CHICAGO — Michigan legislators will introduce as soon as Wednesday a 13-bill package that aims to rebuild the state’s ailing transportation infrastructure by raising $1.4 billion of new revenue annually.
Among other measures, the package would raise the state’s gas tax and motor registration fees, allow local governments to also raise taxes and fees, and revise the current transportation funding formula in a few crucial ways.
Gov. Rick Snyder, a Republican, has said Michigan needs at least $1.4 billion of new revenue for transportation infrastructure and has called the effort a top legislative priority. He has not yet said if he supports the pending legislation.
Sponsors in the House and Senate are expected to introduce the package this week. The bills will then go to various committees for hearings.
The $1.4 billion figure comes from a recent legislative study co-sponsored by Rep. Rick Olson, R-Saline, who will also co-sponsor some of the package’s most important bills.
“Just to maintain our roads and bridges, with no additional projects, we need at least $1.4 billion,” Olson said. “No one has disputed the need, and so now the question is, how do we fulfill that need?”
The legislation would raise the gas tax by 9.3 cents to 28.3 cents by shifting the current fuel tax to a wholesale tax from a retail tax.
That would make Michigan the only state to collect just a wholesale fuel tax, and would also allow it to collect more money as the price of oil increases.
The legislation would also dedicate a piece of the state’s current 6-cent sales tax on gas solely to infrastructure projects. Currently, 4% of the 6% gas sales tax goes to schools and local governments, and 2% goes to the general fund.
Ensuring that 2% of the gas sales tax goes directly to transportation projects would raise roughly $100 million of new money.
“Our House Republican caucus is very much in agreement that we need to look at what we’re doing with current funding that’s available before we look at new revenue,” said Ari Adler, spokesman for House Speaker Jase Balger, R-Marshall.
Adler said the proposal to dedicate 2% of the current gas sales tax to transportation projects is an idea that could find favor among Republicans.
“The speaker realizes that it’s not going to solve our funding problem for infrastructure in this state, but the responsible thing is to at least look at it first,” Adler said.
Michigan transportation officials have warned for years that gas tax revenue is falling to the point where it threatens the state’s ability to come up with matching funds for crucial federal funding, and the Michigan Department of Transportation has repeatedly chopped its budget during the last few years.
