By Rep. Greg MacMaster
Members of the legislature don’t agree on much, but one thing we all agree on is that Michigan’s roads are in poor condition and must be fixed. The difference legislators have is in how to accomplish that.
There is a general consensus that an additional $1.2 billion is required each year to fix our roads.
There are some who believe all the efficiency’s have already been achieved in the funding, construction and maintenance of our roads and that we must now raise taxes.
There are others, such as myself, that believe we can fix our roads by being innovative, more efficient and without resorting to raising taxes on motorists who are already paying the 6th highest gas tax in the country.
Following are five reform proposals that include some of Speaker Jase Bolger’s recent transportation funding proposal. They also include other reforms that were introduced last year but have not been acted on.
These reforms identify over a billion dollars that can be allocated to roads WITHOUT increasing taxes;
(1) Dedicate a portion of the sales tax on gasoline for roads.
When motorists purchase gasoline, they pay state and federal taxes for each gallon. Motorists also pay a 6% sales tax on top of that, which most people assume goes to roads. It doesn’t. It’s diverted to other government spending.
Dedicating 1.5% of the 6% for roads doesn’t solve the problem of diverting money people believe already goes to roads, but it’s a start.
This is a modification of Speaker Jase Bolger’s transportation proposal and would raise $195 million.
(2) Repeal Michigan’s Prevailing Wage Laws.
These laws dictate the minimum amount that workers for certain types of public construction projects must be paid. These arbitrary amounts are upwards of 25% higher than amounts paid by the private sector.
A study by the Mackinac Center for Public Policy found that “repealing Michigan’s prevailing wage law would have an impact the equivalent of giving every taxpayer a rebate equal to five percent of his state income tax payments.”
According to an October 2013 report by the House Fiscal Agency, individual income tax revenue is expected to be approximately $8.3 billion for Fiscal Year 2013-14.
If the state realized the savings forecast by the Mackinac Center study it could result in a savings of $415 million that could be reallocated to roads.
(3) Permanently dedicate 1% of use tax revenue to roads.
This is part of Speaker Jase Bolger’s transportation proposal and would raise $239 million.
(4) Redirect Oil & Gas royalty revenue to roads.
In May 2001, the Michigan Natural Resources Trust Fund cap was reached, resulting in $35 million a year in excess funds to be directed to the State Park Endowment Fund and the Game and Fish Protection Fund.
As oil and gas is often transported over Michigan’s roads, this unexpected windfall should be rerouted to maintaining Michigan’s roads.
(5) Competitively bid certain state agency services.
A recent analysis by the Legislature’s House Fiscal Agency identified $2.4 billion in state spending that includes budgetary line items where additional savings could be realized through competitive bidding. A mere 3% in total spending would result in a savings of $72 million.
Additionally, if the Corrections Department’s health and medical services were competitively bid, it could realize a $50 million savings.
Combined, that’s a $122 million savings that could be transferred to roads.
Total savings from just these five reforms: over a BILLION dollars and NO TAX INCREASE!
Does this package of reform proposals solve our road problem? No, but it’s a start. It’s perpetual funding that would help create a long term funding solution for our roads and bridges as well as preserve Act 51.
Speaker Jase Bolger has some good ideas that do not rely on higher taxes. I’ve also offered a few. And there are other legislators who are sharpening their pencils and offering innovative ideas as well.
Other legislators have proposed creative solutions to lower overall transportation costs, provide better value for taxpayers through road construction guarantees, and identify new sources of revenue that do not include higher taxes.
Some of the most creative measures may not have been realized yet. Not a day goes by without constituents suggesting ideas for other reforms in policy and operation of state government, and many of them are quite good.
Raising taxes is seldom their first choice, why should it be ours?
– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – –
Greg MacMaster is State Representative for the 105th District and candidate for the 37th State Senate District, the primary election will be on Tuesday, August 5th, 2014. Learn more about his campaign at; http://gregmacmaster.com/
