LANSING – Gov. Jennifer Granholm is prepared to “assert her constitutional authority,” administration sources said Thursday, and while no one would say the governor would outright veto an agreement cutting the 2009-10 general fund budget by $1.2 billion, they did say the agreement is not likely to take effect in its current form.

Officials said if the Legislature moves ahead with the budget agreement reached by Senate Majority Leader Mike Bishop (R-Rochester) and House Speaker Andy Dillon (D-Redford Twp.) then they would expect to see either a continuation budget take place on October 1, or so many line item vetoes that the proposal would be unrecognizable.

If the second scenario took place, under this thinking, legislative Republicans would be forced to come back to the negotiating table to restore a variety of programs they support by reaching agreement on reducing the impact of the cuts in the agreement.

While the speculation among many observers is that Granholm would sign the budget, or at least not veto it, in order to prevent a shutdown of state government, aides say she is not wavering from her belief that the budget would hurt the state in the long term.

She emphasized that herself on Thursday speaking to some reporters, saying, “The cuts that the Republicans have adopted, which they fully support, are not cuts that I support, because they hurt Michigan.”

And she openly questioned whether the suggestion that legislators would come back at the start of the 2009-10 fiscal year and pass revenue increases would take place. “Where’s the leverage to ensure that that happens? Once you sign off on something like that, then there’s no guarantee that the next step will happen.”

Granholm also issued a statement praising Senate Democrats for their budget proposals and again saying an “all cuts budget goes too far.”

The same question is being asked among Republicans, especially Senate Republicans. While it is likely some Senate Republicans would be willing to adopt tax changes to boost revenues (particularly reducing the size of some tax credits), several Senate Republican sources have said other members are pushing intently for no revenue increases.

The sources said that Granholm has had many conversations with Dillon about the course he is taking with Bishop and that his message is essentially, “trust me.” But the administration is still unclear about what exactly Dillon is attempting to accomplish with the budget proposal.

Told that many observers have dismissed Granholm as having no backbone to stop the agreement, sources said Granholm has said to staff several times, “I’m not running for anything,” and is not worried about the political pressure.

The sources also said there is still time to avoid a major confrontation between the two branches of government. But for a new agreement to take place practically sources believe it must occur before the state Republican meeting on Mackinac Island beginning September 25.

This story was provided by Gongwer News Service. To subscribe, click on Gongwer.Com

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