Budgeting for Michigan’s Future: A Conversation with State Budget Director Jen Flood

Join State Treasurer Rachael Eubanks and Michigan State Budget Director Jen Flood as they discuss Governor Whitmer’s Fiscal Year 2027 budget recommendation.

In the latest Treasury Talk episode, they walk through the major proposals shaping the FY27 budget, including Michigan’s literacy investment, plans to stabilize Medicaid, and targeted tax relief for working families and seniors.

Flood also highlights recent fiscal milestones—such as strengthened reserves and a credit rating upgrade—and explains how the FY27 plan fits into Michigan’s broader financial strategy.

This episode offers a clear, straightforward overview of what’s in the proposed budget and why it matters. 

RESOURCES 

Additional information about Governor Whitmer's Fiscal Year 2027 Executive Budget Recommendation is available on the State Budget Office's website.

Transcript

Intro:
Welcome to Treasury Talk, a podcast featuring timely tips and information for Michigan taxpayers, hosted by State Treasurer Rachael Eubanks.

Listen for takeaways from our subject matter experts that will support you, your family, and your business.

Treasurer Eubanks:
Welcome back to Treasury Talk, where we explore the people, policies, and programs shaping Michigan's financial future.

I'm your host, State Treasurer Rachael Eubanks.

Today I'm joined by someone who plays a pivotal role in shaping Michigan's budget landscape, State Budget Director Jen Flood.

In this episode, we're going to be diving into the governor's fiscal year 2027 executive budget recommendation, look at some of the benefits under the Saving Michiganders Money Plan, and then reflect on the state budget over the last seven years.

Director Flood, welcome to the podcast.

Director Flood:
Thank you for having me on.

Treasurer Eubanks:

So let's start with the big news.

Governor Whitmer's fiscal year 2027 budget recommendation was presented in front of a joint session of the State House and Senate Appropriation Committees on February 11th by you.

For those who are not familiar with this process, this is a proposed budget recommendation from the Governor.

And from here, the Michigan Senate and House will review the proposal and begin negotiations with the Governor's office to decide what the final budget should look like.

Let's begin with the big picture.

The governor's budget recommendation totals $88.1 billion.

What does this mean for Michigan families?

And how will this budget make a difference in daily life?

Director Flood:

At its core, this budget is about lowering costs and creating opportunities.

It includes major investments in education, healthcare and infrastructure.

And for families, that means free school meals, expanded literacy programs and tax relief measures that put money back in people's pockets.

Treasurer Eubanks:

So let's focus on literacy this year. What does it look like in Michigan?

Director Flood:

Like across the country, too many kids are struggling to read at grade level.

Those kids need our support.

And that's why the governor's budget includes the biggest investment in literacy Michigan has ever made.

 Michigan is investing $625,000,000 in literacy.

This funds phonics based instruction, letters training for teachers and expanded summary and after school programs.

 The goal is to boost reading proficiency which is critical for long term success.

 Picture a teacher getting letters training to help struggling readers.

 These changes touch real lives.

In addition to dollars for literacy, I also want to note this budget proposes a 2.5% increase in per pupil funding.

That's about $250 per student, and those dollars go a long way to make sure that all kids have access to high quality education.

 We're also proposing to continue free school meals to fight food insecurity.

 When kids come to school with food in their bellies, they're ready to learn.

 We're giving students and educators the resources they need to be successful.

Treasurer Eubanks:
So shifting gears to healthcare, you mentioned healthcare as being a big part of this budget as well.

So the proposal includes A sizable amount of dollars and revenue generation ideas for Medicaid stabilization.

 What's the strategy here?  Why does this matter for the well-being of Michiganders?

Director Flood:
Families across Michigan are tightening their belts and the state is too.

The budget recommendation for next year is a responsible mix of revenue cuts and efficiencies that make the most of every dollar we have.

The past year's been a roller coaster.

Congress passed HR One and immediately blew a billion dollar hole in our budget.

Federal funding has been frozen and then unfrozen, and we all experienced the longest federal government shutdown in our nation's history.

Well, we took steps to mitigate the damage of HR One last year.

We have significant future costs coming due, and Michigan is facing broader budget pressures like rising inflation.

The governor's focused on protecting healthcare access for all Michiganders by protecting Medicaid.

 The Fiscal Year 27 budget helps ensure residents can get the care they need when they need it, keeping families healthy and preventing financial hardship from unaffordable medical costs.

The revenue proposals in this budget are about ensuring we can sustain Medicaid, protect essential services, and maintain a balanced budget without pushing costs onto working families.

To ensure Medicaid funding is sustainable, we're proposing an update to the tax structure for vaping and non tobacco, nicotine products, digital advertising, sports betting, and Internet gambling.

These changes help protect coverage while keeping the state's finances on stable ground.

 If we don't find a way to fund this important program, millions of Michiganders could lose their access to healthcare.

Treasurer Eubanks:
So listeners also want to know, how does the Saving Michiganders Money Plan help people's household budgets?

Director Flood:
The Governor's budget is focused on lowering costs for Michiganders where it matters most, helping families with everyday expenses, protecting healthcare access, investing in education and infrastructure, and providing relief to working families and seniors.

Overall, the budget balances immediate relief with long term investments that save money and deliver results for residents across the state.

I'm really proud of the targeted tax relief we've been able to provide to working families by quintupling the Working Families Tax Credit and for seniors by rolling back the retirement tax, but we're not stopping there.

