The transportation funding package Gov. Snyder signed into law on Tuesday brought a disappointing end to the years-long debate over how to raise much-needed funding for Michigan’s transportation system.
The approved package has many serious failures. For example:
- It only guarantees $600 million in new, dedicated revenue for our transportation system—far from the $1.2 billion the package claims to generate. The other half of the funding increase depends on projected general fund growth and relies on future legislators to appropriate that money to our roads versus other priority state programs with growing fiscal needs. It’s far from certain that such revenue growth will occur, or that future lawmakers will come up with the remaining funds when faced with other important demands on the general fund.
- Any money appropriated from the general fund will go to roads only, and will not add to the Comprehensive Transportation Fund (CTF), which supports local bus agencies and passenger rail.
- Furthermore, funding increases will be slowly phased in over the next six years. The short of it: Don’t expect to see major improvements to our crumbling roads and bridges anytime soon.
Still, despite the well-deserved criticism of the outcome, there are a few bright spots worth highlighting:
1. New money for public transit. For the first time since 1987, the CTF will see a structural increase in funding. (By structural increase, we mean an increased slice of the transportation-funding pie. Transit may have seen overall increases in some years, but only because the pie itself grew, due to more fuel purchased or other factors.)
All new revenue from the 20 percent increase in vehicle registration fees and a 7.3-cent increase in the fuel tax (but not the general fund revenue) will pass through the full Act 51 formula, which means the CTF will get its fair share of the funding. In several previous iterations of this package, the CTF was completely cut out of any increase.
The CTF will see $35 million in new funding beginning in 2016. The new revenue will continue to grow through 2021, when the increase levels off at $54.6 million per year—a 22 percent increase over current funding levels. The DNR recreation fund, another pot of money within the Act 51 formula that supports trails and waterways, will grow by $6.5 million per year by 2021.