Whitmer signs emergency COVID-19 response bills, vetoes nearly $80M in other spending

Lansing — Gov. Gretchen Whitmer has signed spending bills that provide $150 million in additional funding for Michigan's response to the COVID-19 outbreak while making moves to limit other state expenses, including gutting aid for the Pure Michigan tourism program.

The governor also signed executive orders Monday that limit state spending amid the pandemic, including a freeze on state hiring.

In a joint statement, Whitmer and the leaders of the Legislature announced Monday the signing of the two bills that boost the state's efforts to combat the coronavirus. But Whitmer and Republican leaders House Speaker Lee Chatfield of Levering and Senate Majority Leader Mike Shirkey of Clarklake also said nearly $80 million in other General Fund expenditures in one of the bills that was unrelated to the virus had been vetoed.

Both branches of government agreed to the vetoes "so that funding could be re-prioritized for COVID-19," according to a press release from the state's leaders.

The vetoes struck $16 million for the Pure Michigan tourism campaign and $37 million for 85 special projects across the state, said Amber McCann, spokeswoman for the Senate Republicans. The state's tourism campaign effectively would be shuttered again after its $37.5 million in annual funding was vetoed by the Democratic governor during a fall 2019 budget fight with legislative Republican leaders.

“Now is not the time to sign a bill for supplemental funding for anything other than dollars that can be utilized to help our COVID-19 response,” Whitmer said during a Monday press conference.

One executive order temporarily restricts discretionary spending by state departments and agencies, according to the governor's office. The other temporarily freezes hiring, creating new positions, filling vacant positions, transfers and promotions within the executive branch of state government, according to the office.

Because of the severe economic impact of the COVID-19 outbreak, there is a potential for a "significant loss in revenue," Whitmer said Monday of the state's finances.

The state is looking at a "wide range of scenarios that could translate to $1 billion to $3 billion in lost revenue, said Kurt Weiss, spokesman for the State Budget Office.

"As we get more information about unemployment, the economic impacts, the ability to use federal dollars, and what all of this means for tax collections and state revenues, we will then be better able to determine what budget actions will be necessary," Weiss said.

The first supplemental spending bill, which included $25 million in coronavirus emergency aid, passed the Legislature on March 12. The bill was approved before confirmed COVID-19 cases began spreading rapidly across Michigan and didn't focus on the virus that has blasted the state's economy.

For example, the bill featured $37 million for so-called "enhancement grants," providing funding for 85 projects across the state. Critics of the legislation labeled the grants "pork" and said they were lawmakers' "pet projects."

They included $500,000 for an elevator replacement for the Detroit Symphony Orchestra, $1 million for the North American International Auto Show and $250,000 for a gathering of state lawmakers from around the Midwest.

McCann, the Senate GOP spokeswoman, said the agreed-to vetoes eliminated all special projects in the supplemental and funding for programs like Pure Michigan.

In addition to the COVID-19 funding, the bill still includes $7 million in General Fund spending for a Medicaid rate increase for hospitals, $31 million for legal settlements involving the state and $14 million to reimburse local governments for the cost of conducting the presidential primary election.

The day the first spending bill passed the Senate, Michigan reported having only 16 confirmed cases of coronavirus. As of Sunday — 17 days later — Michigan had 5,486 confirmed cases.

Five days after approving the initial spending bill, lawmakers returned and passed another bill focused on COVID-19 emergency relief. The second bill featured $125 million to boost the state's efforts to combat the virus.

Of the dollars, $50 million will go to  "health care capacity" and will be distributed to health care providers in the state to expand capacity to deal with the virus.

Another $40 million will go to general state efforts to combat the virus, with focuses on monitoring, laboratory testing, contact tracing, infection control and continuation of critical state government functions. The previous spending bill included $10 million these initiatives as well. And $35 million will be set aside for the Legislature to appropriate or transfer to needs later. The Legislature had previously set aside another $15 million.

The joint statement from Whitmer, Chatfield, Shirkey, House Minority Leader Christine Greig, D-Farmington Hills, and Senate Minority Leader Jim Ananich, D-Flint, said the new dollars would bolster the state's response to the coronavirus.

"The additional funding provided today, along with the supplies and funding provided by the federal government, helps ensure that Michigan has the necessary resources to save lives and slow the spread of COVID-19," their statement said.

cmauger@detroitnews.com