In the latest revenue estimating conference on May 15, Michigan’s revenues again fell short of predictions. In fact, the revenues for the current fiscal year are down more than 20% from FY 2007-2008 levels (almost $2 billion) due to “very weak economic activity” and the impact of some tax credits. For the same reasons, the estimates for revenues in FY 2009-2010 have been revised downward by almost $1 billion since the January, 2009 estimates. While federal stimulus money will plug some holes in the state budget for the time being, the state’s budget future after these resources are utilized looks very bleak.

This devastating economic news has thrown a wrench in the legislative budget process. Although the Governor’s proposed FY 2010 budget already included numerous significant cuts that affect older Michiganians, some of those cuts were restored by the House Appropriations Committee and were awaiting decisions by the Senate Appropriations Committee. After the revenue news was released, a scheduled Senate Appropriations hearing was cancelled and it appears a small group of legislative leaders are now considering how to deal with the continuing, and worsening, budget crisis.

Advocates are continuing to advocate for leadership from the Governor and the Legislature to solve the budget problems by increasing revenues instead of slashing costs. Advocates and others have proposed closing tax loopholes and a number of revenue enhancement measures that could address the enormous projected revenues in future years but these measures have not been widely endorsed by legislators.

Other cuts include 17 per cent of the 4th quarter for AAAs, for home delivered meals, for senior volunteer programs, and senior respite care,Michigab Protection and Advocacy got. 50 per cent cut in the remaining quarter. CMH non Medicaid funding was cut by $10 million and the line item for mental health initiatives for older persons including Alzheimers.