Legislative Leaders’ New Route to Increase Transportation Funding an Unlikely Win in Lansing

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After a brief hiatus, conversations on transportation funding are again under way in Lansing. The $1.2 billion increase in transportation revenue that Governor Snyder requested back in February could come through a convoluted transfer of education dollars to transportation funding,  according to one recent proposal. We think it has a low likelihood of success.

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When summer legislative break began with no vote on a transportation funding package in the House Transportation Committee (more on that here), Michiganders were left wondering when our crumbling transportation system would find some relief.

As summer break now dwindles to an end, legislative leaders – Senate Majority Leader Randy Richardville (R-Monroe), Senate Minority Leader Gretchen Whitmer (D-East Lansing), House Speaker Jase Bolger (R-Marshall) and House Minority Leader Tim Greimel (D-Auburn Hills) – are reportedly talking with Governor Snyder about a new transportation funding solution – one that could meet Snyder’s $1.2 billion recommendation without raising the gas tax or registration fees.  After speaking to the offices of Senator Whitmer and Senator Richardville, it is clear that preliminary discussions are moving toward a package that would:

  • Dedicate all of the 6% sales tax on gas to transportation funding (the 19 cent-per-gallon gas excise tax that already goes toward transportation funding would remain unchanged). Currently, the gasoline sales tax revenue does not simply fund roads; rather, it goes toward education and, revenue sharing as well as transportation.
  • Place a one-cent sales tax increase on the ballot in November to fill the hole in education and revenue sharing created by the gas sales tax diversion.

After speaking to legislative staffers, it is apparent that discussions are still in a very preliminary stage.  A staffer from Senator Richardville’s office indicated that the “Majority Leader’s first priority is Medicaid; however, transportation funding is next on the list.”  Senator Whitmer’s office emphasized that “nothing is set in stone and there has only been one meeting [between the four legislators].” According to our sources, a meeting to further discuss this proposal is on the agenda for the legislative leaders this Friday.

While this  proposal attempts to please lawmakers on both sides of the aisle as well as voters, it disguises an increase in transportation funding as an increase in education funding – a proposal that legislators will likely strike down before it has a chance on the ballot.

The experience of the previous transportation funding bill package made clear that Republicans are not willing to vote for an increase in the gas tax or registration fees. House Democrats may be more likely to support this potential proposal with provisions that protect revenue sharing, and increases funding to education, according to Representative Marilyn Lane’s (D-Fraser) office.  Even with bipartisan support, it will be difficult to garner the hefty 2/3 majority House and Senate votes needed to put the sales tax increase on the ballot.

Fast approaching deadlines pose major obstacles for a potential bill package – at least to get a proposal on this November’s ballot.  In order to place a sales tax increase on the November 2013 ballot, it must be approved in the legislature by September 4 – the week lawmakers officially return to the capital.  Additionally, according to the Secretary of State 2013 Election Calendar, the official wording of any ballot proposals must be submitted to county and local clerks by August 27.

According to a recent report from Michigan Radio, both Senator Richardville and Senator Whitmer recognize that the likelihood of getting a proposal ready for November are far from realistic.  The report also stated that both senators aim to continue discussions and expect to have a proposal ready for the May or August 2014 ballot.

As much as we, here at Trans4M, recognize the urgency for an increase in transportation funding, this reported proposal will not likely gain the traction it needs to be successful.  This route to a transportation funding solution presents too many obstacles without forcing legislators to directly, and openly, support increased revenue to current transportation funding sources or create viable new funding options.

Stay tuned for updates on our blog as the discussion on transportation funding continues.

Written by Liz Treutel, Trans4M Fellow

5 Comments on “Legislative Leaders’ New Route to Increase Transportation Funding an Unlikely Win in Lansing

  1. The question I have is what does “transportation funding” include? I assume that gas tax is only currently allowed to fund fixing roads, bridges and other car-centric projects. Would that be the case moving forward? Seems like BRT or existing bus systems should be getting a slice of that pie.

  2. Thanks for your comment, Justin. In this case, we are using “transportation funding” to refer to the Michigan Transportation Fund (MTF) which currently receives revenue predominantly from the gas tax and vehicle registration fees and taxes. The MTF uses the “Act 51 formula” to fund everything from roads and bridges, to rail, to bike paths, to public transit; however, roads and bridges are the major recipient of those funds and the Act 51 formula dictates what portion of the MTF go into various aspects of our transportation system. We agree that investment into public transit needs to be increased and that begins with an overhaul of the “Act 51 formula” – mostly to allow more money to go into improving our bus system or creating a BRT, like you mentioned. As far as this potential proposal goes – it is likely that the funds would go into the MTF, so getting a larger portion of that increased funding into public transit would be the next bridge to cross. At the moment, any increased funding to transportation would help the whole system.

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