Snyder won’t take sides on competing GOP road bills
Lansing — Gov. Rick Snyder on Friday refused to publicly take sides on competing road funding plans authored by fellow Republicans in the Legislature as a stalemate continues to linger.
“I’m not going to say I support one plan or the other,” Snyder told reporters after an event in Lansing. “What I’ve always made clear is we need additional revenues. To solely rely on cuts would be extremely difficult.”
The House is in the middle of a four-week summer recess, and senators have not been meeting as they await action by the lower chamber on the $1.5 billion road funding plan they sent representatives earlier this month.
Even though Snyder said he would not “pick favorites,” the Republican governor’s comments suggested he still prefers the Senate plan over the the House’s $1.1 billion package, which relies primarily on growth in existing revenues and budget shifts to close the state’s road-funding deficit.
The House GOP plan generates about $120 million in new tax revenue, primarily through raising the 15-cents-per-gallon diesel tax rate to the same 19-cents-per-gallon rate levied on unleaded gasoline and making the fuel tax adjustable based on inflation.
House Republicans want to divert about $1.04 billion in existing revenue to roads, making a $135 million targeted reduction to the Michigan Economic Development Corp.’s budget, which Snyder has opposed.
The Senate plan hikes both fuel taxes to 34 cents per gallon over a 15-month period to generate about $838 million in new annual tax revenue. The Senate relies on $700 million in unspecified cuts to the $10 billion general fund budget.
On Friday, Snyder opposed a newly formed union-backed ballot proposal seeking to increase the corporate income tax rate from 6 percent to 11 percent to generate $900 million more annually from large businesses to fund road repairs.
Nearly doubling the tax on corporations would be “economically challenging for Michigan,” said Snyder, who championed the corporate income tax rate in 2011.
“Going to 11 (percent) would put us in a very disadvantageous position for job creation in our state,” he said.
House Democrats have proposed hiking the corporate income tax rate to 9 percent.
“I don’t think we should be looking for tax increases in the corporate world,” Snyder said. “But we should be looking at more user fees to help raise dollars for roads and, at the same time, how can we tighten our belt to be even more efficient. We’re run very efficiently today, though.”
Republicans hold a 63-47 advantage in the House over Democrats and have a 27-11 majority in the Senate, giving them the minimum votes of 56 in the House and 20 in the Senate needed to pass a road funding bill.
But Republicans have been divided over raising taxes and what part of the state budget should be axed so existing revenues can be redirected to road repairs.
Snyder did not rule out a road funding plan that would only pass the Legislature with Republican votes “if it works.”
“I try to do everything bipartisan, when possible,” Snyder said. “...I’m really looking for a workable solution.”