Traverse City Record-Eagle

Michigan

January 12, 2014

5 things to know about the state Legislature in 2014

LANSING (AP) — The Michigan Legislature formally kicked off 2014 with no heavy lifting in week one. But voting could occur as soon as this week, when lawmakers also gather to hear Gov. Rick Snyder’s annual State of the State pep talk.

Five things to know about the session:

1. BUDGET, BUDGET, BUDGET

Thanks in part to an improved auto industry, legislators will have nearly $1 billion more to work with than expected when approving the state budget. They’re eager to finalize the spending plan around Memorial Day for the fourth straight year, a point of pride for majority Republicans after past financial crises. Priorities include setting aside more money for early childhood education and for road upkeep without permanently raising gasoline taxes or vehicle registration fees. One atypical budget topic: choosing a new state standardized test to align with national education standards being adopted in Michigan.

2. TAX-CUT TALK

Many in the GOP are talking up an election-year tax cut, though Snyder, a Republican seeking re-election, is being cautious. Gradually reducing the 4.25 percent state income tax to 3.9 percent, the level in 2007, would compound to a significant annual loss in revenue within five years. Yet lawmakers are confident they can cut taxes responsibly. A one-time rebate could be an option, too.

“The last thing I want to do is leave for my successors and their successors a problem like we walked into,” said Rep. Kevin Cotter, R-Mount Pleasant.

The tax talk could help Democrats’ efforts to remind voters of the move by Snyder and Republicans to slash business taxes and offset most of the cut with higher taxes on retirees, homeowners, low-wage earners and taxpayers with children. Republicans oppose Democratic calls to reinstate an exemption for pension income and to fully restore a credit for the working poor.

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