Michigan House Passes Alternate Road Plan, Could Impact Schools, City Governments

 The State House approved a plan to improve roads without hiking up taxes on fuel.

Now, it heads back to the Senate, who already passed a very different plan.
The proposal would phase out sales tax on fuel until 2021.

House Speaker Jase Bolger’s plan would raise an extra one point $2 billion a year for roads.

But some critics say the plan would hurt schools and city governments, taking away hundreds of millions in revenue.

“It is important to repair roads but not on the back of the school district,” said Don Gustafson, Superintendent of Saint Ignace Area Schools.

Today school districts in Northern Michigan fear that plans to fix roads could mean a loss in revenue.  The House plan would use sales tax revenue, money that already goes into the school aid fund.

“There are reports that hundreds of thousands would come out of school aid fund and would be devastating to those districts like ours struggling to keep revenues above expenses,” said Gustafson.

Educators say the house plan would be another blow to school budgets that have already taken many hits.

“Students will be impacted here in St. Ignace, we had to lay off employees because of declining enrollment and if revenues continue to decrease because they are going to be used by the state we will have further problems in our rural budget system here in Northern Michigan,” said Gustafson.  

And city governments worry they will miss out on funds too.

“It’s gonna be a definite impact if they take from our revenue source expenses keep climbing and revenues don’t go up much now they’re going down,” said St. Ignace City Manager Les Therrian. 

Governor Snyder today said the house bill creates major consequences for schools and cities.  

By contrast, the Senate bill to improve roads includes doubling the gas tax over 4 years.