Sen. Cassis introduces bill requiring budget stabilization fund balance to trigger the state Earned Income Tax Credit
Thursday, July 26, 2007
State Sen. Nancy Cassis today introduced a bill requiring that Michigan's Budget Stabilization Fund have a balance of $250 million before the state's new Earned Income Tax Credit would go into effect.
"This bill is part of a much larger reform effort to stabilize Michigan's economy at a critical time in our history," said Cassis, R-Novi. "I joined my Republican colleagues in negotiating a new business tax focusing on creating jobs and helping small businesses grow and prosper. Additionally, I am hoping to open debate on making Michigan a right-to-work state and on exempting public projects from prevailing wage mandates."
Cassis said there is a lot of talk about doing reforms but real action lags behind.
"I'd like to remedy this lethargy by looking at ways to boost our economic future positively and constructively," Cassis said. "While I am a strong advocate for the EITC, I question how responsible it would be to remove $132 million from the general fund when the budget faces a potential $1.8 billion shortfall. It is challenging to balance the state budget without raising taxes on working families but we must make some difficult choices. I believe the adverse effects of a tax increase would more than offset the positive contributions of the state EITC on our economy."
Michigan's version of the Earned Income Tax Credit was passed and signed in 2006, but does not take effect until 2008. Senate Bill 662 would require a budget stabilization fund balance be met as a trigger for the EITC to become effective.
The measure has been referred to the Senate Finance Committee.








