Voters to Consider Road Funding Package in May

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In May, Michigan's citizens will decide on a transportation bill that would help close the gap towards funding roadway and bridge improvements throughout the state.  Funding could yield $1.2 billion a year in new funding.

According to MLive reporter Jonathan Oosting:

  • The package proposed constitutional amendment would increase the state sales tax from 6 percent to 7 percent
  • The proposal exempts motor fuel from the sales tax
  • Ensure that the School Aid Fund is not used to supplement higher education budgets.

Lawmakers approved a series of other roads-related bills that would take effect only if voters approve the ballot proposal. Key measures would:

  • Convert existing 19-cent per gallon gasoline and 15-cent per gallon diesel taxes to a wholesale version.

  • Gas taxes could top 41 cents by October 2015, but there would be no additional sales tax, and all resulting revenue would go to transportation.

  • Eliminate some annual vehicle registration fee discounts, increase fees for heavy trucks and create new surcharges for electric and hybrid vehicles whose owners pay fewer fuel taxes.

  • Strengthen warranty requirements for construction projects and require more competitive bidding.

  • Fully restore the state’s Earned Income Tax Credit to 20 percent of the federal level. It was scaled back to 6 percent in 2011.

The ballot proposal and companion legislation could generate more than $1.6 billion a year in extra revenue once fully implemented, according to the non-partisan House Fiscal Agency (http://www.house.michigan.gov/hfa/).

Proposed Ballot Language

House Concurrent Resolution Number 39 recommends potential ballot language for the Board of State Canvassers to consider.

A PROPOSAL TO AMEND THE STATE CONSTITUTION TO ELIMINATE SALES AND USE TAXES ON GASOLINE AND DIESEL FUEL, ALLOW AN INCREASE IN THE SALES TAX RATE, DEDICATE REVENUE FOR SCHOOL AID, AND REVISE ELIGIBLE SCHOOL AID USES.

The proposed constitutional amendment would:

Eliminate all sales or use taxes on gasoline and diesel fuel used in motor vehicles operated on public roads or highways beginning on October 1, 2015;

Allow an increase in the sales tax rate from 6 percent to 7 percent;

Activate other laws dedicating additional revenue for transportation purposes, including repair of roads, streets, and bridges;

Require state funds for school aid to be used exclusively for financial assistance for public school districts, community colleges, and career and technical education and related scholarships; and

Dedicate a portion of use tax revenue for school aid purposes.

Should this proposal be adopted?

YES [ ]

NO [ ]