Posts from the ‘transportation’ Category

Less than stellar state transportation funding outcome has 3 bright spots

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.

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Transportation funding: An exciting future is within reach

Editor’s note: This is the third and final post in a series on transportation funding leading up to the May 5 special election. Read the previous installments here and here.

A lot of what you’ve read about Proposal 1 has probably been about the price Michigan is paying today for our history of inadequately funding our transportation system. Past mistakes—like our flat-rate fuel tax that hasn’t kept pace with inflation—have left us with roads so bad that many local governments are opting to turn them back into gravel, and “structurally deficient” bridges that, in some cases, you can see right through.

It’s all been pretty gloomy. That’s why we wanted to end this series on a hopeful note by offering some glimpses of what Michigan’s transportation future can look like if voters approve Proposal 1. Yes, it will take some time to address the backlog of projects needed to get our infrastructure back in decent shape. But before long, the new funding will support exciting projects that will ultimately add up to the 21^st-century transportation system Michigan needs.

Playing catch-up

Roads and bridges are crucial pieces of that system, no doubt. But MEC’s transportation focus is on the environmental, social and economic benefits Michigan will enjoy from improved and expanded passenger rail, public transit and complete streets that address the needs of all users. If Proposal 1 passes, those pillars of our transportation system will see a $116 million annual funding increase.

That sure sounds like a lot, but what does $116 million really get us? Well, to put it in context, the entire startup cost of the planned WALLY commuter rail line from Howell to Ann Arbor is $30 million, plus about $5 million a year to operate the service. The influx of new funding will help get WALLY and similar projects off the ground sooner by providing the matching funds needed to unlock significant federal grants.

Of course, public transportation has a lot of catching up to do in Michigan, since it hasn’t seen a structural funding increase in nearly three decades. Like our roads, public transportation is crumbling in many communities. Some local bus agencies are reducing service and even eliminating routes.  So in addition to launching new projects, Proposal 1 would strengthen the foundation of our public transportation network with basic improvements to existing services. A large portion of the new revenue would support local bus operating expenses, which could mean that transit service in your community extends service hours, increases frequency or provides additional route options.

That’s important, because people all over Michigan depend on public transit to accomplish the basic tasks of daily life. It’s how many rural residents get to the grocery store. Seniors and people with disabilities take buses to the doctor’s office or to visit family members. In some urban districts, public buses are the only way for kids to get to school. Without transit, many of our friends and neighbors couldn’t get to the college classes or job interviews that will bring their families new possibilities and stability. The 260,000 rides Michiganders take on public transit every day are essential gateways to opportunity for economic advancement.

Research shows good transit is increasingly important for attracting young talent.

On track to prosperity

The benefits of these investments will extend beyond the day-to-day convenience and access to opportunities they provide for millions of Michiganders, though such benefits are significant. Whether or not we build a modern, complete transportation system will be a deciding factor in Michigan’s economic competitiveness. Report after report tells us that Americans across all age groups are looking for more and better options for getting around. Millennials are getting their licenses and owning cars at ever-decreasing rates. Baby boomers are rethinking the auto-centric lifestyle they grew up with and moving away from car-reliant suburbs. Cultural shifts among these two huge demographic groups demand that we think about our transportation system in a more comprehensive way if we want to attract and retain talent and improve quality of life for everyone.

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Transportation funding: Here’s what Proposal 1 does (and why it’s good for Michigan)

Editor’s note: This is the second in an occasional series on transportation funding leading up to the May 5 special election. Read part one here.

In our first post in this series, we explored the factors—changing driving habits, fuel taxes not keeping pace with inflation, more fuel-efficient vehicles—that have left Michigan and other states hurting for dollars to maintain transportation infrastructure.

In this post we’ll dive into what Proposal 1 would do to begin addressing that shortfall. We’ll warn you right now, folks: This is gonna get pretty wonky. But we think it’s important that voters really understand what’s on the ballot in May, so we’ll do our best to be both thorough and readable.

First, we need to understand how we currently fund Michigan’s transportation system. And as you’ll see, for all the talk by its opponents of how “complicated” Proposal 1 is, it’s not as if our current system is the model of elegance.

How transportation funding works today

The bulk of our transportation dollars comes in roughly equal proportion from two main sources: First, there’s the motor fuel excise tax—19 cents per gallon on gasoline and 15 cents per gallon on diesel—that we all pay at the fuel pump.  Second, there’s the vehicle registration fees we pay at the Secretary of State’s office. The motor fuel excise tax is a flat tax, meaning that it does not react to price inflation—we pay the same amount whether gas costs $1.50 or $3.50.

About half of our transportation funding comes from the federal government. In recent years our transportation shortfall has been so significant that we’ve had to tap Michigan’s general fund—basically the state’s main checking account—just to meet the match required to be eligible for those federal funds. That money all pours into the Michigan Transportation Fund, the bulk of which pays for roads and bridges. The transportation fund also supports public transit and directs money to the Recreation Improvement Fund, which supports trails, waterways and other outdoor amenities that make Michigan a great place to visit and explore. Read more

Transportation funding: How’d we get here?

