By DAVID EGGERT
LANSING, Mich. (AP) — Republicans who control the Michigan House proposed a new transportation-funding plan Wednesday that would not raise fuel taxes but would direct an additional $800 million toward local roads.
The proposal’s central provision is similar to one that was not embraced last year by Gov. Gretchen Whitmer because of her concerns about harm to other parts of the budget. If passed, the plan would eliminate Michigan’s 6% sales tax on fuel over three years and replace it with an equivalent per-gallon increase in the gasoline tax.
The school aid fund, which receives much of the sales tax collected at the pump, would remain funded by diverting income tax revenue from the general fund. All of the roughly $800 million from the replacement tax would go to local roads, which GOP lawmakers said is appropriate since Whitmer recently announced $3.5 billion in borrowing to repair various routes over five years.
Also on Wednesday, the Republican-led Senate voted on party lines to give the Legislature the ability to reject any state attempt to issue more than $100 million in transportation bonds. Whitmer will veto that bill if it reaches her desk.
“Michigan has tried bonding for roads, and it has tried raising taxes. Neither has solved the underlying problem, and the new bonding scheme introduced (in January) won’t be any different,” said House Speaker Lee Chatfield of Levering. “We need to make sure the funding we already have is spent correctly before we simply throw more money at the problem and watch it get sucked away into other projects. This reform will finally fix this mistake.”
The legislation would provide a $800 million boost to the state’s $5 billion transportation budget. Whitmer and others have said Michigan needs at least $1.9 billion in additional funding — more if it unwinds a component of a 2015 road-funding law that shifted general funds to roads.
Legislators last year rejected Whitmer’s proposed 45-cents-a-gallon fuel tax increase. The State Transportation Commission in January unanimously approved her “Plan B,” a bonding plan that she said was needed to repair crumbling infrastructure but would not provide a long-term remedy.
The bill sent to the House by the Senate would require the panel to give the Legislature 30 days notice of its intent to issue more than $100 million in bonds. Lawmakers would have 30 days to block the borrowing.
“The Michigan people need an affordable solution that fixes the roads and doesn’t saddle them down with decades of debt,” said Senate Appropriations Committee Chairman Jim Stamas, a Midland Republican who called on Whitmer to come to the table to work on a “reasonable long-term plan.”
“We acknowledge that bonding has a use, but not as broad a use as how it’s currently being intended,” said Senate Majority Leader Mike Shirkey of Clarklake.
Whitmer has long implored GOP leaders to “get serious” and propose road-funding plans. Sen. Curtis Hertel Jr., an East Lansing Democrat, said the bonding-related legislation is “clearly unconstitutional” because the Legislature can only act by presenting bills to the governor.
Whitmer said the State Transportation Commission recognized “we have to move dirt now to protect people in our state and to lock in low (interest) rates. It’s a smart thing to do. The Legislature is just figuring out the scope of executive authority and — no surprise — they’re trying to take it away. But that’s not going to happen.”