LANSING – Making it more likely that the tactic could be used to help balance the 2009-10 budget, a spokesperson for Gov. Jennifer Granholm said Thursday that she is open to using some School Aid Fund monies to help offset cuts in the general fund budget.

House Speaker Andy Dillon (D-Redford Twp.) also said he would look at the idea because otherwise general fund cuts to programs would be too deep.

Senate Republicans have discussed using some monies from the School Aid Fund to help offset cuts to community colleges and higher education that would otherwise be needed to keep the 2009-10 general fund budget balanced.

School Aid Funds can only be used for education purposes, but they could be used to offset general funds in both the higher education and community colleges budgets. Those funds could then be used to offset potential cuts in other programs.

House Fiscal Agency Executive Director Mitch Bean first suggested the idea a month ago when the revenue estimating conference established that the School Aid Fund would have more money than projected in January. The fund could be borrowed against with no negative effect to schools, he said.

At the time, Budget Director Bob Emerson said Granholm might be reluctant to use the funds to help the current budget.

But with the state compelled to close at least a $243.5 million general fund deficit for the current fiscal year, and with that to take priority over finishing the 2010-11 budget (and with lawmakers still saying they hoped to complete the 2010-11 budget by July) there is greater pressure to look at using the School Aid Fund to help resolve the deficit.

School groups have remained opposed to the idea.

While Senate Republicans have discussed using the fund, one caucus member said there is no final decision on the action, which would likely only come if leadership agreed to it.

Liz Boyd, Granholm’s spokesperson, said Granholm would only consider using the School Aid Fund if it was guaranteed there would be no cuts to K-12 schools.

Also, Boyd said use of the School Aid Fund would require that the budgets for both fiscal years be resolved.

It was important to get both years completed so the state knows the extent of the budget problem it faces, she said.

In his comments to reporters, Dillon said only that he would look at using the fund to help offset cuts that otherwise would be too deep.

He did not say he was committed to the idea, however.

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