The House passed
amended versions of the roads package late Tuesday evening, and the package now
heads to Governor Snyder for approval. In a statement on Tuesday night,
Governor Snyder praised the legislature on this $1.2 billion plan and is
prepared to sign the bills.
The package includes HB 4614, HB 4616, HB 4370, HB 4736, HB 4737, HB 4738, and SB 414. This 600/600
proposal generates $600 million in new revenue and $600 million in existing
revenue, mostly from the General Fund, by 2021. With some critics showing
concern for the heavy reliance on the General Fund, Governor Snyder insists the
fund will grow to accommodate the roads, preventing future program cuts.
HB 4616, dealing with
diesel fuels, cleared the Senate 20-18 and the House 56-51. A Senate adopted
substitute generates $200 million from a 20 percent increase in registration
fees in HB 4736. This bill passed the Senate 20-18, and cleared the House
55-54. HB 4738 changes the gas tax from 19 cents per gallon to 26.3 cents per
gallon beginning January 1, 2017. The bill passed the Senate with a vote of
20-18, and the House 55-52. The gas tax and diesel tax increases will begin
January 1, 2022. Inflationary increases are indexed to the national Consumer
Price Index.
HB 4614 applies sales
tax to alternative fuels based on per-gallon equivalent to motor fuels, had no
changes and passed the Senate 21-17 and the House 55-52. The amended version of
SB 414 has the rollback tax occurring when General Fund growth exceeding the
rate of inflation times 1.425. The legislators also compromised to hold off
implementation until January 1, 2023. HB 4370 also did not see many changes,
except for the income multiplier changing from 3.4 percent in tax year 2017 to
3.2 percent in tax year 2018. The measure passed the Senate 28-10 and the House
62-45. HB 4737, dealing with the Michigan Transportation Fund and MDOT, passed
the Senate 27-11 and the House 73-34.
Senator Virgil Smith
(D-Detroit) was the sole Democrat who sided with Republican legislators on any
of these bills.
Senate Minority
Leader Jim Ananich (D-Flint) and House Minority Leader Tim Greimel (D-Auburn
Hills) were particularly critical of this plan. Mr. Ananich called this plan a
“political plan” and doesn’t believe the roads will improve as the years
continue. Mr. Greimel echoed these concerns, adding that, not only does this
further burden families and seniors, but it also will not be implemented until
6 years from now.
Business groups
mostly praised the package, including the Grand Rapids Regional Chamber of
Commerce, the Michigan Chamber of Commerce, and the Small Business Association
of Michigan. The Detroit Regional Chamber and Business Leaders for Michigan
initially opposed this plan, but now offer tepid praise. The Michigan Municipal
League viewed the plan as underwhelming; Karen Holcomb-Merrill of the Michigan
League for Public Policy believes this plan jeopardizes other key services.
Governor Snyder has
said he will take time to read and review these bills, however he is fully
expected to sign them.