LANSING -- Governor Granholm's proposals for the 2011 state budget were unveiled in Lansing Thursday.

Again this year - budget cuts and some new tax proposals are all a part of the governor's plan.  For only the second time in her two terms as the state's leader, Governor Granholm herself delivered the budget proposal.

She started by outlining a number of programs she wants to protect, including making no cuts to local government revenue sharing and no cuts to state police. The Governor also wants to eliminate the Michigan Business Tax Surcharge by 2012, but most importantly, she says, is protecting workers and jobs here in Michigan. The governor says the way to do that is to protect education. "Remember schools took huge cuts in the year they're operating in right now. That's enough."

The Governor wants to revive the Michigan Promise- the college scholarship that was eliminated for the current fiscal year. But she'd bring it back as a tax credit for students who graduate, and commit to working at least one year in their home state. "We ought to make sure those who get the Promise Scholarship are the people who will be contributing to the Michigan economy."

"PURE MICHIGAN" tourism funding would be saved by adding a fee to rental cars at airports. And the Governor says she wants to protect the size of the Michigan State Police force, and protect Revenue Sharing for local governments.

But now the question becomes how to pay for it all - when the Governor herself acknowledges the state needs to cut back. Granholm is asking for early retirement from State employees and teachers. "These reforms contain some tough but necessary changes to both retirement and health care benefits for public employees."

She's also asking State employees to contribute 3% to their pensions - a policy she says used to be in place but was stopped in the 1970's. And the Governor is calling for limits to lifetime health benefits. One specific example: stopping vision and dental benefits in retirement for anyone who does NOT retire by October 1st. 

The other main source of revenue, a change to the state sales tax. The Governor wants to drop the tax from 6% to 5.5%, but raise revenue by expanding the tax to services. She says it would update a 60-year old tax structure, and would still give Michigan one of the lowest sales tax rates in the country.

The Governor is also calling for an end to one of the most controversial taxes on Michigan Businesses. "To help spur business growth and development I'm also calling for the elimination of the Michigan Business Tax surcharge. I propose cutting the surcharge in half in the 2011 budget and eliminating it completely in 2012."

Here are some of the other things Governor Granholm wants to change: The Governor says she will veto any budget from the legislature that cuts education funding.  She says she will also veto any move for a temporary budget extension which would pass the problems off ot the next legislature or governor. Granholm also says it should be a "pay as you go" budget, meaning all new programs and spending must also identify a funding source.

To see how local lawmakers are reacting to the budget proposals click HERE.

To see more details on the Governor's budget plan click on THIS LINK.  You can also take part in our poll below, and leave a comment about your thoughts on the budget proposals.