EPEEJNNLLDGMKDPEJCJLEELOCDAA.firstname.lastname@example.org">Cuts laid out by lame-duck Governor John Engler today in Executive Order 2002-22, and approved by legislative committees hours later, could force layoffs of the state's toxic cleanup staff during fiscal year 2004 and shut down many if not most cleanup projects the following year. It's unfortunate that our state's fine deliberative body could not wait a few days to digest the impact of the proposed cuts. The executive order switches $40 million in environmental bond repayments from the state general fund to restricted fund sources that have been used to support the cleanup program itself.
One source of cleanup funding is the Environmental Response Fund (ERF). Monies recovered from liable parties are deposited in the ERF. This money is used to support staff costs for the cleanup program. The executive order reduction of $10 million in the ERF will force the fund to run out of money in the second quarter of fiscal year 2004.
Because of the general fund funding shifts, the ERF annually supports approximately 80% of Michigan ’s total state -funded cleanup staff. Unless a new funding source is found, Engler's executive order reduction of $10 million will shut down the state funded cleanup program half way through next fiscal year.
Another source of cleanup funding is theCleanup and Redevelopment Fund (CRF). Sixty percent of unclaimed bottle deposit revenues that revert to the state are earmarked for support of the cleanup program. This has been producing about $12 million annually for the fund, of which about $8.2 million has been appropriated annually for cleanup activities. CRFmonies are used for both Part 201 and leaking tank cleanup projects. This has allowed the balance to grow in the fund.
The executive order budget cut remove s $30 million of the existing fund balance. This cut will deplete all except $10 million of the CRF balance available for future appropriations. It is likely the CRF will zero out in fiscal year 2005. At that time, the $12 million annual revenue to the fund won't be sufficient to meet annual needs for priority projects such as water supply replacements, emergency response, and operation and maintenance of ongoing remedies. In addition, it will not cover costs for completion of partially completed projects or newly discovered sites.