By Dave Murray
Jackson Citizen Patriot
March 27, 2012
A portion of the sales tax would be earmarked for the state’s crumbling roads if a bill that cleared the state Senate Tuesday becomes law.
Senators overwhelmingly approved a plan to take a part of the 4 percent sales tax that now heads to the budget’s general fund and earmark it for roads with an eye toward landing more federal matching funds.
State residents pay a 6 percent sales tax, with 2 percent headed directly to the school aid fund and the rest is divided to other areas of the budget, including revenue sharing to municipalities.
Sen. John Proos, R-St. Joseph, said the plan would designate more money for roads without raising taxes at a time when families are struggling with high pump prices.
“Instead of it going to the general fund, which can be used for any number of priorities including overspending in the Department of Corrections in the last few years – of which that budget I chair – I’d rather see us do right by our constituents who believe that what you pay at the pump, those dollars go to roads.
Proos said the change would claim about $135 million for the roads from the general fund. Gov. Rick Snyder’s budget proposal already targets $119 million in general fund money for road projects, but Proos said that is intended as a one-year plan.
He’d rather not use Snyder’s recommendation, leave the $119 million in the general fund and come with other cuts to cover the $17 million gap.
Snyder has said it will take about $1.4 billion to maintain roads, and more for new projects, and has called for lawmakers to look at a variety of ways to raise money.
Revenue from a per-gallon gas tax and vehicle registration fees have dropped because the state has fewer drivers, and people still on the road are driving less and have more fuel-efficient cars.
That means there is less money available for repairs. The Senate Fiscal Agency points to reports that 28,000 miles of state and local roads in poor condition.
Senate leaders have floated the idea of a higher gas taxes, and Sen. Howard Walker has pushed the idea of a 1 percent increase on the sales tax dedicated to roads.
“Folks are having trouble with their own current state in life, and now they can’t afford to get to work. When see gas prices in Southwest Michigan at about $4.15 and going up, we have to question whether people can afford any tax increases,” Proos said.
But he said Walker’s proposal “makes some sense,” saying revenue will be boosted as the economy grows.
“These are tough issues, especially at a time when our schools are seeing the number of students in free or reduced-price lunch increasing on a daily basis, more and more kids coming in for breakfast, that’s indicative of our economic situation in Michigan,” Proos said.