Advocacy News – Nov. 26, 2024
What’s new: Michigan House Speaker-Elect Matt Hall last week proposed increasing road funding by $2.7 billion by earmarking nearly all revenues generated by the Corporate Income Tax and directing all revenues generated at fuel pumps to roads.
- Republicans previously floated a similar plan in 2019 that was ultimately unsuccessful. They now believe, since the General Fund has grown by as much as 40% since then, it is time for a renewed push.
- Critics have voiced concern that the proposal puts at risk funding currently being used for the state’s economic development fund, also known as the SOAR program, or potentially the School Aid Fund.
- Hall and other Republican leaders voiced a willingness to negotiate, and it is yet to be determined if the plan will gain traction.
Why it matters: Michigan’s chronic underfunding of road maintenance and rebuilding has led to Michigan having some of the worst transportation infrastructure in the country. While bonding and federal funding have helped in recent years to mitigate a bad problem from getting worse, those funds are quickly running out and the state faces a significant funding shortfall, or fiscal cliff, for road funding going into 2025 and 2026.
What we’re saying: The Michigan Chamber has continued to call for a long-term road funding solution. While there are many revenue streams and efficiencies that could be identified to resolve this problem, fundamentally lawmakers from both sides of the aisle must come together to agree on a sustainable, long-term strategy.
What’s next: There are several ways to get road funding right, but there are many ways to get it wrong. Some proposals that have been floated in the past that could result in disproportionate additional costs to the business community.
Addressing regulatory barriers through solutions like streamlining aggregate mining permits could also help stretch taxpayer dollars farther.
- The Chamber will continue to urge lawmakers to be solutions oriented and come up with a pragmatic, cost-effective plan that works. Lawmakers have long talked about the need for a more sustainable road funding solution but have yet to come to an agreement.
For more information, contact Mike Alaimo.