The House Transportation Committee began taking testimony on Speaker Bolger’s plan to raise $450 Million dollars for roads. Offering testimony today was MDOT, Michigan Building and Construction Trades Council, and the County Road Association of Michigan.
The plan focused on four specific subject areas: increasing efficiencies, improving quality, improving fairness and investing current resources. That’s different from other plans that have focused on tax increases to improve the state’s roads.
The proposal includes ending the 19 cents per gallon tax on gasoline and 15 cents per gallon tax on diesel fuel and replacing them with a 6 percent tax on the price of fuel at the wholesale level. This would be a revenue neutral change for gasoline and raise $47 million in new revenue from those buying diesel fuel.
The proposal also includes efficiency measures such as more competitive bidding for local road agencies and the Department of Transportation, and would require that warranties on construction and preservation projects.
The plan would also increase fees on permits for overweight and oversize trucks, a move that would raise $4.5 million
Finally, the plan would use General Fund dollars generated from the use tax and the sales tax collected on gas and diesel at the pump, and dedicate those dollars to roads. This would generate $379 million.
The committee will continue to take testimony on Thursday (5/1). The League will be offering testimony thanking the Speaker for beginning the discussion on increasing road funding but that further work needs to be done on the proposed legislation to ensure a long-tern solution.
John LaMacchia is a Legislative Associate for the League handling transportation and infrastructure issues. He can be reached at [email protected] or 517-908-0303.