Rep. VanSingel offers his take on the bond proposal
Governor Whitmer delivered her state of the state message last week. Much of the focus was on her plan to fulfill her campaign promise to ‘fix the damn roads’.
She unveiled a $3.5 billion bond proposal that would bypass the legislature who turned down her initial proposal to raise the gas tax by 45 cents a gallon.
From her speech:
“Our roads are dangerous, and the longer we wait, the more expensive it will be to fix them.That’s why I’m taking action now to fix the damn roads and keep Michiganders safe. My Rebuild Michigan plan will ensure we start moving dirt this spring and save us money in the long run. But if we’re going to fix all the dangerous roads in Michigan, Republicans need to step up and get serious about finding a long-term road funding solution for our local roads and bridges. I’ll work with them when they’re ready, but in the meantime, I’m going to get to work fixing our state roads on my own.”
The roads getting fixed under the governor’s plan will be high volume freeway and non-freeway roads with the greatest economic impact and more average passenger vehicles per day.
A press release from CRAM (County Road Association of Michigan) indicates less than enthusiastic support from the organization:
The County Road Association of Michigan has called any road funding solution that does not provide additional dollars for local roads a woefully incomplete answer to the situation with Michigan roads.
“While not in a position to evaluate what is widely expected to be $3-plus billion in bonds for state trunkline projects – which comprise a mere 8% of Michigan’s road network – this actionable proposal from the Governor entirely leaves out the local and primary road network,” said Denise Donohue, director of CRAM, whose members are the 83 county road commissions and departments across the state.
N3 asked State Representative Scott VanSingel for his reaction to the bonding proposal.
"I was both encouraged and disappointed by the governor's state of the state address Wednesday. The governor and I share a common interest in improving and expanding education in Michigan, particularly her goal of reaching a workforce in which 60% of adults have a college degree or certificate. As chairman of the Higher Education committee in the House of Representatives, I have personally pledged my support to help reach this goal. Unfortunately, the governor's willingness to work with the legislature to obtain our shared goals seems to end there.
“Michigan was hit particularly hard during the last recession and was in very poor financial condition. We have spent roughly the last 10 years trying to dig out of debt, rebuild our rainy day fund, improve our badly neglected infrastructure, and in general improve our state's financial condition. The governor's proposal to borrow $3.5B by issuing bonds reverses this course and furthermore undermines the checks and balances on the branches of government as it is being done without any input from the legislature.
“While nearly all of us agree that more money is needed for road repairs, it is essential that the funds be invested in an equitable manner, that is distributed around the state fairly, and that we pay for these repairs in cash. Under the current proposal very little if any of this money will be spent in this district. Furthermore, borrowing money for a depreciating asset is rarely a good idea. When these bonds are fully issued, roughly $300M annually will be pulled out of the transportation fund for the next 25 years to service the debt. This is $300M annually which will no longer be going to roads and a total of roughly $7.5B in payments for $3.5B in work. Many of these roads will likely need major repairs again before the debt is ever repaid.
“As a general rule it is best not to criticize a plan unless we have a better idea. While there is probably not a perfect or painless plan, there have been ideas presented by the legislature which are a starting point and would inject a significant amount of money into roads with existing funds. There is currently approximately $800M in unspent funds in the general fund which could be appropriated for road repair. In addition, the House has proposed that the 6% sales tax on gas all go to roads, (it currently does not). This would add approximately $900M more annually to road repairs if we can find a plan to backfill the lost sales tax revenue so schools are not impacted. This is close to the amount of revenue the proposed bonds will generate over the next 3 years.
“I will continue to work with the governor and leadership in the House to develop a meaningful and fair road plan which is fair to rural residents and adequately addresses the problem. Michigan has come a long way in the past 10 years and I'm confident our best years are yet to come."
Note: State Senator Jon Bumstead previously weighed in with a column in our Pulse section entitled “A Step Backward for Michigan.”
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