Snyder, leaders agree to add $287M more for roads

Chad Livengood, and Gary Heinlein

Lansing — Gov. Rick Snyder and Republican legislative leaders have agreed to pour an extra $287 million of surplus tax revenue into road repairs next fiscal year.

The Republican governor and legislative leaders set fiscal year 2016 spending targets Wednesday in a deal that dedicates $400 million toward transportation projects from the $9.5 billion general fund, said Kurt Weiss, spokesman for the state budget office.

About $113 million of that sum was already budgeted by the governor, House and Senate to match the federal government's contributions to Michigan's fund for highways and bridges, Weiss said. The tentative budget deal also calls for public universities to get a 1.5 percent increase in state funding next school year, he said.

"By increasing our investment in our infrastructure and education, we're investing in Michigan's future," Snyder said in a Wednesday statement. "This is essential work to keep our economy growing stronger and improving the quality of life for all Michiganders."

At last Friday's state revenue estimating conference, the chairmen of the House and Senate appropriations committees said they hoped to spend all or most of any extra General Fund revenue on roads and bridges, not mass transit or airport projects that also are part of the transportation budget.

But Sen. Goeff Hansen, who heads the Senate's appropriations transportation subcommittee, said lawmakers still were working out the details on Wednesday. Hansen, R-Hart, said he hoped to finalize the transportation budget in a Thursday conference committee meeting.

"My own preference would be to make this all for roads," he said.

The extra $287 million for road repairs is considered one-time revenue from temporary changes in tax revenue forecasts, Weiss said.

Snyder has insisted that the Republican-controlled Legislature raise new dedicated tax revenues for roads after voters defeated the Proposal 1 sales and gas tax increase on the May 5 ballot.

"A long-term solution, obviously, is still needed," Weiss said Wednesday.

In recent years, the Legislature has shored up the $3.7 billion transportation budget with general tax revenue because of declining gas tax revenue.

From 2004 to 2013, gas tax revenue dropped nearly 12 percent, leaving state and local road agencies with $110 million in less annual funding, according to data from the Michigan Department of Transportation.

State economists and budget officials agreed Friday that tax revenue collections will be $217.6 million higher this fiscal year than previously estimated in January.

Tax collections for the 2016 fiscal year, which starts Oct. 1, are projected to be $147.8 million higher than expected, giving lawmakers an extra $365.4 million to divvy up in the coming weeks.

Republican legislative leaders hope to complete the 2016 fiscal year budget by mid-June.

The Michigan Infrastructure and Transportation Association has led the private sector push for at least $1.2 billion more each year in spending to fix roads and bridges in Michigan.

"It's a step in the right direction," said Mike Nystrom, the association's executive vice president.

"As the discussion continues toward finding a long-term solution (for road funding shortfalls), this is a good step toward getting some improvements right away," Nystrom added. "The industry is ready to get to work fixing our infrastructure."

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