New revenue sources for roads, repair possible under lawmakers’ proposals

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Several bills are floating around Lansing that could change the way Michigan funds its roads — some aiming to tackle an ongoing lack of state revenue.

According to one bi-partisan House workgroup’s recent recommendation, $1.4 billion per year through 2015 is needed for maintenance goals to be met.

Tony Casali, manager for the Isabella County Road Commission, said it’s important for officials to agree on a long-term funding solution.

Over the last five to six years, the road commission has endured cuts, including a near-$800,000 budget decrease and a reduction in staff from 51 to 37, because of the lack of revenue.

As it stands, Casali said about 165 miles of county roads need to receive a “grind and pave,” or a fresh three-inch layer of asphalt, which carries a near $170,000-per-mile cost.

“That’s $28 million right there. It isn’t going to get done,” he said. “We are not fixing the problem here. We’re kicking the can down the road.”

The proposals

A two-part plan targeting roads’ two sources of revenue is expected by state lawmakers to be proposed by Gov. Rick Snyder this month.

One area aims to raise drivers’ registration fees. The other part would move the state gas tax to a fuel-based model. Fewer than 20 cents of every gallon currently go to roads, but tax revenues continue to slip as more fuel-efficient vehicles emerge.

The fuel tax component is “really broken,” said state Rep. Kevin Cotter, R-Mount Pleasant, but that reworking it may be a viable option, as it could compensate for wear and tear to in-state roads from out-of-state drivers.

An additional proposal sitting in the state Senate would replace the gas tax with a bump in the state sales tax from 6 to 7 percent — revenue from the added percentage point going toward roads.

Of the Senate bill, Casali said, “That is a legitimate option that is out there. Does it fix all the problems? I can’t answer that at this point.”

Consolidating government

A bill made headway among lawmakers at the end of last year that would give county governments the option to absorb road commissions’ authority and responsibility. It was first approved in the state House in November, was amended in the Senate and has returned to the House.

For counties such as Isabella, where the road commission consists of elected members instead of appointed, county boards of commissioners would be allowed the discretion to put the decision on the ballot. Where boards are appointed, boards could decide with a two-thirds majority vote.

“This is one proposal that says, ‘OK, before we raise taxes, let’s look at (better) using the money we already have,” Cotter said.

County Commissioner David Ling, who in December was the commission chairman, said bringing road commission duties under the county’s umbrella could make operations more transparent.

However, Ling said, “I’m guessing the savings aren’t that great.”

Cotter said lawmakers will know more about the goings-on following Snyder’s State of the State address Jan. 18, later in the month and into February.

“We’re waiting and hoping that something will come down the pipe that both sides of the aisle agree to,” Casali said. “This being an election year, this may be an even bigger hurdle.”