Will $1.2B dedicated for MI roads materialize?


LANSING, Mich. (WOOD) — It may seem like ancient history given all the political developments, but just two years ago we were in a full blown argument in this state about how, and even if, we should spend more money on roads and infrastructure.

A big ballot plan, Proposal 1, failed miserably in May 2015, but by November the legislature had come up with a plan to pump $1.2 billion into roads.

Now as the deadline for that cash to materialize draws closer, what will it look like and where will it come from?

This year’s road construction season will bring hundreds of repairs and building projects, both big and small. When it’s all done, there will be hundreds of much needed projects .

More of those may be addressed beginning in the 2019-20 budget when the $1.2 billion in additional funding promised by the legislature will be available, largely for roads and bridges. But will it really be there?

Roughly $400 million will be generated from the gas tax going up 7.3 percent. Another $200 million will be generated from increased registration fees. Those dollars have already started to flow. The rest will come from existing tax revenues and another $600 million out of a $54 or more billion budget.

Piece of cake, right? Maybe, maybe not.

Recently, state Rep. David LaGrand, D-Grand Rapids, said he was not very confident the $600 million is going to be there when it comes time to pay up. But he is far from the only person to wonder if the cash will be there when it’s time for the rubber to meet the road.

The money actually comes from a much smaller pot. It’s called general fund, general purpose and will rely on the discipline of future legislators to make the promise a reality. This year that part of the budget is about $10 billion, but that money pays for a lot of what we know as government.

Forty-four percent goes to health and human services spending. Corrections, higher education and Michigan State Police make up another 37 percent.

After debt service and a small amount to the School Aid Fund, there is 12 percent or about $1.2 billion left in the fund in this year’s budget.

By 2021, $600 million of that is supposed to go to roads.

When asked if we as a state can get to that level of financing, the state’s budget director said he is confident.

“I think we can, but one of the things I think I’d like to see us do, maybe even starting this year, is let’s take a look at some of the money we’re saving in this year’s budget. We know we’ve got some one-time funds, we could actually use some of that money to prefund or start prefunding that road work,” he replied.

In other words, Al Pscholka, former chairman of the House Appropriations Committee, says that careful budgeting will be needed to fulfill a promise he and his colleagues made when he was still in the House in 2015.

Pscholka’s replacement as chair of Appropriations, Livonia Republican Rep. Laura Cox, is aware of promises made.

“Any good appropriator looks outward. We may look sometimes up to five years ahead so those are the kind of things that we’re looking at,” she told 24 Hour News 8.

Something else the legislature and appropriators may also be looking at long term is tax reduction. That’s something Cox says she would like, and her colleagues made it their first priority when they tried and failed to pass what would have been a $1 billion cut to the general fund by rolling back state income taxes.

While one Lansing insider says they believe “that train has left the station,” others seem intent on doing something to reduce taxes. That will all figure into the equation on roads.

Republican Gov. Rick Snyder thinks the money will be delivered.

“Yes, it should be. That’s the whole point of what we did,” he told 24 Hour News 8 when asked.

In fact, most of the lawmakers and others 24 Hour News 8 spoke to think the money will be fully in place by 2021, and some are making plans either way.

No one is watching the process with more interest than Michigan Department of Transportation chief Kirk Steudle.

“We’re building our five year plan as if it’s there because if it’s not there, then we start taking out projects. It’s just that simple. That’s half of what the increase was all about and if it’s not there, it will have an impact. There will be projects that are just line itemed out,”  the MDOT director said.

If that cash, or most of it, is delivered to MDOT, counties and others to work on roads — it will still be far from enough, according to a new infrastructure study done for the state.

The question of more money for roads, bridges, sewers, water systems and even Wi-Fi coverage are all likely to come up in the years to come.