Debate heats up over how Michigan's billion dollar surplus should be spent

By Jaclyn Kelley - jkelley@abc57.com
NILES, Mich. -- Michigan says it has a one billion dollar surplus in its revenue. Now there is a debate on how the money should be used after drastic cuts were approved earlier this year.
The state says some of the surplus came from extra revenue and money state agencies did not spend, but 500 million came from the school aid fund.

So, while school districts throughout Michigan were told they needed to make budget cuts and lay-off teachers, the state had extra money.

Right now several schools across Michigan are feeling the rippling effects of laying-off teachers, cutting school programs and, in some cases, are already working the process of closing their doors all together.With less money and fewer teachers for these schools, it means over-crowded classrooms and the absence of classes like art, which has Michigan parents asking how the state could let something like this happen to its schools.

"They had to know this money was coming. It just didn't happen over night," says Tim Reichanadter of Niles, Michigan.

"If they had not misplaced the money in the first place, the budget cuts would have not likely have happened. The money would be in the schools, where it should be," says Cynthia Moody.

Unfortunately, that is not how the state feels. In fact, the state plans on using the extra money to pay off its 1.5 billion dollar debt.

That has some outraged, mainly because 500 million dollars of this extra money came from the school aid fund, money legislators are already suppose to be giving to the schools.

The school aid fund was created back in the 90's so public schools would be funded by sales tax rather than by property taxes. 

The proposal was intended to lower property taxes to allow more people the opportunity to own a home. Legislators also approved the measure because some felt property owners were unfairly shouldering the burden of supporting local schools.

Now parents and members of the community feel they are getting the short in of the stick after hearing the state decision not to put some of the money back into the schools.

Since 2010 the state has borrowed millions of dollars from the school aid fund each year to help balance the budget, which has many people upset the state would not consider putting the borrowed money back into the fund, along with enough money to cover the latest cuts schools have had to make.

"The buildings need work, teachers are being laid-off. This is a great school and we need to save it. We need to pump some more money into it," says Reichanadter of the Brandywine School District in Niles, Michigan.