Bills devote all taxes paid at the pump to county, city and village roads

State Rep. Julie Calley today voiced her support for a common-sense reform that would help fix crumbling local roads and bridges without a tax increase.

The proposal, included in House Bills 5582-85 and 5587-88, 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.

The legislation also includes strict protections to ensure schools are not hurt from the change.

“The taxes we pay at the pump should go to fix the roads – it’s plain and simple,” said Calley, of Portland. “The legislation makes this common-sense reform while also giving our local road agencies the boost they need to fix the roads we drive every day on our way to work, school and the grocery store.”

Under the legislation, Calley said all revenue collected by the replacement tax at the pump would be dedicated specifically to local road funding – filling a gap left behind in the governor’s road bonding scheme. The administration’s proposal took on $3.5 billion in new one-time debt to be spent on only state-owned roadways, which are about 8% of Michigan roads. This revenue-neutral plan will instead result in approximately $800 million annually in additional funding for the other 92% of roads that connect driveways to highways in every corner of the state.

The proposal was referred to the House Appropriations Committee for consideration.

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