2025 State Budget Consensus Revenue Estimating Conference

There is a wide disparity in the revenue projections for the upcoming fiscal years based on numbers from the Senate Fiscal Agency and the Department of Treasury. This is not a common occurrence.

The report from the Senate Fiscal Agency at the Consensus Revenue Estimating Conference (CREC), held in early January, estimated that the state would close Fiscal Year 2024 (ending last September 30) with over $900 million more than expected in its General Fund (GF) and School Aid Fund (SAF) combined. Additionally, the report indicated that Fiscal Year 2025 (starting October 1) looked even better, with $1.2 billion more than anticipated due to revenue increases from income taxes, sales taxes, business taxes, and insurance taxes. Furthermore, as the Governor and state legislators begin to look at Fiscal Year 2026, revenue is expected to add another $1.4 billion.

A week later, due to a much less optimistic forecast, the Department of Treasury indicated drastic reductions from the original numbers above, but still on the positive side: $479 million for FY25 and $563.2 million for FY26.

The report expects Michigan’s economic growth to essentially mirror the economic growth of the United States: a slowing employment rate, accompanied by an increase in the unemployment rate. The report also expects consumer spending to slow in both the country and the state, with uncertainty over changes in federal budget policy and priorities. View the Senate Fiscal Agency Report: Michigan's Economic Outlook and Budget Review (PDF).