LANSING—Senate Majority Leader Arlan Meekhof, R-West Olive, today reiterated that the Senate is willing to fix Michigan’s roads and bridges.
“The Senate tackled the issue of funding for our roads in July. My colleagues and I passed a plan that redirects current spending to prioritize roads, generates new revenue for a long-term solution and returns dollars to hardworking taxpayers when our state prospers.
Since passage of the Senate plan, I have been realistic in my expectations that ultimately a road funding plan would include compromise in order for all parties to agree. For me, taxpayers deserve long-term tax relief, especially when we are seeking additional resources to fund our roads. I am disappointed that months of discussion and progress at the leadership level have stalled, but a standstill at the leadership level is not an indication of unwillingness on the part of the Senate.
My senate colleagues and I have demonstrated that we are willing to solve the issue of road funding. The bottom line is the citizens of Michigan made it clear that road funding should be a priority of state government. The priorities of the taxpayers are the priority of the Michigan Senate,” said Meekhof.
In July, the Senate passed an eight-bill bipartisan road funding package.
Under the Senate-passed plan, beginning in Fiscal Year 2017, $350 million in General Fund revenue would be redirected and dedicated to a newly created section of the Michigan Transportation Fund. In Fiscal Year 2018, the redirected revenue would grow to $700 million making roads a priority for state spending.
Additionally revenue would be raised through incremental increases in the state gas tax rate until January 1, 2017. The rate would then increase by the rate of inflation for each additional year in order to keep pace with the increasing costs of maintaining roads and bridges.
Diesel tax would initially be phased in at a higher rate to achieve parity with the state gas tax. Both gas and diesel tax would increase to 34 cents per gallon on January 1, 2017. The gas tax and diesel tax sunset in 2034.
When fully implemented, the combination of redirected funds and new revenue would result in $1.5 billion for Michigan roads and bridges.
The Senate plan also presents an opportunity to control the growth of government. Senate Bill 414 created an automatic rollback of the state income tax rate each year that General Fund revenues exceed inflation.
Each fiscal year, General Fund expenditure growth would be limited to the rate of inflation. Economic growth over and above inflation would be returned to the taxpayers in the form of an income tax rate reduction.
Additional bills in the package also require road construction warranties for projects in excess of $1 million. MDOT and local agencies would be required to competitively bid for most projects that exceed $100,000 and townships would be encouraged to issue requests for proposal for projects of a certain amount that include at least 50 percent township resources.
To keep pace with changes in technology, the package institutes a process and fee schedule for taxing alternative fuels and imposes an additional registration fee for hybrid and electric vehicles.
The package is comprised of Senate Bill 414 and House Bills 4610-4616.
For more information please visit, www.fixingmiroads.com