2007 House Bill 4850 / Public Act 18

Borrow to pay for current spending

Introduced in the House

May 24, 2007

Introduced by Rep. Virgil Smith (D-7)

To borrow $100 million dollars to avoid spending cuts in the Fiscal Year 2006-2007 state budget. The bill does this by increasing from $400 million to $500 million the borrowing authorized under the “<a href="http://www.michiganvotes.org/2005-HB-5047">21st Century Jobs Fund</a>” business subsidy program. The first $400 million of that debt was loans with a duration of approximately 20 years. Note: Reportedly, the bill may be amended to authorize an additional $300 million in borrowing to pay for current year spending.

Referred to the Committee on Appropriations

May 30, 2007

Reported without amendment

With the recommendation that the substitute (H-1) be adopted and that the bill then pass.

Substitute offered

To replace the previous version of the bill with one that increases the proposed borrowing from $100 million to $500 million.

The substitute passed by voice vote

Amendment offered by Reps. Daniel Acciavatti (R-32) and Daniel Acciavatti (R-32)

To authorize another $410 million in borrowing rather than another $500 million.

The amendment passed by voice vote

Amendment offered by Reps. Bruce Caswell (R-58) and Bruce Caswell (R-58)

To earmark $202.8 million of the proposed borrowing to cover school spending.

The amendment passed by voice vote

Passed in the House 80 to 26 (details)

To borrow $410 million to avoid spending cuts in the Fiscal Year 2006-2007 state budget. The bill does this by increasing from $400 million to $810 million the borrowing authorized under the “<a href="http://www.michiganvotes.org/2005-HB-5047">21st Century Jobs Fund</a>” business subsidy program. The first $400 million of that debt was loans with a duration of approximately 20 years. Note: Reportedly, the bill may be amended to authorize an additional $300 million in borrowing to pay for current year spending. The House Fiscal Agency notes that depending on the timing and structure of the borrowing this will impose annual debt service payments of $40 million to $46 million for the next 20 years.

Received in the Senate

May 31, 2007

Referred to the Committee on Appropriations

June 12, 2007

Amendment offered

To add an additional $5 million in long term debt to avoid cuts in current spending in the FY 2006-2007 budget. The extra borrowing was added after Gov. Granholm line-item vetoed a $5 million spending cut in the <a href="http://www.michiganvotes.org/2007-SB-436">budget bill</a> that embodied the deal based on this bill's borrowing.

The amendment passed by voice vote

Passed in the Senate 23 to 14 (details)

To borrow $415 million to avoid spending cuts in the Fiscal Year 2006-2007 state budget. The bill does this by increasing from $400 million to $815 million the borrowing authorized under the “<a href="http://www.michiganvotes.org/2005-HB-5047">21st Century Jobs Fund</a>” business subsidy program. The first $400 million of that debt was loans with a duration of approximately 20 years. The House Fiscal Agency estimates the measure will incur annual debt service payments of $40 million to $46 million for the next 20 years.

Received in the House

June 12, 2007

To concur with the Senate-passed version of the bill, which added an additional $5 million in long term debt to avoid cuts in current spending in the FY 2006-2007 budget.

Passed in the House 78 to 29 (details)

Signed by Gov. Jennifer Granholm

June 12, 2007