The package of transportation-funding bills Gov. Snyder signed  earlier this month sets the stage for a ballot initiative with high stakes for drivers, transit riders and Michigan’s economy.

Voters in May will have their say on a proposed 1 percent increase in the state sales tax. Along with $300 million per year in new school funding, the proposal would raise about $1.2 billion a year for roads and at least $107 million annually for the Comprehensive Transportation Fund, which supports maintenance and upgrades to public transit and passenger rail. If approved, it would be the state’s first structural increase in funding for public transportation since 1987.

Like many Michiganders, we would have preferred a full solution from the Legislature, rather than facing the added cost, delay and uncertainty a ballot initiative adds to the process. But a ballot drive is what we’ve got, and MEC fully supports its passage.

In the run-up to the May vote, we’ll use this blog to take a close look at Michigan’s transportation system and to make our case that supporting that system in its entirety—not just roads and bridges—is essential to our state’s quality of life and economic competitiveness.

In this first installment of an occasional series, we’ll explore how Michigan arrived at such a desperate need for new transportation funding, and show we’re far from alone in that need.

How we got here

It only takes a few minutes behind the wheel on most Michigan roads to see how badly we need new transportation revenue. (Drive down Pine St. in Lansing from MEC’s offices to I-496. We dare you.)

What’s going on here? Why have the roads gotten so bad? Read more

Time is right—but running out—for transportation funding deal

Michigan’s legislature has one week left before the summer recess. With the Detroit aid package finalized and a budget agreement shaping up, lawmakers face just one major hurdle before they head home to reconnect with their constituents.

Doubt is growing in Lansing about whether legislators can agree on a transportation funding package before the break. While they could take the issue back up in the fall, we believe the leadership in the Capitol must hammer out a deal immediately.

Here are a few reasons they need to get it done now: Read more

Long track record, millage victory make Ford solid choice as RTA chief

MEC applauded the unanimous vote Wednesday by the board of the Regional Transit Authority of Southeast Michigan to hire longtime transportation administrator Michael Ford as its new CEO.

Ford previously held leadership positions with transit authorities in Stockton, Calif., Portland and Seattle. All told, he has 35 years of experience with public and private transit institutions, from working as a bus station custodian in college to serving a management role with Greyhound.

Perhaps the deciding factor in the nine-member board’s selection of Ford was his success in his current role at the helm of the Ann Arbor Area Transportation Authority. Ford is still employed by AAATA and has not yet confirmed that he will accept the RTA offer.

Ford is fresh off a major win at AAATA, where he helped to gain 71% voter approval this month for a new millage that will expand transit service by 44% in Ann Arbor, Ypsilanti and Ypsilanti Township. Rigorous planning, communications and public engagement were major factors in that decisive victory.

With its own millage campaign set to culminate in November 2016, the RTA stands to benefit from Ford’s experience in Ann Arbor, said MEC President Chris Kolb.

“Michael Ford has proven he has the right set of skills to demonstrate to community members that better public transportation creates a stronger region with more opportunities for residents,” Kolb said. “I’m confident his strong leadership will help the RTA fulfill its potential as a transformative force for Metro Detroit.”

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MEC releases report exploring mileage fee to fund transportation system

MEC today released a report that explores the possibility of funding Michigan’s transportation system by charging motorists based on the distance they drive.

One key advantage of a mileage fee is its fairness, the report says. The damage a vehicle does to roadways depends on how far it travels and how much it weighs, both of which can be accounted for in a well-designed mileage fee.

Another benefit is that charging per mile avoids one of the pitfalls of Michigan’s current per-gallon tax on gasoline: As vehicles become more fuel-efficient, revenue from that tax will continue to shrink. By charging based on distance driven rather than fuel burned, a mileage fee could provide a more stable source of funding for our transportation system.

Oregon already has begun implementing a limited mileage fee policy, and other states—including Texas, Minnesota, Florida, Iowa, Wisconsin and Nevada—have studied it as a funding option.

Of course, as a Detroit Free Press story on the report noted, privacy concerns and other hurdles would have to be cleared before such a system could be implemented. But MEC President Chris Kolb said having a discussion now will help Michigan establish a transportation-funding mechanism that is fair, efficient and sustainable in the long run.

“We think a mileage fee is worth examining as a potential future revenue source for our state’s transportation system,” he said. “Implementing the fee would likely take the better part of a decade, so it makes sense to start the conversation and see if it’s the right fit for Michigan.”

As a world leader in automotive technology, Michigan is a natural fit to develop the technology and policies a mileage fee would require, Kolb added.

MEC commissioned the report from SMART, a transportation research initiative at the University of Michigan. The two groups held a briefing on the report this morning in Lansing, followed by a panel discussion featuring Kirk Steudle, director of the Michigan Department of Transportation; John Austin, nonresident senior fellow with the Brookings Institution; and Conan Smith, executive director of the Michigan Suburbs Alliance.

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Photo courtesy Chris Chan via Flickr.