Buoyed by her first in-person State of the Union address in three years and delivering it to the first Democratic Legislature in 40 years, Gov. Gretchen Whitmer delivered her vision of a state she said is “strong.”
Speaking from the podium in the state Capitol for the first time since 2020 – the COVID-19 pandemic wiped out the in-person addresses in 2021 and 2022 – Whitmer laid out her priorities in a speech that lasted a little more than 45 minutes.
She laid out her plans to tackle the challenges Michiganders are facing right now. She said her proposals will lower costs, make Michigan more competitive, expand opportunity, and protect people’s fundamental rights. Together, they represent the future and will move Michigan forward.
Whitmer renewed her desire to roll back the retirement tax that ended exemptions for income from pensions. She also called on lawmakers to expand Michigan’s Earned Income Tax Credit, a tax benefit for low-income workers that is currently one of the least generous in the country.
Her Lowering MI Costs plan would repeal the retirement tax, boost the Working Families Tax Credit, and deliver pre-K for every child in Michigan. Repealing the retirement tax would save 500,000 households an average of $1,000 a year. Boosting the Working Families Tax Credit would deliver a combined $3,000 refund to 700,000 working families, directly benefitting 45% of the kids in Michigan. Delivering pre-K for all would save families $10,000 a year and put all 110,000 4-year-olds in Michigan on a path to a brighter future.
Lawmakers on both sides of the aisle have proposed legislation that would increase the EITC from 6% to 20% of the federal credit as proposed in House bills and 30% in a Senate plan.
“In 2011, seniors and hardworking families had the rug ripped out from under them when the retirement tax was enacted and the Working Families Tax Credit was gutted,” she said, referring to Michigan’s EITC. “It was wrong. Now, we can make it right.”
State Sen. Aric Nesbitt, a Republican from Porter Township, said his party is “ready to work with the governor” on tax relief for Michiganders, but said Whitmer has repeatedly vetoed bipartisan proposals to provide “real relief” for those in need.
“It is good to see some Democrats joining Senate and House Republicans in the call for immediate relief now for all Michigan families and seniors,” Nesbitt said in delivering the Republican response to Whitmer’s address. “We hope the governor will realize that she was wrong and finally be a part of bipartisan efforts to deliver that relief. Immediate tax relief for all Michiganders must be a priority in 2023.”
Whitmer also proposed the Make it in Michigan package, a sustainable funding source for Michigan’s bipartisan economic development fund to invest more in bringing new jobs for Michiganders. With this funding, Michigan can power economic development efforts year-round, move faster to compete for companies on the cutting-edge of manufacturing, and bring more supply chains home. Getting this done will create long-term economic opportunity in building cars, chips, and clean energy in our state and help ensure young people deciding where to start their lives choose Michigan.
John Walsh, president and CEO of the Michigan Manufacturers Association, said he “appreciates” Whitmer’s “frecognition of the need” to attract, nurture and maintain manufacturing investments in Michigan.
“Manufacturing is in Michigan’s DNA but we must effectively compete to ensure further industry investment to maintain Michigan’s position as the manufacturing state,” Walsh said. “With looming uncertainty in the global economy caused by lingering COVID-19 concerns, a fragile supply chain and Russia’s invasion of Ukraine, MMA agrees with (Whitmer) and legislative leaders that the top two paths to competitiveness are economic development and talent development.”
Whitmer said many of her proposals would coalesce when she presents her budget in two weeks.
“My proposals tonight will tackle the challenges people are facing right now, make a real difference in their lives and make Michigan more competitive,” Whitmer said. “This is our future. But policies alone mean nothing — it’s about the people they impact.”
Whitmer said having taxpayers pay for preschool for all 4-year-olds would save families upward of $10,000 in the cost of private preschool tuition.
“It helps parents, especially moms, go back to work,” Whitmer said. “And it will launch hundreds more preschool classrooms across Michigan, supporting thousands of jobs.”
In addition to her other priorities, Whitmer pushed for more protection for civil rights, including those for the LGBTQ community.
She tied such civil rights to the state’s economic success, saying a more inclusive Michigan would encourage young people to build their future here.
During her bid reelection campaign – as the U.S. Supreme Court was overturning Roe v. Wade, Whitmer pushed for eliminating a nearly century-old law banning abortion — she included abortion in in the civil rights discussion, calling the decision to have children “the most important economic decision” a woman makes in her lifetime.
“Protecting these freedoms is the right thing to do and it’s just good economics,” she said. “States with extreme laws are losing talent and investment because you know what? Bigotry is bad for business.” The line drew rousing cheers from Democrats; even some Republicans joined in the applause.
Jeff Donofrio, president and CEO of Business Leaders for Michigan, said Whitmer “gave a strong speech.”
“We share her focus on building a brighter future by prioritizing our children, talent attraction and retention, economic development and business climate,” Donofrio said. “We look forward to working with the Governor and Democratic and Republican legislators on many of these important proposals.”
