By Zachary Gorchow
President of Michigan Operations
Posted: March 6, 2019 1:04 PM

Amid the largely dour reaction among majority legislative Republicans on Governor Gretchen Whitmer's 45-cent gasoline tax hike to drag the state's roads out of a Michigan-sized pothole, there was this revelation that got overlooked: Senate Majority Leader Mike Shirkey (R-Clarklake) supports finding $1 billion in new revenue for roads.

Mr. Shirkey, speaking to WJR-AM Tuesday, clearly panned Ms. Whitmer's proposal to increase the gasoline tax from 26.3 cents per gallon to 71.3 cents. He gave it a "D-" for creativity, said he in no way thought Michigan motorists would be willing to pay that much more and forecast strong opposition in the Legislature. Ms. Whitmer's proposal would raise $2.5 billion, though it would actually mean a $2.137 billion increase in road funding because some $325 million from the General Fund used for roads would return to General Fund programming. Also, the Constitution requires 2 percent of gasoline tax revenues to go to recreation (snowmobiles and ATVs use gasoline, too).

A number somewhere between $2 billion and $2.7 billion is considered what is needed in additional revenue every year to bring the state's deplorably bad roads back to 90 percent in good or fair condition by 2030. It's down to 78 percent (a number that almost seems laughably high) and forecast to decline rapidly in the coming years.

Now, to one way of thinking, the traditional Lansing way of thinking, Mr. Shirkey's remarks suggest there's a deal to be made. Meet somewhere in the middle, maybe $1.5 billion. That's a 27-cent increase per gallon.

If Ms. Whitmer and the Legislature could agree to that, it would be an extraordinary feat given the tortured history of road funding in Michigan, which to recap included a wrenching effort to pass a middling four-cent increase in the gasoline tax in 1997 and an even more painful task to get a 7.3-cent gasoline tax increase and a vehicle registration fee hike in 2015.

Dial up the cliché machine, that half a loaf is better than no loaf, that Ms. Whitmer and the Legislature would have moved the ball downfield, maybe not into the end zone for a touchdown but, when combined with the 2015 plan, getting close.

The problem is even with the full $2.5 billion more per year, it will only keep the overall road system from getting really terrible in the next three years. The percentage in good or fair condition will simply hold at about 78 percent instead of falling rapidly. By 2023 and beyond, that's when, with $2.5 billion more per year, the system will start to improve overall.

So, with "only" $1.5 billion more per year, the roads overall will continue to get worse even if this freeway here and that heavily used local road there get fixed. Former Governor Rick Snyder and the Legislature got a lot of heat in 2017 and 2018 about roads from motorists wondering why they continued to fall apart even though they were paying more in gasoline taxes and vehicle registration fees from the 2015 plan. That's because the 2015 plan really didn't increase the amount of funding for roads much in the near-term and was designed to phase in over a six-year period.

Imagine the outcry with a 27-cent gasoline tax increase and the roads overall keep getting worse.

Ms. Whitmer and Budget Director Chris Kolb kept emphasizing that $2.5 billion number Tuesday. If there's another way legislators want to get there, they said, they are listening but that has to be the number, they insisted.

This is the unknown at this point. Will the new governor with her 14 years in the Legislature be willing to accept something less than $2.5 billion and declare victory, that she achieved the biggest revenue increase for roads in state history? Or is Ms. Whitmer concerned that she could simply end up with a repeat of 2015, when Mr. Snyder grudgingly accepted the plan with $600 million in new revenue and a gradual phase-in of $600 million from the General Fund but still trumpeted it as a win only to see the roads keep getting worse and motorists wondering where all that extra money they sent to Lansing went?

For a governor who ran on fixing the damn roads, the stakes couldn't be higher.