Proposal sends all taxes paid at the pump to fix local roads
State Rep. Rodney Wakeman, of Saginaw Township, recently announced his support for a common-sense, bipartisan reform to help fix crumbling local roads and bridges without a tax increase.
The proposal would eliminate the sales tax on fuel and replace it with an equivalent, revenue-neutral tax on fuel dedicated solely to roads. This would dedicate roughly $800 million more per year to road repairs without raising taxes, an effort Wakeman said respects the needs of Saginaw County families.
“This is a solution that the residents of my district are not only looking for, but deserve,” Wakeman said. “Instead of the governor’s bonding scheme that puts Michiganders $3.5 billion in debt, primarily helping families in the metro Detroit area, we’re making sure rural communities across the state will receive road repairs without a tax increase.”
The legislation would ensure all revenue collected by the replacement tax at the pump is dedicated specifically to local road funding. The governor’s financing option specifically excludes local roads.
“Residents in Saginaw County have reached out, pleading for repairs for the local roads they take to school, work, and other daily commutes,” Wakeman said. “This reform will not only benefit residents in our communities, they won’t be required to pay the astonishing price like they are forced to with the governor’s bonding plan.”
The governor’s proposal took on $3.5 billion in new one-time debt to be spent only on state-owned roadways, which make up only about 8 percent of Michigan roads. Wakeman said the revenue-neutral plan will instead result in approximately $800 million annually in additional funding for the other 92 percent of roads that connect driveways to highways, which the governor blocked in her lopsided plan.
The proposal also requires the state treasury to backfill the school aid fund with income tax revenue – eliminating any chance of financial losses for schools.
The measures now move to the House Appropriations Committee for consideration.