From education to infrastructure: What Michiganders can expect from $82.5B state budget
Michigan lawmakers recently passed the budget for the upcoming fiscal year, which starts Oct. 1.
Michigan lawmakers passed the state’s $82.5 billion 2025 fiscal year budget during an overnight session on June 27. The general omnibus and school aid budget bills now await Gov. Gretchen Whitmer’s signature.
Whitmer said in a statement following the early-morning vote that the investments contained in the new budget will set Michiganders up for future success.
“This budget will grow our economy, fix the damn roads, ensure first responders have the funding to keep our neighborhoods safe, and build a heck of a lot more affordable housing, while also bringing down costs and putting more money back in people’s pockets,” Whitmer said.
How will residents see the millions of dollars lawmakers allotted put to use? Here’s an overview of what to expect.
K-12 and higher education
Michigan’s Public School Employees’ Retirement System was a major discussion point during negotiations over the 2025 school aid budget. The upcoming budget is expected to put money back into classrooms by saving public schools $598 million in pension and retirement health care costs.
The Legislature included $200 million to continue providing universal free breakfast and lunch to all Michigan students, a move state officials say will help promote student learning and save families $850 per year. Universal school meal policies enhance food security and strengthen academic performance for children, according to health and education researchers.
Lawmakers expanded access to an additional 5,000 4-year-olds to the state’s free Great Start Readiness Program for preschoolers. Studies conducted by Michigan State University found that from 2022 to 2023, 90% of the approximately 38,000 children enrolled in the program came from low-income families, and that kids who have graduated from the program are better prepared and outperform their peers academically once they reach school age.
The universal meals and the free pre-K programs were both ushered in by Whitmer’s administration last year.
In higher education, the Legislature increased funding for the Michigan Achievement Scholarship, which is available to most Michigan high school graduates. The scholarship provides funds to cover tuition and some living expenses in amounts up to $5,500 a year for students at the state’s public universities and private colleges and up to $2,750 for community college students.
The other state-sponsored scholarship program, Michigan Reconnect, received $52 million to continue providing Michiganders free postsecondary education. The scholarship’s age requirement was temporarily lowered to 21 last year, but this fiscal year only those aged 25 or older will be eligible.
Economic development
The budget also contains funding to spur economic development and continue the Whitmer administration’s focus on growing Michigan’s population and attracting jobs. It includes building the state’s award-winning Pure Michigan tourism campaign, which has influenced millions to travel to Michigan and brought in billions in tourism dollars, and financial assistance to businesses locating to or expanding in Michigan.
The Legislature has allocated money to support entrepreneurs, including $10 million to support minority-owned businesses and $2.5 million in short-term loans.
The budget includes an additional $34.2 million in revenue sharing for cities, villages and townships, and a separate $30 million for counties. These additional funds will allow communities to improve public safety, fund recreation and overall boost the quality of life of residents, said Grand Rapids Mayor Rosalynn Bliss.
“These new resources represent a major milestone in the state’s effort to invest in thriving communities, and we must ensure that they are secure and can grow long term. Dedicated, predictable investment will help us protect our communities, allow us to compete for talent, and act as a catalyst for any economic growth strategy,” Bliss said in a statement, which was cosigned by a dozen other mayors of Michigan’s urban communities.
Infrastructure
Transportation and housing infrastructure throughout Michigan will receive much-needed upgrades too.
The 2025 fiscal year budget includes a combined total of $4.2 billion for road and bridge construction projects, according to the governor’s office, including $1.7 billion from President Joe Biden’s Infrastructure Investment and Jobs Act. State officials have been exploring ways to improve Michigan’s roads, particularly as the state plans to issue the last of $700 million bonds under Whitmer’s Rebuilding Michigan Plan later this year, but the roads are deteriorating faster than they can be fixed.
As Michigan attempts to grow its stock of affordable housing, $100 million has been set aside to build or rehabilitate houses in areas including Ingham County, Grand Traverse County, Muskegon, and Detroit.
Another $20 million appropriation was made to help unhoused individuals find employment and other supportive services that help them secure stable housing. Advocates say that the need for housing resources is dire across the state, and this funding will be a significant step toward solving homelessness.
“We are incredibly grateful to Michigan legislators for recognizing the critical role supportive services play in solving homelessness,” said Catherine Distelrath, Michigan director at CSH, founded as the Corporation for Supportive Housing, a national group that helped lobby for the funding. “This represents a powerful investment in our communities, equipping supportive housing providers with the resources needed to deploy services that can help people achieve lasting housing stability.”