FROM THE DETROIT NEWS
With the ballot drive to raise the sales tax to fix Michigan’s roads already in disarray, Gov. Rick Snyder should appeal to leaders of the new Legislature to make a fresh effort to get highway funding right
Asking voters to hike the sales tax to 7 cents on the dollar from 6 cents was a poor plan in the first place, and was only signed by the governor because a cowardly Legislature failed to do its job during the lame duck session.
Now, with the May 5 election just over three months away, the ballot initiative is in early trouble. Some polls indicate voter support is under 50 percent; the conventional wisdom in Michigan is that ballot proposals must start with 60 percent support or higher to have a chance at passage.
Of course, the pro-tax hike campaign spending hasn’t started yet. Road builders and others are expected to spend between $10 million and $15 million, and it’s not clear where opposition spending will come from. That amount of money could move public opinion.
Still, taxpayer sentiment appears to be strongly against the measure, and even some key Snyder allies such as the Michigan Chamber of Commerce haven’t yet decided whether to get on board.
Unintended consequences of the measure are starting to surface. For example, an analysis by economist Patrick Anderson raised the possibility that 1.2 million taxpayers who claim the vehicle registration fee on their federal forms may lose the deduction because part of that revenue will be switched to the sales tax, which isn’t deductible.
And the campaign team the governor assembled to push the proposal resigned this week, citing unspecified philosophical differences.
With all that in mind, the most responsible course would be to go back to the Legislature and ask for an alternative transportation funding bill that makes sense.
Michigan has always funded its road work with user fees — fuel taxes and vehicle registration. That remains the best financing option. For one thing, fuel tax revenue by state Constitution must go to the roads.
The sales tax, however, can be used for anything. The ballot proposal includes money not just for roads, but also to restore the earned income tax credit for low income workers and $300 million for education.
Those should be separate funding matters debated on their own merits. Michigan taxpayers deserve a clean road funding bill.
There’s no precedent for recalling a Constitutional amendment once it’s been sent on its way to the ballot.
But the Legislature and governor could craft an alternative bill that would go into effect if the ballot measure fails.
That Plan B bill should raise either the fuel tax or the registration fee, or both. It could also include a commitment to squeeze more money out of existing state spending to add to road funding. Voters should have a choice between a sales tax hike and a more efficient bill that raises fuel taxes. But there is no choice but to fix the roads.
Continuing on the current path risks an embarrassing defeat in May that might doom future efforts to raise road revenues.