Whitmer orders state hiring freeze, spending curbs, in coronavirus fight

LANSING – Michigan Gov. Gretchen Whitmer ordered a hiring freeze and put new reins on discretionary spending Monday as her administration grapples with how to meet increasing demands for state government services while tax revenues are expected to drop amid the coronavirus pandemic.

Whitmer also signed supplemental spending bills to increase spending on the COVID-19 crisis by $150 million, while using her line-item veto powers to delete $80 million in proposed spending items not related to fighting the pandemic. The vetoes were agreed to by legislative leaders from both parties.

Unlike the federal government, the state must balance its budget each year, meaning extra spending demands must be largely offset by cuts, borrowing or shifts in funding.

"Now is not a time to sign a supplemental budget for anything other" than items related to the virus, she said.

Among the exceptions to the freeze on hiring and promotions: cases where the "creation of a position or the filling of a vacant position is part of COVID-19 response activities necessary to address the emergency."

Whitmer, in a news release about the newly issued executive directives, thanked state employees "working around the clock to protect our communities from the spread of COVID-19."

Other new restrictions apply to nonessential contracts, purchases, travel, training and other forms of discretionary expenditures.

"We are doing our part," Whitmer said at a Monday news conference.

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More: Michigan death toll ticks up as Whitmer says more aid needed

State budget officials have provided few details about the expected impact of coronavirus and the stay-home order on state tax revenues, but the crisis is expected to hurt the state's two major sources of state revenue — income taxes, including both personal and corporate, and sales taxes — as well as other revenue sources.

Whitmer said she and Republican and Democratic legislative leaders have "a healthy respect" for the budget challenges Michigan will face and understand there will be an impact on the economy and state revenues.

"We're going to continue to work together to meet these challenges," she said.

The negotiated vetoes totaled $80 million from the general fund, or $167 million in gross spending when matching federal funds or money from state restricted funds is included. The vetoes, in gross spending terms, include:

$37 million for a range of enhancement projects around the state, some of which had been viewed as pork barrel spending

$35 million for the Michigan Reconnect program to help adults over 25 get a tuition-free path to a certificate or associate degree

$16 million to restore funding for the Pure Michigan tourism promotion and branding campaign

$15 million for the Going Pro campaign to match Michigan workers with needed skills

$11.3 million to replace a problem-plagued computer system used for child protective services in the Department of Health and Human Services

Whitmer and the four legislative leaders from both parties said in a joint statement that Michigan has already spent more than $130 million to secure more than 20 million masks, more than 2,000 ventilators, nearly 9 million ounces of hand sanitizer, more than 255,000 boxes of gloves, 2.4 million gowns, more than 2,000 beds, 210,000 testing supplies, 3,000 thermometers, 185,000 face shields, 22,000 cartons of disinfecting wipes, as well as other needed supplies.

“Residents across the great state of Michigan need to know that the executive and legislative branches of state government are working together to do whatever is necessary to ensure an effective response to COVID-19," said the joint statement from Whitmer, House Speaker Lee Chatfield, R-Levering, Senate Majority Leader Mike Shirkey, R-Clarklake, House Minority Leader Christine Greig, D-Farmington Hills, and Senate Minority Leader Jim Ananich, D-Flint.

"Today’s signing of two supplemental budget bills will provide new state funding of $150 million to bolster response efforts. 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.”

Contact Paul Egan: 517-372-8660 or pegan@freepress.com. Follow him on Twitter @paulegan4. Read more on Michigan politics and sign up for our elections newsletter.