Gov. Rick Snyder planned Tuesday to sign legislation calling for a long-term increase in Michigan road repair financing through budget earmarks and increased motorist fees and taxes.
They’re intended to meet Snyder’s goal of securing at least a $1.2 billion annual increase in road and bridge repairs throughout Michigan but not until the 2021 budget year. A Detroit News analysis indicated the increase could fall short of that, even when fully funded.
“This is the largest investment in transportation in the last 50 years in the state of Michigan,” the governor told reporters at his Capitol office after the House gave the legislation final approval a week ago.
This latest infrastructure improvement plan awaiting his signature is programmed to reach its funding milestone two years after he leaves office.
Lawmakers chose to phase-in the new road money, starting with $600 million increases in fuel taxes and vehicle registration fees in 2017 and followed by gradually earmarking another $600 million of existing income tax revenue in fiscal years 2019, 2020 and 2021.
In the 2019 fiscal year, $150 million in general revenue is to be earmarked for roads. In 2020, the general fund contribution is to increase to $325 million.
The compromise road funding plan, brokered by majority Republicans after months of negotiations, raises the gasoline tax by 7.3 cents a gallon and the diesel tax by 11.3 cents a gallon on Jan. 1, 2017.
Registration fees on all passenger cars, vans and trucks will rise by 20 percent starting Jan. 1, 2017.
The fuel tax increase will generate $400 million more annually for road repairs and the higher registration fees would add $200 million to the long-underfunded transportation fund.
