Introduced
by
To establish a new "school aid rainy day fund," as proposed by Gov. Jennifer Granholm, with $98 million of the money disbursed to states by the federal government under the 2003 tax cut bill. Money placed in the existing "rainy day fund" (Budget Stabilization Fund or BSF) may be used for many purposes including school funding, but money in the "school aid rainy day fund" could only be used for education related purposes. A provision of the regular BSF requires that if its balance drops below $250 million, this stops the 23-year phase-out of the Single Business Tax (value added tax) on businesses. For this reason the phase-out was stopped at of 2002. Money placed in the "school aid rainy day fund" would not count toward this minimum tax-cut threshold level, which could postpone further steps in the phase-out of the Single Business Tax.
Referred to the Committee on Appropriations
