What The Experts Say About

What the experts say about Michigan’s revenue system

August 19, 2009

42 days to new budget

Spending gap: $700 million and growing

Tom Clay

"The state budget, if anything, could use a tax increase rather than cutting taxes anymore. With the cuts to schools and especially higher education, an overall tax cut isn’t something that’s justifiable."

Tom Clay, retired director of state affairs of the nonpartisan Citizens Research Council of Michigan and former deputy state treasurer under Gov. John Engler.

Center for Michigan online article 8/6/09

Gary Olson

"The [state's] tax base, especially the sales tax, is not growing with the economy at all. That's going to have to be addressed, sooner or later, by the Legislature…. there is a fundamental disconnect with how revenues grows compared to the growth of income.“

Gary Olson, executive director of nonpartisan Senate Fiscal Agency MIRS, 7/31/09

With the state expected to be $9 billion below its constitutional revenue limit in 2010, it's increasingly clear the state's revenue system "is getting so out of whack with our economy. It's disturbing to me we are falling so far behind."

He said the situation will lead lawmakers to question "what we tax and what we don't tax."

Gary Olson, executive director of nonpartisan Senate Fiscal Agency Gongwer 5/15/09

"There is a problem balancing the budget because our tax system isn't responding to the economy. Several of our major taxes are not growing as fast as the economy."

Gary Olson, director of the nonpartisan Michigan Senate Fiscal Agency 8/19/09 Grand Rapids Press

Mitch Bean

“Are you going to cut back scholarships, State Police, revenue sharing? To make a budget without more revenue, you’re going to have to.’’

Mitchell Bean, director of nonpartisan Michigan House Fiscal Agency Detroit Free Press, 6/14/09

(Mitch) Bean said he’s concurred for some time with the sentiments of Senate Fiscal Agency Director Gary Olson, who said two weeks ago that a structural change to the state’s tax system is in order.

MIRS, 8/12/09

Bipartisan Emergency Financial Panel

A convergence of forces has brought about the most serious financial crisis in many years for Michigan’s state and local governments. This is a structural challenge, not simply the result of an economic downturn.

Emergency Financial Panel chaired by former Govs. James Blanchard and William Milliken

February 2007

A persistently weak economy, tax cuts, spending pressures, and inattention to essential government reform have triggered the crisis.

Emergency Financial Panel February 2007

We will not economically grow our way out of it. We cannot solely cut or tax our way out of it.


Fundamentally, Michigan must reform its spending and taxing and must reinvent the way state and local governments deliver services to be more efficient and productive. Government must demonstrate value for every dollar spent.


Our people and communities face economic hardship. That is why our state must make major investments to compete for the jobs of the 21st century and make Michigan a place where we want to live.


As policy makers seek ways of handling perilous gaps between resources and demands during this and upcoming fiscal years, we urge them to tackle long-term reforms in taxing, spending, and delivering public services.


The depth and breadth of this crisis—and the fundamental need for investment—demand a comprehensive response. The state must restructure taxes in a manner that would immediately increase revenues.


News & Politics

What The Experts Say About