Taxing Michigan’s wealthiest to boost K-12 funding focus of potential ballot initiative

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May 25, 2025

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Taxing Michigan’s wealthiest to boost K-12 funding focus of potential ballot initiative

Michigan public education advocates are in the final stages of exploring a statewide ballot initiative that would tax the incomes of the state’s wealthiest earners in a push to drum up more funding for local K-12 schools.

But while nothing has been officially launched, organizers say they’re weighing language to submit to the state’s board of canvassers as soon as next month.

“I think we’re just seeing the writing on the wall that education funding is in a crisis in Michigan and in other places,” said Rachelle Crow-Hercher, director at the Michigan Education Justice Coalition, a statewide group spearheading the effort. “And this is something that we can do to at least help stop the bleeding.”

The coalition has been training potential volunteers to help collect signatures for a petition to put the question before voters. Other advocacy groups are sat the same time hosting in-person community meetings around the state about school funding disparities.

According to a 2023 study from the Education Law Center, it would cost an estimated $4.5 billion to fill major funding gaps in Michigan’s local school districts.

Currently, the ballot initiative idea, dubbed the “babies over billionaires” proposal, calls for a graduated income tax, or a roughly 5% surcharge on incomes over $500,000 for individuals and $1 million for couples. The goal is to raise $1 billion a year.

It’s an arrangement that, organizers said, wouldn’t impact most Michiganders whose income is already taxed at a rate of 4.25%.

It would help get more resources into classrooms, they said, without raising the tax burden across the board.

“People who need really robust, working public schools the most have the least ability to pay more, right? So, that can’t be the solution,” said Peri Stone-Palmquist, co-director of Student Advocacy Center of Michigan, which has offices based in Ypsilanti, Jackson and Detroit.

Since Republicans would likely not support a tax increase on the state’s highest earners, State Sen. Jeff Irwin, D-Ann Arbor, said a ballot initiative is the more feasible path.

“There’s no chance that the legislature is going to support something that would increase taxes on wealthy people when Republicans are in control,” he said.

The center hosted a couple school funding sessions in Washtenaw County in April, and Stone-Palmquist said they’ve been involved in funding solution talks in some form for six or seven years.

After gaps in things like student mental health needs and special education were “laid to bare” during the pandemic, she said the more recent school funding uncertainties at the state and federal levels have only heightened the need to diversify school funding. She called herself a “foot soldier” in the effort.

“It became clear how important this was,” Stone-Palmquist said. “So, I think you asked like why now? I mean, we would have said we should have already done this.”

Read more: 5 ways Whitmer’s $83.5B budget proposal would impact Michigan schools

More on how the ballot push works

The potential ballot push comes as Michigan lawmakers wrestle with finalizing the 2025-26 state budget, including school aid funds, with differing proposals from Gov. Gretchen Whitmer, the Republican-controlled House and Senate Democrats.

Although steps to dismantle the U.S. Department of Education with mass layoffs were blocked by a judge Thursday, May 22, it also comes months after federal spending cuts under President Donald Trump left school officials nationwide in limbo over a variety of school-related programs.

Read more: Michigan educators brace for impact after Trump orders federal education cuts

Both Whitmer and Senate Democrats called for raising per-student funding by roughly $400 from the current $9,608, though the latter proposed upping school investments in other areas above the $21.2 billion for education suggested by the governor in February.

The House passed a budget earlier this year that cut school aid funds by roughly $5 billion, or 25% less than the typical budget of close to or more than $20 billion.

Whatever is cut or boosted, school advocates said the funds will fall short of what’s needed.

“I know we’ve heard a lot of folks say, ‘Well, Michigan is putting more money than ever into schools,’ and when we talk about dollar amount, that’s accurate,” Crow-Hercher said. “But when we adjust for inflation, we’re still at 2009 levels of funding.”

Michigan’s constitution allows a state income tax but prohibits it in a graduated form. Also called a progressive income tax, it’s a system where the rate of taxation increases with income.

Any measure to change the setup would require amending the state constitution.

State lawmakers can amend the constitution with two-thirds of the House and Senate. Irwin, who’s referenced the ballot initiative at public events this spring, said he liked the idea of raising revenue for schools without raising tax burdens “on 75% or even 90% or 95% of people.”

Residents can initiate amendments to the Michigan State Constitution by collecting petition signatures from at least 10% of registered those who voted for governor in the last election.

Early plans for Michigan school advocates called for identifying and training 7,000 signature-gatherers, collecting 700,000 signatures in 180 days once OK’d by the state board of canvassers and putting it on the ballot in November 2026.

Crow-Hercher said they could have a much better idea of next steps by the end of the month.

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