Friday, June 1, 2012

Michigan Gov. Rick Snyder is working on strategies for when the good economic times return to state

MACKINAC ISLAND (Detroit Free Press) — Gov. Rick Snyder called for better government management and long-term planning in Michigan in his keynote address Thursday to the Mackinac Policy Conference. He also revealed how long-term, telling business leaders he's already working on state budgets as far out as 2050.

In a keynote address on the closing day of the Detroit Regional Chamber's annual island gathering, Snyder -- a CPA before he got into venture capitalism and, later, politics -- compared the state's billions of dollars in long-term liabilities to a home mortgage.

Once a mortgage is paid off, "you feel so much more confident that you don't have that liability anymore," Snyder told business leaders at the Grand Hotel.

Once the state's liabilities for long-term costs such as retirement health care are fully funded, the surplus cash flow that will result can be used to cut taxes or invest in programs, Snyder said.

That's why Snyder said he already has Budget Director John Nixon doing preliminary work on budgets in the 2030-2050 time range. Snyder has said he will seek a second four-year term in 2014 but will not be able to seek a third term because of term limits.

His speech was warmly received, though Michigan Democratic Party Chairman Mark Brewer, who attended the conference, criticized it for lacking substance.

Snyder "governs like an accountant, as if numbers were the only thing important to him," Brewer said.

"He represents 10 million people who have serious problems," Brewer said.

Snyder said many Michigan residents have reacted negatively to his view that the state needs to raise more money to spend on roads, viewing it as a tax increase.

"We have this warped view of how government works," Snyder said.

He compared the need to invest $1 billion-$1.5 billion a year in roads to the need for oil changes and other regular maintenance on automobiles. The investment will save Michigan money in the long term, he said.

Snyder has floated the idea of increased vehicle registration fees or increased fuel taxes but has not yet backed a specific proposal to raise an extra $1 billion a year or more to invest in roads.

This fall, Snyder said he will deliver a special message linking an energy strategy with an environmental strategy.

Michigan owns about 4 million acres of land but has no accompanying plan, he said.

"We should have a strategy as to why we own 4 million acres of land, what it means, where it's going, and why," the governor said.

Snyder has been criticized for reducing business taxes by about $1.8 billion while increasing taxes on pensions and cutting money for schools and reducing tax credits for poor people in his 2011 budget. But the state's unemployment rate also has dropped by two full percentage points in the last year and the automotive industry is on a strong rebound.

Snyder said Michigan's improved fortunes have sparked a negative reaction among states that compete with Michigan.

When the state's economy was a wreck, "they didn't care about us," he said. "Now they're actually saying bad things about us, saying we're all messed up. I view that as good progress."

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