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Michigan House passes $450 million more for roads

The legislation, which heads to the Senate after solid bipartisan passage, would provide roughly a third of what Gov. Rick Snyder says is needed to bring roads and bridges up to par. Others think the funding increase should be $2 billion at a minimum.

By David Eggert
The Associated Press

5/9/2014

LANSING, Mich. — The Michigan House voted Thursday to set aside $450 million a year more on roads, but critics argued after a decade of legislative setbacks the money isn't nearly enough to fix the state's deteriorating transportation infrastructure.

The legislation, which heads to the Senate after solid bipartisan passage, would provide roughly a third of what Gov. Rick Snyder says is needed to bring roads and bridges up to par. Others think the funding increase should be $2 billion at a minimum.

Most of the additional transportation funding would be diverted from the state's general fund, which funds prisons, public universities and other programs. But the House also voted to raise revenue by converting the state's 19-cents-a-gallon gasoline tax to one based on price while increasing the 15-cents-per-gallon diesel tax to the equivalent of 19 cents to start.

The state Treasury Department could decrease fuel taxes to limit revenue increases from one year to the next to 5 percent or the inflation rate, whichever is less. The agency also could increase the rates to ensure fuel tax revenue is not less than in the 2014 base year.

"While you criticize the package as not being perfect, and it's not, it is a very good first step in getting us working on fixing Michigan roads," said Rep. Marilyn Lane, D-Fraser.

The legislation partly is intended to address a constant form of frustration — that Michigan's gasoline taxes are among the highest in the nation while its per-capita transportation spending is among the lowest because the 6 percent sales tax on fuel primarily goes to schools and locals governments.

A bill approved 91-18 would keep education and revenue sharing to municipalities intact while sending $130 million per year in leftover sales tax collected at the pump to roads and bridges instead of the general fund. Another bill, also approved 91-18, would set aside a portion of the 6 percent use tax — which is applied to online and catalog purchases and hotel bills — solely for road and bridge projects.

Proponents say if Michigan had moved to a wholesale gas tax when it last raised the per-gallon tax in 1997, it'd have the $1.3 billion Snyder is seeking today. Road agencies are getting less in state funding than a decade ago in part because people are driving less and with more fuel-efficient cars.

The conservative group Americans for Prosperity criticized lawmakers for moving to tax fuel on price, saying it is doubtful that residents "support automatic yearly increases in the taxes they pay at the pump."

But Snyder, a Republican whose call for bigger hikes in gasoline taxes and vehicle registration fees has not been embraced in the Legislature, applauded the House.

"The House package reflects a serious commitment to tackling this issue," he said in a statement. "It continues the critical dialogue as we work together to reach the ultimate solution that includes a stable, sufficient, long-term funding source."

Follow David Eggert at http://twitter.com/DavidEggert00


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