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 Q&A with Michigan’s Budget Director John Nixon, CPA
He currently serves as President of the National Association of State Budget Officers (NASBO). Nixon holds a BS degree in Corporate Finance from Brigham Young University and an MBA with an emphasis in Information Technology from the University of Utah. Nixon and his wife DeAnn have six children, three boys and three girls. You’ve been in Michigan for less than a year, and I imagine it’s a significant change from Utah. How did your transition go? Nixon: The transition has been very smooth. To your point, it’s been a significant change. I’ve traded mountains for lakes, and I am adjusting to the humidity. The first few months were probably the most difficult for me personally, as it was my first time living away from my wife and six children. Once my family moved here to Michigan and the children were enrolled in school, the transition seemed much more complete. Even though Michigan has its own unique challenges and opportunities, the actual job of budget director is very similar to Utah, as all of the states are facing similar issues when it comes to solving budget gaps. I am proud of the budget we have put together here in Michigan. I think it’s one of the best in the country and it puts us on strong financial footing as we move forward. How did the Governor convince you to bring your expertise to Michigan? Nixon: The governor is a persistent guy. When I was originally approached, my first response was that I’d be happy to help Michigan find a good budget director. When I realized they were interested in me, I told the Michigan team that life was good for the Nixon family in Utah. With a new governor just elected, and having just moved into our dream house, I really wasn’t looking for new opportunities. But they convinced me to fly out to Michigan, and it didn’t take long for me to realize that Governor Snyder had a clear vision and that there was a real opportunity to be part of something big. It became clear very quickly that I had a unique opportunity to help reinvent a state that’s been down for a long time, and that the leadership was in place to make it happen. I wanted to be part of that effort and part of the team assembled to do it. You’ve certainly made a huge impact in a short period of time. When Governor Snyder set the May 31 goal of completing the 2011-2012 fiscal year budget, I can tell you first-hand that many Capitol insiders practically laughed. How did you get it done? Nixon: When you combine working in dog years with relentless positive action, you can get a lot done. We felt like it was critically important to get the budget done early. It’s important to let those who depend on state funding know what to expect so that they can, in turn, plan for their budget. There was a very clear focus on getting this budget done and passed. Nobody wanted a repeat of past years with threats of a government shutdown. There were a lot of long days and nights and a lot of careful thought that went into this budget. As I’ve said, I think it’s one of the strongest budgets in the country. Tell us about how your background, your CPA license and how your experience positioned you to tackle Michigan’s fiscal issues head-on. Nixon: I can remember a conversation I had back in high school with the CFO of my father’s company who had paid a visit to the house. I was trying to figure out what I wanted to do for a career and I remember the conversation clearly because he told me whatever I decided to do in life, I would be well served to understand numbers. It resonated with me and made a lot of sense, and it led me down a path that resulted in a BS degree in Corporate Finance from Brigham Young University. I went on to earn an MBA with an emphasis in Information Technology from the University of Utah. Earning my CPA license opened a lot of doors. I served as the CFO of a privately held company, and I worked in the financial services industry before making the leap into state government. My experience as budget director in Utah, serving Governors Jon Huntsman and Gary Herbert, gave me the experience and knowledge necessary for success in Michigan. Now, as the Director of the Department of Technology, Management and Budget, I am focused on the budget as well as other important government functions, including information technology. Without that early discussion with the CFO of my father’s company, which ultimately led to my education path and earning my CPA license, I wouldn’t be where I am today. With regard to tackling issues head-on, I don’t know any other way. I was well aware of the fiscal challenges facing Michigan before I took the job, but I saw a leadership team in place that was ready to tackle issues, and I wanted to be part of it. By tackling issues like we have, we’ve made tough decisions and put Michigan on strong financial footing for the future. We’ll continue to tackle the tough issues head-on. And... working with a Governor who is also a CPA? Let me start by simply saying I have learned a lot from Governor Snyder. He is one of the smartest individuals I’ve ever been around. And it’s made my job as budget director easier because he gets it. Governor Snyder understands numbers, he understands the budget inside and out, and when I give him a spreadsheet or budget document, there isn’t a whole lot of explaining I need to do. Governor Snyder went through every part of this budget and made tough choices to get Michigan’s financial house in order. There were no longitudinal cuts where he said cut X percent across the board … he looked at every piece of the budget and made thoughtful decisions with his team in presenting his recommended budget. It’s been a great learning experience for me, not just because he is a fellow CPA, but because of his leadership style and strong positive attitude when it comes to turning the state around. What’s next? What will the end of 2011 and beginning of 2012 bring from the Administration in relation to the state’s finances? The good news is we’ve now got this budget in structural balance. The one-time gimmicks and one-time solutions to prolong tough decisions are gone. We made the tough decisions and thoughtfully passed a budget that puts us on solid footing. The revenue picture continues to be promising. Even with the debt ceiling issues facing our Congress and the downgrade in the federal credit rating, Michigan’s outlook is improving. Fitch Ratings has moved our state’s outlook from stable to positive, citing prudent budgeting. The other rating agencies are also taking note. Monthly revenues continue to come in higher than projected. I think you can expect a much different budget process in 2012. Instead of a process focused on eliminating $1.5 billion in debt, we’ll have a process focused on the priorities we’d like to fund. Because of that, I think you’ll see more innovation and ideas in this next budget -- things we simply didn’t have the luxury to talk about in 2011. Top
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| PO Box 5068 Troy, MI 48007-5068 Phone: 248.267.3700 Fax: 248.267.3737 E-mail: macpa@michcpa.org | |
