There are many wins in Michigan’s budget, but long-term investments are needed

Michigan Capitol | Susan J. Demas graphic

Every night, my family eats dinner together around the kitchen table and we talk about our day. It’s the place where we discuss the many things that impact our lives — our jobs, school, our health, where we live, our household budget and so much more.

These are the kinds of things that are undoubtedly talked about in countless homes across Michigan and we often hear lawmakers lauding the budgets they have worked on for addressing these types of “kitchen-table” issues.

In the case of the Michigan Legislature’s most recent state budget agreement , that sentiment certainly rings at least somewhat true. Building off the success of the current year budget, the Fiscal Year 2025 budget agreement includes many strong investments in what Michiganders need most, including long-overdue improvements to our state’s basic cash assistance program, the continuation of universal free school meals, improved access to healthcare, expansion of the Rx Kids program and additional funding for childcare.

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Here at the Michigan League for Public Policy, we are celebrating these budget wins, especially the transformational improvements to the Family Independence Program (FIP), which will go a long way toward providing meaningful cash assistance to families struggling to make ends meet.

We have long advocated for FIP to be strengthened by shifting more Temporary Assistance for Needy Families (TANF) funding to this program and we are pleased to see that it is finally happening. After well over a decade without any improvements, the upcoming fiscal year’s budget will use an additional $62.5 million in TANF funding to address FIP’s woefully outdated payment standard, extend lifetime limits and provide extra funding to families with children ages 0 to 14.

While the improvements to FIP and many of the other people-centered investments in the FY 2025 state budget agreement are cause for celebration, it remains critical to not lose momentum in the coming years, especially with the end of pandemic-era funding.

It’s going to take bold, long-term investments to ensure brighter futures for families in our state, and we have a long way to go given that almost half – 41% – of Michigan households either earn below the Federal Poverty Level or are Asset Limited, Income Constrained, Employed (ALICE) , meaning they aren’t in poverty, but they still don’t earn enough to afford basic household necessities .

Michigan currently has the 13th highest poverty rate in the country at 13% and, sadly, our child poverty rate is even higher at 18%, while 28% are ALICE households. For all of these households, everyday life comes with impossible choices – from grappling with whether to pay rent or buy groceries to deciding between paying for childcare or keeping the lights on at home.

With the recent release of the national 2024 Kids Count Data Book from the Annie E. Casey Foundation, we also recently learned that our state continues to rank in the bottom half of states for overall child well-being at 34th and in the bottom 10 states for education at 41st.

While the pandemic played a part in some of the opportunity gaps we see in our education data, it is certainly not the only cause. Michigan continues to rank low among all 50 states that experienced the pandemic and, according to the Casey Foundation, test scores across the nation have hardly budged in decades.

Given our sobering education data, we were disappointed to see that more funding was not allocated to the school foundation allowance and mental health services for students in the FY 2025 state budget agreement.

However, we applaud the continued investment in school funding weights, as improving equity in school funding is necessary to ensure that every student’s needs are fully met. Still, we must do more to improve the educational outcomes and emotional well-being of our kids so they can thrive in their classrooms. That will be critical to not only their future success, but the future success of our state as we look to keep people here and attract more people to Michigan.

These are issues that we can’t solve overnight, which is why long-term state investments are critical and why we will carry on in our advocacy of budget priorities that continue to be left out, including, but not limited to: a state Child Tax Credit , an expansion of EITC to workers who currently don’t receive it , and school funding that fully meets the needs of students .

Fighting for brighter futures for our fellow Michiganders is the cornerstone of our work here at the League and we will continue to fight until all people in our state have what they need to not only survive, but thrive.

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