Our editorial: Deal to end motorist fees is welcome
Michigan lawmakers gave up on $637 million in revenue it had little hope of ever collecting, and at the same time removed an onerous Granholm-era scheme to boost the budget on the backs of state motorists.
The driver responsibility fees put in place in 2003 to balance a budget never delivered the hoped-for benefit.
Rather than significantly boosting revenues, the fees generated just $35 million to $40 million a year. Most of the fines were never collected.
The budget boost was a small return compared to the damage they did.
The fees, which doubled traffic fines for a number of offenses by reassessing them a year after the ticket was written, saddled motorists with bills they couldn’t pay. And when they couldn’t pay them, the fines were fattened by interest charges making them even more unmanageable.
More than 300,000 Michigan motorists lost their driver’s licenses because they failed to pay the fees. For many, that meant also losing their jobs.
Detroit Mayor Mike Duggan’s administration was among the biggest advocates for ending the fees and forgiving the accumulated debt because of the impact they were having on the city’s workforce. The fees affected an estimated 70,000 Detroiters.
The fees are gone now, along with the debt, but there’s no relief for those who over the years sacrificed to pay the unwarranted fines.
As for the actual stated purpose of the fees — improving safety on Michigan roads — there is absolutely no evidence to indicate they had any impact on accident rates or on compliance with traffic laws.
They were nothing more than a back-door tax by a state government that was unwilling to make hard choices to balance the budget.
In exchange for signing the repeal, Gov. Rick Snyder won support from the Legislature for raising the personal tax exemption to hold state taxpayers harmless from a quirk in the recently passed federal tax relief legislation.
GOP lawmakers had hoped to use the needed state tax fix to force a deeper cut in the income tax. The governor wanted a revenue neutral bill.
Instead, the compromise lifts the exemption to $4,900 over four years, more than the $4,500 Snyder had proposed but less than the Senate had demanded. Cost to the state budget is about $190 million, money that should have gone into infrastructure needs. The average taxpayer will net $153 a year when it’s fully phased in.
But in all, this was a good piece of policy making, ending an unnecessary burden on Michigan motorists while allowing lawmakers in an election year to boast of lowering taxes, without busting the budget.