Voters to decide on tax increase

Local government leaders hope Proposal 1 passes next Tuesday, but community support is harder to find.
An informal Facebook poll resulted in two “yes” votes and 38 calls to reject the proposal, many emphatically.
‘Voting ‘no’ ? higher taxes with little increase in road funding,” posted Martin Rathsburg. “If the whole tax increase went to road funding then maybe there would be a chance. No money goes for road repair for the first two years. How dumb does (Governor Rick) Snyder think the public is??
‘The pump savings won’t be a net savings by the formula until gas is over $4 a gallon,” said Jason Gault. “The money will only be used to pay down debt for the first two years. Voting for a lousy plan only due to lack of alternatives is bad business.?
‘Without developing a plan to the long term issue of road longevity I am a firm ‘no,'” said Kris Walker. “While the 6 to 7 percent tax change does not seam like a lot, it is actually a 16 percent increase.?
Independence Township Supervisor Pat Kittle said area roads need to be fixed immediately, and supports the state-wide issue.
‘I’m scared of what will happen if Proposal 1 does not pass because our roads are in such bad shape,? Kittle said. ‘Proposal 1 is the best solution.”
He strongly favors it because it would fix roads and increase revenue to government budgets reduced during tough economic years.
‘I think $400 million will have a huge positive impact on communities,? he said. ‘School funding will not be hurt by Proposal 1.?
Residents vote on May 5 on Proposal 1, which would amend Michigan’s Constitution to raise the sales tax from 6 to 7 percent. It would collect about $1.4 billion more in sales taxes. Increasing truck registration fees would raise $50 million, with another $10.9 million from increased car registration fees.
Passing Proposal 1 would give Michigan the fifth highest tax rate in the nation.
About $1 billion is presently collected from sales tax on gas at the pump, which is sent to schools and local governments. If voters pass Proposal 1, the state would collect $2.1 billion the first year, 2016, and $1.8 billion over the next two years.
Sales tax on gas would be eliminated and replaced with a wholesale tax.Tax on diesel and regular gas would be lowered to 14.9 cents a gallon. The state would ‘adjust? gas tax annually for inflation.
A majority of funds collected in the first two years would be used to pay Michigan Department of Transportation’s $1.8 billion debt. Two-thirds of the tax money collected in the first year, and one-third of the money collected in 2017, will go towards paying the debt.
Cities, villages and townships would share $100 million; $300 million would be split up between Michigan’s school districts; $1.3 billion allocated for roads and bridges and $112 million for transit and rail; and $463 million raised into the states general fund, which allows allocation to any other fund.
According to Road Commission for Oakland County, Michigan spends the least on roads of all states except Georgia. Michigan’s crumbling roads and bridges require an estimated $3-5 billion to fix and $1.2 billion a year to maintain.
Work projects to complete long term fixes on roads, like restructuring or repaving, are very expensive and have been put on hold due to funding.
A majority of funding for RCOC comes from the Michigan Transportation Fund, which is mostly funded by states gas tax and license plate fees. Commissions also receive some state and federal funding.
Road Commission for Oakland County’s Craig Bryson said the commission lacks funds to properly fix roads the 2,700 miles of county roads, over 230 miles of state highways and approximately 1,500 county, city and state traffic signals in Oakland County maintained by RCOC.
Michigan road commissions won’t see substantial funding from the proposal until 2018. In the first year, RCOC will receive $14 million, in the second year $27 million and $41 million the third year and beyond.
Details of Proposal 1
New guidelines would be created for roads. Government entities would be able to finance road projects using expanded competitive bidding. Contractors must warranty road work costing over $1 million.
Money allocated to the School Aid Fund would allow funding for community colleges and technical schools, but prohibit funding higher education.
Heavy trucks, over 26,000 pounds, traveling Michigan roads will pay a 36.1 increase in registration taxes at the Secretary of State. Increasing revenues on heavy trucks will bring in $50 million. Michigan allows heavier truck loads than other states-heavy trucks are one of the main causes of damaged roads.
Vehicle registration fees will go up by eliminating a discount now in place.
Electric and hybrid vehicles will pay a new surcharge when registering their vehicle. Increasing registration fees will bring in an additional $45 million.
