Michigan road funding talks see progress

Gary Heinlein
Detroit News Lansing Bureau

Lansing — The path of Michigan’s road and bridge repairs will likely be decided Wednesday after legislative leaders couldn’t agree Tuesday evening about how to increase annual funding more than $1 billion.

Legislative leaders and Gov. Rick Snyder said Tuesday progress was made as they tried to reach a compromise as the Legislature’s Thursday adjournment looms. House Minority Leader Tim Greimel of Auburn Hills said there is an “outline” for a possible agreement, but a deal will have to be completed Wednesday.

House Speaker Jase Bolger, R-Marshall, was noncommittal but seemingly optimistic about finding $1.2 billion more annually for road and bridge repairs in Michigan.

“We continue to work,” Bolger said following a late Tuesday afternoon meeting. “We continue to make forward progress.”

The legislative leaders left the meeting at 7 p.m. They wouldn’t talk about specifics, but negotiations seem to have stumbled on how much of a tax increase legislators are willing to support.

After the meeting broke up, Snyder also told reporters he and lawmakers seek “a balance” that will raise an additional $1.2 billion annually without raising taxes or fuel prices too much, and without being unfair to some constituencies such as low-income residents.

“Obviously, some feel certain constituencies are more important,” he said.

Snyder said he’s concerned about the approaching Thursday deadline for the Legislature’s adjournment but repeated his mantra about “relentless positive action,” and said there is still a good chance for a long-range solution to Michigan’s road-funding challenges during the next two days.

Snyder backs the Senate-approved plan that is estimated to double taxes at the fuel pump during the next four years and generate $1.2 billion annually in four years. It would replace the 19-cent-a-gallon tax with a percentage wholesale tax starting at 9.5 percent and rising in stages to 15.5 percent by Jan. 1, 2018.

Bolger has pushed his House-passed plan to raise the $1.2 billion without a tax hike, but the idea of dedicating the sales tax on fuel to roads raises an arguable level of risk to school and local government funding from the state. Bolger spokesman Ari Adler said the speaker is willing to negotiate on the Senate-passed plan.

But Democrats, Senate Majority Leader Randy Richardville and Snyder have qualms about Bolger’s plan.

After a Tuesday morning meeting, Richardville, R-Monroe, said the group “lit a fire” but offered no specifics. He said talks have moved toward a blend of the two major road funding plans.

“There isn’t any plan that started out in the beginning that’s still being considered as a plan,” Richardville said. “Everybody’s looking at everybody’s (proposals) and kind of merging them into one. It’s more like that than this plan versus that plan.”

Bolger’s office defended the speaker’s plan.

“Speaker Bolger agrees with the other legislative leaders and the governor that a target of $1.2 billion in road funding is needed to address decades of failing to address this problem,” Adler said in a missive to the press Tuesday. “However, the House has shown that Michigan can achieve $1.2 billion in additional road funding while increasing taxes by $0.”

The House plan gradually would dedicate revenue from Michigan’s 6-percent sales tax on fuel purchases to road repairs. Fiscal analysts project that would raise more than $1.2 billion by sometime between 2020 and 2023.

But opponents say the House plan takes too long to generate the additional revenue. Democrats say it also risks school and local-government funding, which currently get nearly all of the revenue from the sales tax on fuel.

The House plan foresees increasing revenues from other tax collections making up the difference as Michigan’s economic recovery gains momentum. But it also call for legislative budget adjustments, if necessary, to hold cities and school harmless.

gheinlein@detroitnews.com(517) 371-3660