Proposal 1: Road funding solution or highest tax hike in decades?

Posted at 5:37 PM, Apr 20, 2015
and last updated 2015-04-20 17:37:42-04

GRAND RAPIDS, Mich. – In just two weeks, Michigan voters will decide whether or not to adopt Proposal 1, the road funding issue.

If approved, the proposal would generate $2 billion by increasing the state sales tax from six to seven percent, creating a new and higher gasoline tax. Most of the revenue would be spent on road and transportation funding and repair. However, nearly half of the money generated would go to other issues not related to roads, such as increasing funding for public school districts and prohibiting public universities from receiving money from the state’s School Aid Fund.

It’s no question that Michigan’s roads are beat up.

“We have Pure Michigan advertising campaigns that’s national, that’s trying to draw people into our community,” said Rick Baker, president and CEO of the Grand Rapids Area Chamber of Commerce. “They come into our world-class airport, they come into our beautiful state, and they experience horrendous roads.”

But some in opposition of Prop 1 said this is the largest tax increase in decades and not enough of the funding would go to road repair.

“It’s a $2 billion tax increase that only at best 60 percent is spent on transportation," said Paul Mitchell, chair of the Coalition Against Higher Taxes and Special Interest Deals. "Of that, only part is spent on the roads; the remainder is spent on a variety of other things that have nothing to do with the roads."

Meanwhile a national transportation research group out of Washington D.C. called TRIP released a report Monday, which states Michigan roads are expected to get even worse due to a lack of funding.

TRIP’s research projected 53 percent of state roads to be in poor condition by 2025, which plays into economic growth. “While the state’s economy has begun to rebound in recent years, after a devastating downturn, that recovery could be put in jeopardy if the state’s transportation system is not adequate to handle the growth,” said Carolyn Kelly, associate director of research and communication for TRIP.

The report also stated that 4,600 people were killed on Michigan’s roads in the last five years, but opponents say the report’s reasoning on dangerous roads is skewed. “The report, if you read it, it says that a third of all traffic accidents, serious or fatal traffic accidents, they’re caused by environmental factors that include snow, sleet, rain, road debris, and in fact road conditions aren’t even mentioned on that list,” said Mitchell. “It’s an example of misleading the voters and trying to scare them.”

The Kent County Road Commission Managing Director Steve Warren told FOX 17 he supports Prop 1 or another solution that would be of similar magnitude. If passed, Prop 1 would double the commission's annual budget for road maintenance and repair, Warren said.

“Proposal 1 provides $21 million more to the Kent County Road Commission when it’s fully implemented” said Warren. "It’s going to take a solution of that size, that significance, to get us to where we want to be."

Yet opponents like Mitchell hold onto the fact that Prop 1 is the largest tax increase in decades and call on the legislature to find another solution.

“It’s responsible government: using the money efficiently that you have, reflecting the priorities of the citizens, not interest groups," explained Mitchell, "and if you can’t get the job done, then asking the citizens for a tax increase.”

“They haven’t done steps one and two, and they’re going to step three. That’s not public policy that’s even good politics; that’s the worst form of deal making.”

According to U.S. Census data, if Prop 1 passes, a typical Michigan household could expect to spend an additional $500 in state taxes next year.