Michigan Lawmakers Pass $1.6 Billion Continuation Budget

News Summary

Michigan lawmakers approved a $1.6 billion continuation budget to fund state operations for one week as they work on the full budget for fiscal year 2026. Governor Whitmer signed the bill shortly after it passed with overwhelming support in both the House and Senate. The continuation budget ensures state employees will continue to receive pay despite a budget lapse. Concerns over potential cuts to municipal funding have been expressed as negotiations for the final budget, which may include significant spending cuts, continue amidst pressures related to tax proposals.

LANSING, MICHIGAN – Michigan lawmakers successfully passed a nearly $1.6 billion continuation budget as the state government commenced the 2026 fiscal year on October 1 without a finalized budget. Governor Gretchen Whitmer stated that despite the budget lapse, there was no partial state government shutdown. The continuation budget is designed to fund state operations for one week while lawmakers continue discussions on the full budget.

The Michigan Senate voted 31-2 in favor of House Bill 4161, which was swiftly followed by the Michigan House voting 103-4 to approve the same bill. Governor Whitmer signed the continuation budget into law shortly after 4 a.m., resulting in a brief four-hour lapse in budget authority. This legislative action coincided with a federal government shutdown that began on the same day.

Work on the complete 2026 state budget resumed at the Capitol shortly after the approval of the continuation budget. However, many details regarding the proposed final budget remain undisclosed. Article 9, Section 17 of the Michigan Constitution specifies that state funds can only be spent according to appropriated laws. Nevertheless, both Governor Whitmer and legislative leaders assured that state operations would continue without interruption, citing the governor’s executive powers as justification for the ability to function without immediate appropriations.

The continuation budget allows state employees to continue working and receiving pay while the final budget is being negotiated. According to representatives, there are options available beyond the continuation budget, and it was deemed necessary to ensure fiscal stability during this interim period. The state is considered financially stable enough to avoid prolonged shutdowns.

Despite the continuation of operations, concerns about potential cuts to municipal funding have been raised by local officials as budget discussions unfold. Additionally, the final budget is anticipated to include significant spending cuts, projected to be around $800 million compared to the previous year’s budget. Lawmakers are also considering alterations to a proposed 24% wholesale tax on marijuana, aimed at generating $1.5 billion to repair roads.

Whitmer’s administration has also committed to a program providing universal free breakfasts and lunches in K-12 schools, which will continue into 2026. This initiative is part of a broader effort to support education and families across Michigan.

The last comparable partial shutdown experienced in Michigan occurred in 2009 and lasted about two hours. Governor Whitmer emphasized the state’s intent to maintain seamless government services while the budget is finalized, and a joint statement from her office along with legislative leaders reinforced this commitment.

Looking forward, a final budget vote within the House and Senate is anticipated on October 2. As the discussions progress, it is crucial for lawmakers to balance the need for necessary services against the backdrop of the state’s fiscal responsibilities, ensuring that essential funding continues amid ongoing debates and potential public protests related to the marijuana tax.

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