15-Cent Gas Tax Hike to Fix Roads Before Senate

The Michigan Senate plans to take up proposed legislation to add another 15 cents to the state’s gas tax as part of a plan to fix the state’s crumbling road system.

The tax, which would be phased in over a couple of years, would raise between $700 million and $800 million a year, the Detroit Free Press reports.

The plan’s architects also propose redirecting about $1.4 billion in state tax dollars, and offsetting some of the additional pain at the gas pump with a corresponding cut in the state income tax. The tax on diesel fuel, currently 15 cents gallon, would be raised to 19 cents a gallon to match the tax on regular fuel.

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• Would you pay an additional 15-cent per gallon gas tax to fund road repairs? What are the alternatives?

The plan hasn’t been formally announced, but the Free Press said the general outline of the plan had been confirmed by several sources in the Senate.

Senate Republicans plan a five-hour caucus Tuesday to determine if there are enough votes to pass the measure.Assuming there’s enough support, the Government Operations committee could take up the legislation as early as Tuesday afternoon.

Earlier this month, the state House approved a plan that would cut $135 million in Michigan Economic Development Corp. funding, cut he Earned Income Tax Credit for working poor families, and raise the diesel tax to match the tax on gasoline.

Many in the Senate and Gov. Rick Snyder said that while they liked some elements of the lan, more revenues were needed to generate the $1.2 billion in additional money needed every year to return roads to safe driving condition. The Senate proposal is a scaled back version considered last fall that would have doubled gas taxes over four years.

A complex sales tax proposal to fund improvements and generate more cash for schools and local governments was soundly defeated, 80 percent to 20 percent, in a statewide May 5 election.

Lance Binoniemi, vice president of government affairs for the Michigan Infrastructure and Transportation Association, said the Senate proposal has the right mix of current and future revenue needed to win House approval “in this political climate.”

“I don’t think all new revenue can muster up enough support,” he told the Free Press.

The Senate is to be in session Tuesday and Wednesday before recessing for the Fourth of July holiday. The House is off until July 14.