Finley: Bipartisan roads deal takes shape in Lansing

Nolan Finley
The Detroit News

A new road funding deal is emerging in Lansing, and what sets this latest push apart is that it is coming together with bipartisan backing.

The four Republican and Democratic leaders of the state House and Senate are meeting Tuesday with Gov. Rick Snyder to start hammering out the framework of an agreement in principle that was reached during talks last week.

While details still need to be finalized, the so-called Quadrant leaders, in discussions with Lt. Gov. Brian Calley, have settled on a ratio of $800 million to $850 million of new revenue and $350 million to $400 million in reprioritized general fund spending to deliver $1.2 billion for roads, according to sources who have been briefed on the proposal.

The initial formula calls for a 9-cent increase in the fuel tax, an average hike of $50 per vehicle in the registration fee, bringing diesel taxes in line with gasoline taxes and raising fees and fines on heavy trucks, the sources said.

Optimism is high in the Capitol that the longstanding roadblock on a road funding solution will finally be broken, a sentiment shared by House Minority Leader Tim Greimel, D-Auburn Hills.

“We are as close as we’ve been to a bipartisan deal,” says Greimel, who adds that a number of difficult sticking points still need to be addressed. “I’m more optimistic than I’ve been this term.”

While talks are progressing in the right direction, Greimel said passage of a bill is not imminent; that could take up to a month.

The bill will start in the Senate, where sources say both Majority Leader Arlan Meekhof, R-Grand Haven, and Democratic leader Jim Ananich of Flint have agreed to deliver votes from their caucuses.

Until now, efforts to forge a road deal in this session have been highly partisan, with the GOP trying to pass legislation strictly with Republican votes and Democrats offering their own plan for funding roads by doubling the corporate income tax.

The two sides neared agreement in a brief summer session last month, but it was derailed when Snyder and Democrats tried to attach to it other issues such as a fix for Medicaid expansion funding shortfalls and an end to the petition drive to repeal the prevailing wage law.

This time, the commitment is to produce a clean bill that only addresses road issues, although to get Democratic votes, understandings may have to be reached on those other matters.

The strategy is that by getting bipartisan votes in the Senate, it will put pressure on the House, where opposition by both parties has been more entrenched.

However, in the last go-round, House Speaker Kevin Cotter, R-Mount Pleasant, moved Republicans away from their no-new-taxes position to back a plan for $600 million in new revenue.

Democrats appear now to be backing off demands that business shoulder most of the tax burden. Heading off a drive by unions and other Democratic interests to get a corporate tax hike on the 2016 ballot is a major reason the GOP is willing to consider a fuel tax increase.

Greimel says he still hopes to get a larger share of the new road dollars from corporations, but there are several ways that can be done short of raising the income tax. For example, the money saved by renegotiating MEGA tax credits could be directed to roads.

He also says Democrats want to know what general fund spending will be impacted.

The latest general fund budget already contains $400 million for roads, so it isn’t certain additional shifts will be required.

This new deal does face union opposition that complicates getting Democratic votes. The Building Trades Council, which normally supports anything that leads to more construction jobs, wants Democratic lawmakers to hold out until the effort to repeal the prevailing wage law is dropped.

Republican legislative leaders say the petition drive is a private initiative neither they nor the governor controls.

The United Auto Workers and other public employee unions worry diverting money from the general fund will cost state workers jobs. The unions prefer letting the roads stalemate continue and using it against Republicans in next year’s House elections.

But there is a general sense in Lansing that with gasoline prices dropping, the political consequences of raising the fuel tax are lessened.

There have been false starts toward a deal before, but this time it feels as if the pieces are falling together in a more hopeful way.