4182: FLOOR SUMMARY (Date Completed: 10-5-09) - 21ST CENTURY JOBS TRUST FUND

21ST CENTURY JOBS TRUST FUND H.B. 4182 (H-4): FLOOR SUMMARY
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House Bill 4182 (Substitute H-4 as reported with amendment)
Sponsor: Representative Fred Durhal, Jr.
House Committee: Appropriations
Senate Committee: Appropriations

CONTENT
The bill would amend the Michigan Trust Fund Act to transfer $42.0 million from the 21st Century Jobs Trust Fund to the State General Fund in order to help balance the FY 2008-09 budget, and would transfer $37.5 million from the 21st Century Jobs Trust Fund to the General Fund in FY 2009-10.

The bill also would increase the amount of tobacco settlement revenue that will be deposited into the 21st Century Jobs Trust Fund in FY 2015-16 from $30.0 to $72.0 million. Current language in the Michigan Trust Fund Act establishes FY 2015-16 as the final year for tobacco settlement revenue to be deposited annually into the 21st Century Jobs Trust Fund.

MCL 12.257 & 12.258

FISCAL IMPACT
The bill would transfer $42.0 million from the 21st Century Jobs Trust Fund into the General Fund in FY 2008-09. Various budgetary actions have occurred to make these funds available for transfer. These actions include the following: 1. Public Act 101 of 2008 amended the Michigan Tobacco Settlement Finance Authority Act to allow for the refinancing of the Tobacco Settlement Finance Authority bonds. This refinancing garnered $60.0 million of which $50.0 million was appropriated for the Michigan Promotion Program and business marketing, leaving a balance of $10.0 million.

2. As passed by the Legislature, the budget bill for the Michigan Strategic Fund (MSF) included an appropriation of $65.0 million in FY 2008-09 for the 21st Century Jobs Trust Fund. The Michigan Trust Fund Act requires $75.0 million to be deposited into the 21st Century Jobs Trust Fund each year through 2015. The difference between the allocation and the appropriation is $10.0 million, which is available for transfer to the General Fund.

3. Section 1027 of Public Act 261 of 2008, requiring a set-aside for Lakeshore Advantage, was vetoed, reducing the FY 2008-09 appropriation from $65.0 million to $62.0 million. The $3.0 million remains available in the 21st Century Jobs Trust Fund.

4. Executive Order 2009-22 reduced the FY 2008-09 appropriation to the 21st Century Jobs Trust Fund by $9.05 million, from $62.0 million to $52.95 million.

5. Executive Order 2009-22 directed the lapse of two work project accounts from FY 2005-0621st Century Jobs Trust Fund appropriations. The Agriculture Development Fund work project contained a balance of $5.0 million and the grant to the Michigan Forest Finance Authority work project contained a balance of $4.95 million. The total amount of the lapse is $9.95 million.

The total of these five actions is $42.0 million that is available for deposit to the General Fund.

The increase of the deposit of tobacco settlement revenue into the 21st Century Jobs Trust Fund in FY 2015-16 would reduce the availability of tobacco settlement revenue to other funds by $42.0 million.

The bill also would transfer $37.5 million from the 21st Century Jobs Trust Fund to the General Fund in FY 2009-10. This would leave $37.5 million in the 21st Century Jobs Trust Fund for use in FY 2009-10. Public Act 61 of 2009 appropriated $9.0 million in FY 2008-09 from the 21st Century Jobs Trust Fund to the Convention Facility Development Fund. The conference report on Senate Bill 245 adopted by the Legislature includes an appropriation of $28.5 million in FY 2009-10 from the 21st Century Jobs Trust Fund to the Michigan Strategic Fund for the Jobs for Michigan investment Program: 21st Century Jobs Fund.

Date Completed: 10-5-09 Fiscal Analyst: Elizabeth Pratt Maria Tyszkiewicz

Analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent. hb4182/0910