROW with the names of as many
> organizations listed as possible. Would you get this letter out to as
> many organizations in your networks as possible.
>
> If organizations want to be listed we need an affirmative response and
> how the organization should be listed, NO LATER THAN 2 P.M. TOMORROW.
>
> If you get responses you can send them along to me or have people e-mail
> me directly or call our office. Thanks for your help.
> --
> Sharon Parks
> Senior Research Associate
> Michigan League for Human Services
> 1115 So. Pennsylvania Ave. Suite 202
> Lansing, MI 48912
> Phone: 517-487-5436
> Fax: 517-371-4546
> sparks@...
> www.milhs.org


> Dear Governor Granholm (Representative or Senator)


As the Fiscal Year 2004-2005 budget process begins we want to express our
very deep concern over the prospect of additional cuts in state spending in
order to address the state's worsening structural deficit.

Program reductions since 2001 now total over $2.5 billion and the adverse
impacts of these reductions are evident across the state. Thousands of
Michigan adults are without dental, podiatry, hearing and chiropractic
services previously covered by Medicaid. College tuition is higher as a
result of cuts in higher education. Senior centers and library programs
have been shut down and funding to local agencies has been cut. State
agencies are unable to deliver timely services, and necessary administrative
and fiscal oversight of state programs is in jeopardy. Now, you and the
legislature (Governor) must craft a budget that addresses an additional
revenue shortfall of nearly $1 billion.

We believe that additional spending reductions are not the answer to the
state's structural deficit. Since Fiscal Year 2000, Michigan's General Fund
revenues have declined by almost 30 percent when adjusted for inflation.
Unfortunately, the combination of spending reductions, one-time measures and
only modest revenue enhancements that have been utilized to date have failed
to reverse this trend.

Michigan cannot grow its way out of this fiscal crisis through an improved
economy. Enacted tax cuts have had a permanent effect on the state's
revenue generating capacity and even the significant growth predicted by
economists will not make up for the double-digit inflation in Medicaid and
Corrections costs and the loss of federal Medicaid funds.

In order to maintain critical state and local services and make necessary
investments in the state's future, it is imperative that revenue solutions
now be seriously considered in the budget process. Although the budget
solutions to date have included some revenue enhancements, they have been
very modest in relation to the size of the budget deficit. And, while it
appears that there may be additional recommendations for revenue increases,
these too, pale in comparison to the magnitude of the latest revenue
shortfall.

Solutions are available that can ensure an adequate and stable revenue base
in Michigan. We urge you to look seriously at all options. Many ideas have
already been raised, such as expanding the sales tax to certain services,
halting the July reduction in the income tax rate, decoupling from the
federal estate tax, adjusting the tax on beer and wine, and ensuring that
revenues captured through a Single Business Tax replacement are adequate and
fair.

Michigan is not a high tax state. According to The Tax Foundation, Michigan
's state and local tax burden as a percent of income is somewhat below the
national average and significantly below the Midwest average, with Michigan
ranking 29th among the states.

We believe that further program reductions are not sustainable if Michigan
is to remain a desirable state in which to live and a competitive state in
which to do business. We believe that we are now at a point in Michigan's
ongoing fiscal crisis that the only responsible solutions are revenue
solutions.









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