The governor has also recommended providing property tax relief to seniors and establishing a back to school shopping holiday so families can save money when they're shopping for back to school supplies.

 his budget is focused on investing in programs and services that benefit all Michiganders.

Treasurer Eubanks:
There are also some other benefits coming online in 2026 that will help working Michiganders and seniors. Let's talk about that a little bit.

Director Flood:
Some major benefits that were pastoring the last budget took effect this year, including exempting tips, overtime and Social Security from state taxes.

When you combine the exemptions on tips, overtime and Social Security, plus rolling back the retirement tax and quintupling the Working Families Tax Credit, we put hundreds of millions of dollars back in people's pockets.

Treasurer Eubanks:
Overall, what do you want Michiganders to take away from this budget?

Director Flood:
This budget is about delivering on promises made, and we've done that by passing a sustainable and long term road funding package, investing in education at historic levels, putting every child on a path to lifelong success, and focusing on the issues that matter the most to Michiganders.

A budget is more than just numbers on a spreadsheet.

It reflects our values and priorities.

Treasurer Eubanks:
If you're following along and want details, you can view the Fiscal Year 27 Executive Budget recommendation materials at michigan.gov/budget.

 So, Director Flood, you have served in various roles in state government.

 How has your experience shaped your approach as budget director?

Director Flood:
My time in the governor's office working on legislative and public affairs really shaped my tenure as the state budget director.

Working directly with lawmakers, state agencies, and stakeholders across the state taught me how to bring people together, navigate tough issues, and keep the focus on delivering real results for Michiganders.

Those experiences gave me a true statewide perspective and understanding of how interconnected our priorities are and how the budget touches every part of what state government does.

It's helped me approach this role with a deeper appreciation for the impact that our decisions have on families, communities, and the long term strength of our state.

Treasurer Eubanks:
I think after working with you for a couple years, one of my observations has been you have an amazing ability to translate numbers into stories and values and things that mean, you know, real value to people.

 So I've always very much appreciated that about your approach.

 When people look back at the Whitmer administration, what do you hope they'll remember about its legacy, especially in terms of budgeting and public investment?

Director Flood:
Governor Whitmer has always been focused on the kitchen table issues that make a real difference in people's lives.

 When you look at something like long term sustainable funding to fix our roads, it's still about people.

Fixing our roads is about keeping drivers safe on the road and helping families save time and money.

 Michigan has a lot to be proud of.

 Wages and home values are up.

 We passed a sustainable long term road funding package. 

 No child goes hungry at school.

 Pre-K and Community College are both free.

 We're recommending another year of record investment in literacy, and our reserves are more than double what they were when the Governor took office.

Treasurer Eubanks:
It might be hard to decide, but what's 1 budget decision or initiative you're especially proud of this year?

Director Flood:

I'm really proud of the budget that we passed last fall that protects core Medicaid Services while making sure that Michigan's budget remains responsible and sustainable.

With all of the changes at the federal level, we made it a priority to make sure that the more than 2.5 million Michiganders who rely on Medicaid to access healthcare could continue to access that year.

 That's more than 25% of our state's population.

 It's a million children, seniors, disabilities and pregnant women.

And making sure that they have a path to care going forward to even after all the federal changes and pressures is one of the biggest things that we've done during the governor's time in office.

Treasurer Eubanks:
 
And looking ahead, what's the one thing that will matter most five years from now?

Director Flood:
Literacy.

Strong reading skills today mean higher graduation rates, more opportunities for our kids going forward, and a stronger economy tomorrow.

Investing in our population today is something we must do.

Governor Whitmer's commitment to ensuring every child has the tools they need to succeed is reflected in her Fiscal Year 27 budget.

Our historic literacy investment reflects the reality that reading success starts early and requires more than just textbooks.

It requires science of reading, training curriculum and coaching, while also expanding pre-K and after school programs that research shows are critical to helping kids become strong readers.

If we're serious about every child being proficiently, we've must invest in the full pipeline that makes that possible.

Treasurer Eubanks:
So you get you get to touch so many things across the state government and state budget.

And I know we just scratched the surface here of everything that you do and work on, but is there anything that we missed, anything that you really want to talk about that we didn't touch on so far?

Director Flood:
I think the one thing I would highlight is the opportunity that we've had to work together and we approach the state's finances from different seats.

But we've been really strong partners over the last seven years.

And I often get to brag about the work that you do when it comes to paying down debt and having our credit ratings upgraded.

And so I think that the partnership we've had, I've learned so much from you and we've set our state up for success in the long term.

Treasurer Eubanks:
I feel exactly the same way.

I often say that we are two sides of the same coin.

We have very different roles, but we're both trying to accomplish the same goal of having a more successful, financially successful Michigan.

So I very much have enjoyed having a partner in that as well.

Well, Director Flood, thank you for joining us today and sharing details about the Governor's Fiscal Year 27 Executive Budget recommendation.

There is a lot in this proposed budget, and to our listeners, thank you for turning into Treasury talk.

We hope today's conversation gives you a deeper understanding of how Michigan is budgeting for a stronger marketable future and how investments in Michiganders and education are paving the way for a lasting impact.

Want to learn more about Governor Whitmer's fiscal Year 27 executive budget recommendation?

 Visit michigan.gov/budget or reach out to us at treasuryoutreach@michigan.gov.

 Until next time, take care and thank you for listening.