AASHTO Journal, 19 December 2014
Gov. Rick Snyder explains transportation revenue proposal.“Nobody likes our roads,” Michigan Gov. Rick Snyder told a Dec. 18 news conference as he unveiled a $1.3 billion, multi-part transportation funding proposal with legislative leaders that could see voters decide next May whether to hike the statewide retail sales tax.
Early the next morning the state Senate followed the House in giving the package the necessary two-thirds approval to put it before voters in a ballot measure.
The plan would also put in place a wholesale percentage tax on motor fuels. The legislature passed a series of related funding bills that would only take effect if voters next spring approve the core provisions to raise the retail sales tax to 7 percent from 6 percent now and eliminate the current fixed sales taxes on gasoline and diesel fuel.
Snyder said the fuel tax changes would in effect hike the state tax portion of pump prices by about 3 cents a gallon, effective next October.
The plan would raise about $95 million through changes in vehicle registration fees, of which $50 million would come from heavy trucks and some would come from new fees on electric and hybrid vehicles.
The result would be $1.2 billion in new annual revenue for roads and bridges, he said, and $112 million for transit and rail programs.
The state Senate and House earlier passed sharply different types of funding plans, while Snyder and Michigan Department of Transportation Director Kirk Steudle launched a messaging campaign to build public support for higher revenue.
After Snyder and the legislative leaders announced the plan they had negotiated, it took the rest of that day and all night to get it through both chambers early Dec. 19, with the Senate narrowly backing it while it easily passed the House.
The Detroit Free Press also reported that the upcoming campaign around the May ballot initiative “is expected to have deep-pocketed backers on both sides.”