Lansing State Journal: Gas tax - Saying no to tax increase carries costs for the state, too
Thursday, January 3, 2008
A Lansing State Journal editorial
Coming off one of the most bitter budget and taxation battles in Michigan history, it's hardly surprising that Gov. Jennifer Granholm says she's done with pushing tax increases.
Millions of Michigan residents no doubt endorse that stand - which apparently includes Granholm's opposition to a fuel tax increase.
And Michigan can choose to leave fuel taxes alone. But everyone from Granholm on down needs to recognize such a choice carries huge costs for the state; costs so high that actually boosting gas taxes is the more prudent policy.
That's been the position for some time of an unusual coalition of business and labor interests that formed the Michigan Transportation Team. They've pushed for months on end a few basic points:
- Michigan's road network is going to get worse, not better.
- Money is required to fix and improve roads.
- If Michigan doesn't improve its roads, a sagging infrastructure will drive away businesses and residents alike.
In the budget fiasco that was the State Capitol this year, the fuel tax issue was conveniently ignored. And now Granholm, in a recent discussion with reporters, stated that a fuel tax increase would be "impossible" due to the state's tough times.
That spurred the County Road Association of Michigan into the fray, with the group asking, if not now, when?
Granholm's own Department of Transportation has issued reports that show the state short tens of billions of dollars to meet its own long-term construction plans.
The road commissions say that current policy is leading to repair and staff cuts, which will only accelerate if change doesn't come.
Tax proponents also note another point - road construction work means jobs for Michigan.
To her credit, Granholm hasn't been idle on the road issue. She directed MDOT to reprioritize its strategies, emphasizing repairs of existing major roads over expansion proposals. And her "Jobs Today" program used bonding to create a construction and employment surge to advance that strategy.
But as the governor and legislators know well, there are limits to what you can do with bonding, not solely the fact that the use of bond funds imposes additional costs through interest payments.
And while investment in roads over the last decade has brought more than 90 percent of the state's freeways into good condition, MDOT projects that figure will decline to 78 percent as early as 2012.
In other words, drivers, these are pretty much the best of times.
So, are these the roads you want, you expect; the roads that will attract and retain industry?
Just saying no to gasoline taxes is an option. It's not the best one, though.