House Passes $450 Million Road Funding Plan

The House has taken the first step towards fixing Michigan’s dilapidated infrastructure, approving the plan announced by Speaker Jase Bolger last month. The plan initially increases transportation funding by about $450 million next year, and it is believed to provide an additional $500 million annually by 2018.

The most significant change proposed stems from HB 5477, which would eliminate the per-gallon tax on gasoline and diesel. The tax would be replaced by a 6 percent tax on the wholesale price of fuel, which would tie the tax to inflation. The change, which passed 85-24, provides additional revenue from diesel taxation while maintaining the current amount of gasoline tax revenue.

The majority of additional funding is provided by HB 5458 and HB 5492, which shifts $370 million in sales and use tax collected on fuel from the General Fund to transportation. An approved amendment to HB 5492 puts a seven-year sunset requirement on the use tax reallocation. HB 5167 and HB 4251 modify competitive bidding requirements for the Department of Transportation and local road agencies. HB 5452 and HB 5453 increase fines and permit fees for overweight trucks. HB 5460 calls for contractor warranties on state roads and was the only bill in the package to pass unanimously. HB 4630 changes state registration fees.

posted by PAA Online , Friday, May 9, 2014 10:38 AM
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