Michigan Senate budget boosts roads, but short of Whitmer plan

LANSING, Mich. (AP) — A Republican-led legislative panel approved a transportation budget Tuesday with a $132 million boost in road spending, far short of the roughly $2 billion net increase Gov. Gretchen Whitmer is seeking over two years through a 45-cents-a-gallon fuel tax hike.

Under the Senate plan, 2015 road-funding laws would be fully phased in during the next fiscal year — a year early — by more quickly shifting earmarked general funds to road repairs. GOP senators plan to wait until the summer to consider if new tax or fee revenue is needed to fix deteriorating roads and bridges, separate from the budget process, setting up a potential standoff with the Democratic governor. Republican leaders have previously rejected the 45-cent increase as too much.

“It’s money we don’t know that we’ll have,” Sen. Wayne Schmidt of Traverse City, chairman of the Senate’s transportation appropriations subcommittee, said when asked why the Senate is not tying the budget with broader road-funding talks. He was among five Republicans to back the bill. Two Democrats opposed it.

“I think they’re being chicken. I really do,” Sen. Rosemary Bayer, of Beverly Hills, said of GOP senators waiting to propose an alternative to Whitmer’s plan. “They’re taking the cowardly way out. They’re trying to avoid this, the fact that we need to raise money.”

The vote was legislators’ first on the budget since the new governor proposed her overall $60 billion spending plan in March. Senate panels will take additional votes this week. Republican-controlled House committees have no firm timeline for voting. The next fiscal year starts in October. One reason the Senate is delaying action on a more robust transportation-spending plan is to buy time while it considers ways to lower Michigan’s highest-in-the-country auto insurance premiums.

Whitmer vowed a veto if the Senate transportation plan reaches her desk as is.

“The governor stands ready to work with the Legislature, but the Senate budget passed today won’t do anything to actually fix the roads and could actually make things worse,” said spokeswoman Tiffany Brown, who called Michigan’s roads the worst in the U.S.

Whitmer’s plan would hike the 26-cents-a-gallon gasoline and diesel taxes by 15 cents in October, an additional 15 cents in April 2020 and a final 15 cents in October 2020 — making Michigan’s fuel taxes the highest in the nation. It would generate $2.5 billion annually once fully implemented, including $1.3 billion in the 2019-20 budget year. The net revenue increase for transportation would be around $2 billion, however, because she wants to end the earmarking of income taxes for roads — a trend that began earlier this decade.

Whitmer warns that without additional investment, the percentage of state-owned highways that are rated poor will double in five years, to 44%. Local roads are in worse shape.

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