Republicans' $3.1B road funding plan clears the Michigan House

Yahoo

20-03-2025

Sponsor on Michigan House Republicans' road funding package and Chair of the House Transportation and Infrastructure Committee Rep Pat Outman (R-Six Lakes) speaks in support of the legislation amid concerns from Democrats on the House floor on March 19, 2025. | Photo: Anna Liz Nichols
The Michigan House gave the greenlight to Republicans' $3.1 billion road funding plan Wednesday, voting it through the chamber with the support of several Democrats.
But there are potholes in House Republicans' path to getting a longterm solution to road funding into law, an endeavor highly desired and long sought after in Michigan, where infrastructure has long been underfunded as the years bring their wear.
Republicans are praising the plan as a means to use existing state dollars towards a roads solution, without levying new taxes, while Democrats are widely bashing the plan as a gamble that will hang vital services out to dry without the means to fund them.
The plan would remove the 6% sales tax on gas and instead increase the motor fuel tax by 20 cents which would be wholly dedicated to funding road upkeep. Democratic Governor Gretchen Whitmer proposed her own 45-cent gas tax increase in 2019, which did not gain momentum in the GOP-led legislature at the time, leading her to successfully pursue $3.5 billion in bonds for road repairs
'I'd be embarrassed if I were her': Republicans keep slamming Whitmer's old gas tax plan
But Whitmer and the Legislature are eager for a long term solution, not one-time spending, to create the budget infrastructure needed to save Michigan's crumbling infrastructure, Michigan House Speaker Matt Hall (R-Richland Township) told reporters before the vote.
'We can fix our roads without raising taxes…we're going to ensure that all of the money collected at the pump goes to roads,' Hall said. 'We're going to make a difference for the people of Michigan, something they actually see and feel in terms of fixing our roads.'
In order to backfill the funding to the state's School Aid Fund that schools would lose with the elimination of the sales tax at the pump, part of the plan would dedicate $755 million from Michigan's General Fund towards schools allowing $945 million from the tax restructure to go to roads. In addition $95 million would be diverted from the General Fund annually for the cities, counties and villages that received funding from the sales tax.
The bulk of the proposal, about $2.2 billion, would come from taking Corporate Income Tax revenue and using it for roads. Part of the plan is aimed at eliminating the usage of old Michigan Economic Growth Authority tax credits in order to increase the Corporate Income Tax revenue and increase funding for roads.
But with the shifts in general fund dollars called for in this plan, it will be the task of the partisanly split legislature to work out how the deficit, potentially hundreds of millions of dollars, will work in the state budget.
Many House Democrats articulated that they are not trusting Republican leadership's promises to keep schools harmless in the process, as well as public services and resources used by Michiganders. The plan would need to clear the Democratic-led Senate and gain Whitmer's approval, likely after rigorous negotiations, to become reality.
There would be no telling where budget cuts would come from in order to fund an unsustainable system for road funding, Minority leader Rep. Ranjeev Puri (D-Canton) said after a handful of Democrats voted in favor of the package of bills in the plan Wednesday.
The plan is 'robbing Peter to pay Paul' Puri said, stealing money from one part of the state budget to pay for others.
'Without a fully baked plan, this is just a terrible use of our state dollars,' Puri said. 'We are putting so many critical services that are funded and dependent on our state budget at risk.'
Sponsor on the bill package and Chair of the House Transportation and Infrastructure Committee Rep Pat Outman (R-Six Lakes) rebutted after the votes, 'we are not cutting any essential services. You have my commitment.'
In an overview, those essential services include public safety, public health, infrastructure and education, along with other sectors, Outman said as lawmakers go through the budget 'line by line' to eradicate wasteful spending or expenditures that are not getting taxpayer value.
'I don't know how to make it any clearer how much government spending has exploded here in the state of Michigan,' Outman said. 'If roads and education are our most pressing needs, why don't we fund those things first, then fund everything else after the fact. We don't seem to be able to budget like that and the people are begging us to act and to fix this infrastructure problem without raising their taxes and that's what we're delivering here.'
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