In a Nutshell
- After an arduous budget cycle, the Michigan Legislature finally completed work on the state’s FY2026 budget in the early morning hours of October 3, avoiding a shutdown of state government operations.
- The budget agreement will eventually generate $2 billion in new annual road funding. It also implemented legislation to mitigate much of the anticipated $1.1 billion hit to the FY2026 budget arising from the enactment of the federal OBBBA.
- To their credit, lawmakers approved a structurally balanced budget free of gimmicks that would have pushed off real decision-making on needed cuts. However, future cost pressures tied to OBBBA changes in the financing of Medicaid and food assistance leave little room for growth in the GF/GP budget over the next several years.
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