Environment Picture

President’s Column: How the transportation deal stalled

(and why lawmakers must get it running again)
The condition of Michigan’s roads, bridges and public transportation is, to put it mildly, nothing to brag about. So it was a big opportunity for MEC when, in 2011, Gov. Rick Snyder asked us to be at the table as he began to develop his transportation and infrastructure special message to the legislature. We told the governor then what we still say today: How you spend your transportation dollars is just as important as how much you spend. In the three years since, we’ve been working not only to secure adequate funding for our transportation system, but also to transform it.

A September 2011 legislative report found that getting 85% of Michigan’s roads and bridges in good or fair condition would require an initial increase of $1.4 billion per year from 2012 to 2015, and $2.6 billion by 2023. The report also pointed out that a failure to act would only increase the amount needed to close the growing revenue gap. Even more money is needed if we also want improvements in the rest of our transportation system, including transit and non-motorized transportation.

Michigan needs a 21st century transportation system that is multimodal and interconnected, one that balances improved mobility with expanded access—to jobs, affordable housing, education, shopping, the arts and entertainment. We need to maintain our roads and bridges while increasing support for public transportation and passenger rail to link our major cities. Doing so is central to the future economic and social well-being of our great state.

Transportation issues also have major implications for our environment:
  • The transportation sector accounts for close to 30% of our greenhouse gas emissions.
  • One of the largest sources of water pollution is stormwater runoff from our roads and related facilities.
  • Transportation decisions shape land use and development. To stem the tide of urban sprawl, we need vibrant communities that are walkable, bikeable and offer transportation options.
How the wheels came off
For much of the most recent legislative session, it seemed another year would pass with little action on transportation. The legislature appeared willing only to add one-time general fund dollars to patch a small portion of our funding gap. Then, almost out of nowhere, the Speaker of the House offered up a partial solution: $450 million for roads only. Those of us who had been working on this issue quickly shifted into high gear. The plan was to help push this partial fix out of the House and over to the Senate, where a more complete solution could be found.

I spent a lot of time testifying before my former colleagues and friends in the legislature on MEC’s behalf and working behind the scenes to find the votes to move the issue forward. We admitted the Speaker’s plan included too little money and left out public transportation, but it was the most viable path forward. The House quickly moved the bills to the Senate, where testimony resumed in the Infrastructure Improvement Committee. The committee put its own stamp on the package by modestly increasing the funding and using the traditional transportation funding formula known as Act 51, a move that would support public transportation (and hopefully earn Democratic votes). Once the bills reached the Senate floor, the Majority Leader made a bold move to increase the current funding level by $1.5 billion annually, through a gradual increase over four years in the fuel tax.

The clock was ticking as the legislature’s summer recess approached. Legislative legacies are made or broken in such situations.

Wednesday, June 11 was D-Day for transportation funding. The Senate appeared ready to finally fix Michigan’s transportation funding woes. The plan was for the Senate to pass a comprehensive funding package and send it back to the House for a final vote before the summer break. At high noon, a deal was struck to pair the necessary transportation funding to a $200 million restoration of the homestead exemption under the state’s income tax. The Senate passed several smaller funding bills and the homestead exemption sailed through on a 37 to 1 vote. All signs pointed to a huge victory as the Senate prepared for the big vote on the main funding bill.

The wheels started to come off as the Senate tried to pass a sales tax increase that voters would have to approve as an alternative to raising the fuel tax. This alternative proposal failed miserably, falling 12 votes short of the needed two-thirds supermajority. When legislation to increase truck fees and overweight fines failed, the effort was close to running out of gas. Wednesday night the Senate opened the “board” to vote on the main funding bill, HB 5477, which would have gradually increased the fuel tax over four years to generate close to $1.5 billion annually for the transportation system. As the voting clock ticked down, the yes votes came up short of the majority needed. The bill failed on a 17 to 21 vote. As session pressed on past midnight, the Senate tried to pass several versions of HB 5477 that would have raised significantly less revenue, but the votes never broke the twenty needed for passage. MEC maintained its presence at the Capitol until 1:00 a.m., Thursday morning, when the Senate finally adjourned.

Transit matters
For three years MEC and our allies have urged the legislature to address our transportation system’s growing needs. Michigan’s gas tax hasn’t increased since a 4-cent boost in 1997. That new revenue was dedicated to roads and bridges only, bypassing part of the Act 51 formula.

Transportation funds need to go through the full Act 51 formula to benefit our complete transportation system, not just one leg of it. Otherwise, two important transportation funds suffer: the Natural Resources Recreation Improvement Fund and the Comprehensive Transportation Fund.

The Natural Resources Recreation Improvement Fund provides funding for more than 12,000 miles of motorized and non-motorized trails and other recreational projects. It also supports Michigan’s waterways, which are a fundamental part of our economy. Every year over 200 million tons of cargo passes through our Great Lakes waterways, and the shipping and storage of that cargo represents over 65,000 Michigan jobs. Recreational boaters, using our state’s 1,300 public access sites and over 80 harbors and marinas, put $3.9 billion annually into our state’s economy, supporting 50,000 jobs.

The Comprehensive Transportation Fund (CTF) provides funding to our public transportation system, including local public transit, intercity bus service, passenger rail and freight rail. Every year since 1997, the CTF has missed out on almost $15.2 million because transportation funds bypassed a portion of Act 51—a total of $259 million. The last time the CTF saw a structural increase was in 1987!

Public transportation’s value grows
With the number of vehicle miles traveled down nationally for the ninth straight year, public transportation is more important than ever. There is plentiful data to demonstrate its growing value:
  • Last year, over 95 million passenger trips were taken on local public transit in Michigan.
  • Nationally, transit ridership hit record heights in 2013 that haven’t been seen in 57 years, topping off at 10.7 billion passenger trips.
  • Annual ridership on Michigan passenger trains has skyrocketed by more than 78% since 2002, bringing over $62 million annually in community benefits to towns along its routes.
  • Across Michigan, more than $730 million in economic and other benefits come from public transit.
  • On average, property values perform 42% better if they are located near public transportation with high-frequency service.
Most importantly, it is the people who rely on public transit, in both urban and rural communities, who really matter. They rely on it every day to get to work, to school, to the doctor’s office, to the store and to see their family and friends.

Transit use by people 65 and older increased by 40% from 2001 to 2009. That population will double in the next 25 years. In 2010, Michigan transit providers served more than 4.3 million senior passengers. Seniors account for 83% of public transit ridership in the City of Hancock; 30% for Charlevoix County Public Transportation; and 27% for the Benzie Transportation Authority.

Transit also matters to our young folks. More than half of millennials —today’s young adults—would consider moving to another city if it had more and better options for getting around. Two-thirds of millennials say access to reliable public transportation is one of the top three criteria they would use to decide where to live. As Gov. Snyder has said, in determining Michigan’s economic future, “probably the single most important issue is talent.”

Our transportation system is more than just a network of roads and bridges, and we need to fund the whole system, not just a portion of it. Let’s hope that, when the legislature comes back from summer recess, they’ll finish the job they left uncompleted. Their legacy, and the way forward for all Michigan residents, depends on it.
-Chris Kolb
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