Low income families would get an increased Earned Income Credit on their taxes. An additional $267 million will be allocated in EIC changing it back to previous funding levels by increasing EIC funding from 6 to 20 percent.
Costs of Proposal 1
Citizens Research Council of Michigan, the oldest Michigan public policy group in the state, released their report on Proposal 1, which estimates drivers will actually pay over 10 cents more per gallon than they do now.
Drivers pay about 29 cents of taxes per gallon. Proposal 1 would raise taxes to about 41.7 to 46.4 cents a gallon for regular and diesel.
Mackinaw Center for Public Policy, citing information from the U.S. Census Bureau, Department of Transportation and Bureau of Labor Statistics, said households will pay.
‘Proposal 1 would increase the tax burden of the typical Michigan household by between $477 and $525 in 2016,? the report said.
Low income families would save $69 a year if eligible for Earned Income Credit, which will be increased from 6 to 20 percent.
Roads are crumbling
According to RCOC, the roads in Oakland County are crumbling, and the commission does not have the money to fix them.
RCOC said serious deterioration of county roads have occurred since 2006 due to a lack of funding.
RCOC has a $100 million budget for 2015 to maintain and fix the largest road system in the state. Oakland County has 61 villages townships and cities maintained by six garages to for county roads.
Oakland County has 770 miles of dirt roads, which must also be maintained by laying expensive gravel.
RCOC claims less funding and a 35 percent staff cuts have hurt their ability to maintain roads.
As of 2014, only 14 percent of paved roads in the county are in good shape, 42 percent are in fair shape and 44 percent are rated poor.
If Proposal 1 fails, the RCOC said by 2020 road conditions will seriously deteriorate, resulting in 66 percent of roads being poor shape and just eight percent in good shape.
If Proposal 1 passes, RCOC estimates 65 percent of county roads will be in good shape by 2020.
RCOC insists if the proposal fails, no new funding will be allocated for years, leaving roads to cost even more to fix.
Bryson said if Proposal 1 passes, the commission would hire more staff and contractors which would created 12,000 to 15,000 more jobs.
There is no plan B if Proposal 1 fails and RCOC charts show roads will just get worse.
The chart shows many main roads in Independence Township are in poor shape.
To solve the problem, Kittle proposed a partnership with RCOC.
To fix roads in Independence, the township would pay $250,000 for materials and RCOC would provide labor and equipment at no cost. If the township and RCOC entered the partnership, the township could control what area need to be fixed.
RCOC does not allocate specific funding for road work to each community. Instead each RCOC office prioritizes jobs in the area it oversees and allocated resources towards whatever roads need work first. Kittle said a partnership with RCOC is on hold as to not distract voters from Proposal 1.
More of your thoughts
On Facebook we asked, ‘Proposal 1, will lower the gas tax and increase the Michigan sales tax from 6 to 7 percent. Although the proposal lowers gas tax, drivers will actually pay more at the pump. How do you feel about about Proposal 1??
Most said they would be voting ‘no? on Proposal 1.
Ardith Abbot, ‘NO. Maybe we should stop using so much salt on the roads which is causing the craters and fix them correctly the first time instead of patching them and when you drive over it you have black stuff all over your car. It’s a vicious circle and they need to use the money they already have for the roads like they planned instead of raising our taxes. Dig into the fund and use the money for what it was intended not save it for a rainy day and to ensure you get a raise. Also, make sure the road commission is actually working when they are on the clock not baiting deer and going to chiropractic appointments or napping in parks.?
Dawn Trahey Anderson, ‘NO NO NO, Lansing needs to find the money elsewhere (no not the schools) and keep it consistent. No shuffling the budget. No raiding taxes or plate renewal. Completely irresponsible.”
Jay DeJong, ‘Our Michigan sales tax went from 4% to 6% not long ago with the promise of road repairs. Where’s that misappropriated money? The government is an animal that needs to feed itself, the larger it gets the more it feeds. If this tax becomes law it won’t change a thing and we’ll see another increase in ten years.?
Mark Schroeder, ‘We need to improve our roads, transit and bridges. I’ve been to England four times in the last 20 years the last time was the first time I felt we were not the better place primarily due to the conditions of our roads. Despite the problems with this bill we need to vote YES.?