A report from the Citizens Research Council of Michigan says the approval of up to $1.8 billion more for transportation in the state budget is by all accounts a good thing, but there are multiple problems that could keep the money from going where it's needed most.
Worst case scenario? Some of the additional funding could fail to materialize.
The research council's Eric Paul Dennis said one source of the additional funding for transportation is a new 24% tax on cannabis. The marijuana industry is suing to try to block that tax, "so there's extreme uncertainty about the revenue that will be available through the marijuana wholesale tax."
Another source of roads funding that could dry up is the state's corporate income tax. Roads won't get any of that money until the first $1.25 billion is raised and allocated to other priorities, said Dennis — and in 2020, the program didn't even reach that amount, he said, so there was nothing left over for transportation needs.
Dennis said the uncertainty will make it very difficult for road commissions and cities and villages to plan ahead.
"Many construction projects are planned three, four, maybe even five years in advance, so it's really important to have a good idea how much funding is on the way, and this throws that into disarray."
Dennis said state lawmakers rushed the budget negotiations, and they failed to analyze the system's most important needs and properly allocate the funding stream. He said the existing roads program is overly complicated and inefficient.
"As we move forward, policymakers at the state level need to think harder about how road funding is being used, rather than simply how much of it there is," he said.
The best way to do that, he said, is for lawmakers to repeal the state's outdated and cumbersome 1951 Highway Act, and adopt a new one.
