Michigan House Republicans introduced a series of road funding proposals this week that they say would prioritize public investment over corporate incentives.
Michigan drivers currently pay two taxes on gas — a flat rate of 30 cents on each gallon that’s adjusted for inflation, and a six percent sales tax, which varies based on current gas prices.
About three-quarters of the sales tax goes to Michigan schools, while the flat tax goes entirely to infrastructure projects.
The Republican plan would establish a single tax that would go toward infrastructure projects, representing about $900 million.
About $1.8 billion in funding would come from the corporate income tax and replacement of a $600 million corporate incentive program.
That allotment would leave Michigan schools about $650 million under current funding levels, which Republicans say would also come from the corporate income tax.
“If you pay sales tax on gasoline or diesel, it should go to road funding. That’s the big part of it,” said Rep. Tom Kunse, R-Clare. “Now we have to be careful, because part of that goes into the general fund, and that funds schools, and that is an absolute red line for us. We are not going to cut school funding, so we’re going to make that whole. We’re going to make schools whole, probably through the corporate income tax. We’re not going to raise it, we’re going to reallocate it.”
In theory, the proposal would not result in increased taxes or a decrease in school funding — but advocates for Michigan’s public schools say that they’d like to see more details on the proposals first.
“I do not believe that there’s a path that involves eliminating sales tax on fuel that is actually going to be revenue neutral and ensure that schools are adequately funded,” said Peter Spadafore, executive director of the Michigan Alliance for Student Opportunity. “You need to find a way to replace that revenue with a stream that is reliable and will be dedicated to school aid fund.”
Democrats have expressed openness to reforming Michigan’s road funding structure, but haven’t addressed the specific proposals put forward.
“I’m glad to see that (Republicans are) thinking about road and transportation funding — I am more than happy to have a discussion with (them) about smart, bipartisan solutions to repair, upkeep, and improve Michigan’s infrastructure,” said Speaker Joe Tate, D-Detroit, in a statement.
Democrats will control the house for another month before handing leadership to the republicans in January, who retook the chamber in the November election.
