Michigan Governor Signs $81 Billion Budget for 2026

News Summary

Governor Gretchen Whitmer has signed a bipartisan $81 billion budget for fiscal year 2026, focusing on road repairs, public safety, tax cuts, and healthcare investments. The budget allocates $2 billion for road repairs funded partly by a cannabis tax hike and includes substantial healthcare funding of $29.8 billion for Medicaid. Education will also see significant enhancements with a $21.3 billion package aimed at increasing per-pupil funding. Overall, the budget aims to improve essential services across Michigan.

LANSING, MICHIGAN – Governor Gretchen Whitmer has officially signed Michigan’s budget for the fiscal year 2026, totaling $81 billion. The budget was approved with bipartisan support from the Michigan Legislature and encompasses a general fund of $14.1 billion. This comprehensive budget addresses several pressing issues, including road repairs, public safety, and healthcare access.

The new budget allocates nearly $2 billion to be phased in over the next four years specifically for road repairs. To partially finance these improvements, a 24% tax hike on cannabis sales was approved, which is projected to generate $420 million annually. In addition, approximately $1.6 billion will be distributed to local governments through revenue sharing to bolster public safety and local services.

In support of working families, the budget extends previously enacted tax cuts for about 500,000 households, including the rollback of the retirement tax. Further, expansions were made to the state’s Earned Income Tax Credit, and state taxes on tips, overtime pay, and Social Security income have been eliminated.

The health care sector will see substantial investment, with $29.8 billion allocated for Medicaid and related programs. Additionally, the budget includes measures targeted at enhancing environmental and natural resource protections, aiming to safeguard air, lakes, and land.

The budget also focuses on improving government efficiency and modernizing technology, demonstrating a commitment to addressing essential “kitchen table” issues like costs, public safety, and healthcare access. The budget process leading to this agreement was marked by extensive negotiations, including a brief government shutdown.

House Speaker Matt Hall has emphasized the need for efficiency in state spending, aiming to eliminate waste, fraud, and abuse to provide better value to taxpayers. Governor Whitmer has highlighted that this budget reflects a commitment to help residents afford to live and thrive in Michigan.

Education will benefit significantly from the budget, which includes a $21.3 billion package raising per-pupil funding to $10,050. Increased funding is also designated for mental health and safety programs within schools, underscoring the administration’s focus on educational improvement.

Legislative leaders from both parties have commended the budget as a fair compromise that meets essential priorities while maintaining fiscal responsibility. This marks Governor Whitmer’s seventh balanced budget, a critical achievement amid uncertain conditions marked by fluctuating tariffs and a national government shutdown.

Overall, the budget aims to enhance essential services and support for residents, including boosting funding for first responders and core healthcare services that millions of Michiganders depend upon. As the budget takes effect, state officials and residents alike anticipate its impact on everyday life in Michigan.

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