What REALLY Happens With the State Budget Every Year?

I served in the legislature six years, until leaving under the state's term limits law. I learned a great deal about how government really works in the state. One of the things I learned is that the budget process really only involves five people: the governnor, the Speaker of the House, the Majority leader of the Senate, and the two minority leaders (House and Senate).

According to the Constitution, the governor proposes a budget and the legislature actually appropriates the money through an arduous and lengthy process. Eighteen budgets are deliberated over by both chambers of the legislature. In the end, there is a reconciliation between the House, Senate and Admnistration. But all of that process is window dressing. What really happens? It's called "targets."

Read this story by Kyle Melinn. He writes for the Lansing City Pulse and the MIRS newsletter. His somewhat cynical view of the process is in fact, very accurate. I can attest to that from first hand experience. I have copied the text below for those who don't want to link to the article.

Wednesday, July 22,2009

Don't Tell Anyone About Our Secret Government

by Kyle Melinn

From now until at least September, our state government leaders will be periodically locking themselves in a room at an unannounced time and place.

The public has no real idea what is being discussed “behind closed doors,” as Charlie Rich sings, other than the promise is that next year’s budget is getting smashed together. The daily spoonful fed to the media is that discussions “are ongoing,” somewhat like life itself, but we’re assuming much more painful.

Whoever steps into the room takes a Mason’s-like pledge of secrecy. Anyone with the gall to break that circle of trust by — gasp — talking to anyone but the Holy Father himself is shot at sunrise.

This deal-making process is called “targets.” Typically, the meetings include someone from the Governor’s Office or state Budget Office, sometimes the governor herself, the Senate majority leader, the speaker of the House, some other key lawmakers, plenty of paid staff or some combination thereof.

This “targets” fraternity process isn’t written into the Constitution or mentioned in state law.

And, yet, this is where state government discovers how much money it spends. On which programs the money will be spent. How much of that money will be spent on said programs. Which taxes and fees, if any, will be raised.

Pretty important stuff, really. And it’s all secret. Every last word.

What do these people talk about? What are the subjects that are truly “on the table?” What do all sides completely agree is “off the table?” The official answer: “Discussions are ongoing.” Until they cease to be ongoing, I suppose.

This year’s round of “targets” is particularly agitating to the few and the proud who prefer open government in Lansing. Myself included.

Typically, the governor puts out her budget plan in February. The House and Senate take the next four months to sniff it, bat it around and then, ultimately, gnaw on it before they, too, pass a budget that is remarkably similar but uniquely different than the governor’s. At that point they scurry into the “targets” room and, many weeks later, emerge with arms locked in a warm, wonderful embrace. They name the baby “Deal.”

This year, the governor proposed a budget in February and then watched state revenues drop off a cliff. President Barack Obama fed this state money as fast as Treasury could print it, but a lot of it is meant only for a social programming, energy efficiency and likeminded, well-intentioned programs. The hemorrhaging General Fund? Nope.

The House passed its budget, by and large, before anybody knew how bad the problem was, which left the Senate to pass something in June so hideous two senators fought about it in an elevator.

So now we’re allegedly in targets, but what is being targeted? The governor’s and the House’s public plans are outdated. Passing those budgets without tax increases would blow a hole in the state’s checkbook, and everybody knows it. They’re not seriously being discussed.

Gov. Jennifer Granholm is telling her favorite mass media reporters that she doesn’t like some of the Senate’s cuts, which she shouldn’t. But outside of making a vague reference to $500 million to $1 billion in “tax loophole” closings, she isn’t offering a counter-proposal.

Maybe she has one, but Granholm only talks over the phone to select, big-market reporters who don’t ask tough questions.

Does the House leadership have a plan? I’m sure Speaker Andy Dillon’s has a brilliant, novel approach to balance the budget. I’m not being sarcastic about that, either. It’s just that unless you can read his mind, you’ll never know what it is.

So we have secret meetings taking place at secret times on secret proposals that ultimately will become a secret, unalterable “deal” that any member of the majority is obliged to vote for.

Sounds like the creation of the Michigan Service Tax of two years ago!

The difference, of course, is that the Service Tax was the spawn of some new dark hole that recently opened up in the Capitol called the “work group,” the poor and lessexclusive cousin of “targets.” Hand-picked lawmakers, lobbyists and staff all jump into this “workgroup” abyss when there’s a real big problem chasing them, like a broken tax system, for example.

If all goes well, out pops a bill “everybody” allegedly agreed to. Any substantive changes are completely out of the question. Minor, “technical” changes can be fixed on the House floor, where amendments are never read, rarely explained and almost always jammed through under the dull, loud roar of 110 people talking sports, movies and family.

Hey, but at least the final vote on the final product is recorded for posterity. The Legislature will even record who voted how in its official journal, and why wouldn’t it? Would you expect anything less from an open American government?

(Kyle Melinn is the editor at the MIRS newsletter. His column runs weekly. Write melinn@lansingcitypulse.com.)