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Voters To Decide Fate Of Proposal One And Road Funding

May 5, 2015

Since January, Governor Rick Snyder has been traveling the state with his rock collection – more accurately, hunks of concrete, asphalt, and brick from crumbling roads and bridges.  

“This is a piece of Michigan road,” he says he holds up a chunk of concrete twice as big as his fist. “This is the kind of thing that can fall on your vehicle or go through your windshield. That’s scary folks.”

The governor spent the last full day before voting begins on those scary roads trying to convince voters to support Proposal One.

Voters are about to decide whether to raise Michigan’s sales tax from 6 percent to 7 percent. If they approve Proposal One, that generates $1.3 billion to fix roads and another $300 to $400 for schools and local services. If it’s voted down, Governor Snyder and the Legislature go back to the drawing board. 

Snyder says it’s never easy to ask voters to increase their taxes.

“But it’s for a cause that we all know that we need to do, which is our roads, and we know that this is a lower cost solution than waiting, and a better solution,” he says.

Proposal One raises money for roads primarily by eliminating the state sales tax on fuel, and guaranteeing that every cent collected from fuel taxes at the pump helps pay for transportation and nothing else. It also changes fuel taxes to make them more sensitive to inflationary increases.

“So we’ll pay a higher gasoline tax, but we won’t pay that six percent sales tax at the pump,” says Bob Schneider, expert on Proposal One with the non-partisan Citizens Research Council. He says right now, schools and local governments get a share of the money paid at the pump, so shifting all of that to roads and transportation is a loser for them

Schneider says boosting the sales tax on everything else guarantees that schools and local services don’t get shortchanged.

“Instead of them being revenue losers,” he says, “now they’re revenue winners.”

It also brings the total price tag for taxpayers close to $2 billion. Increasing the sales tax requires amending the state constitution, which requires a vote of the people. 

“We have a state that may be coming out of the doldrums and so what are we going to do? Take more of taxpayers money,” says Tea Party activist Cindy Duran. “It makes no sense.”

Duran says she’s also unhappy with the deals Governor Snyder and Republican leaders made to get the package through the Legislature.

“They had to go over to the Democratic side to get votes because they couldn’t get enough Republican votes, and then they just added all these special things on it.”

Which is true. For example, state House Democratic Leader Tim Greimel says he insisted the proposal guarantee that money earmarked for K-12 schools can’t be used for universities or anything else.

“And constitutionally protect the School Aid Fund from being used as a shell game,” he says. “And it will provide substantial tax relief through the Earned Income Tax Credit.”

The EITC goes to low-income families who will be harder hit by a sales tax increase. The increase is one of the new laws that will be triggered if voters adopt Proposal A.

But Governor Snyder says that deal-making means the proposal should have wider appeal. He says getting the question on the ballot required two-thirds majorities in the House and the Senate, and bipartisan support. 

“I think that’s a sign to say Michiganders can see common ground on how to solve a major problem and I think the outcome was good,” he says.

Snyder says voter rejection of Proposal One would force everyone to go back and start over, , but no other plan has come close to reaching a similar consensus on how to pay for fixing roads. And, Snyder says, he’s not sure another one can.