LANSING – It is unlikely the current year and 2004-05 budget will be resolved when the Legislature returns next week, but top lawmakers in the Michigan House and Senate hope that the Legislature will have made final decisions on an increase in the tax assessed on the three Detroit casinos. If the casino tax is increased from the current 18 percent to 24 percent, then final discussions on how to resolve the budget can take place.
The House has called for increasing the tax to 36 percent and deemed the Senate’s plan for a 6 percentage point hike insufficient. It’s unclear at this point how big an increase will be sought in final votes.
Senate Appropriations Chair Shirley Johnson (R-Troy) and a spokesperson for House Speaker Rick Johnson (R-LeRoy) said Gov. Jennifer Granholm has made it clear final discussions on the budget would be fruitless until the Legislature resolves the issue of the increase in the casino tax.
That increase would provide the final revenues the state can raise to help balance the budget, and with that, Johnson said the administration and Legislature would only be about $60 million apart in terms of cuts needed to complete the budget. That would mean the Legislature could complete action by about mid-August. The next fiscal year begins October 1.
Both the House and Senate are scheduled to come into session on Wednesday, August 4. The House has also scheduled session for Thursday and Friday, while the Senate has set tentative meetings for those days.
A major question remains whether the casino tax increase, in HB 4612, can pass the House without passage of the so-called racino bill, HB 4610, that would allow slot machines at horse race tracks. Racino supporters have indicated they want their bill to the governor first.
Last week, legislative Democrats and Senate Majority Leader Ken Sikkema (R-Wyoming) told Mr. Johnson they would not vote on the racino bill until after the November election when the voters will decide on a proposed constitutional amendment stipulating there can be no new gambling in Michigan without statewide voter approval.
Keith Ledbetter, spokesperson for Johnson, said that while the speaker is a prominent supporter of the racino bill, “he will not let the racino bill stand in the way of a balanced budget.”
Johnson’s highest priority is a balanced budget, Ledbetter said. However, Ledbetter also reiterated previous statements that other Republican racino supporters may withhold their votes on the casino tax until the racino issue is resolved.
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