Franz: Transportation bill is hardly about fixing roads.

December 26, 2014


By Rob Alway. Editor-in-Chief.

State Representative Ray Franz isn’t very impressed with the legislature’s transportation bill that was passed in the middle of the night last week. The Republican from Onekama represents the 101st District, which includes Mason, Manistee, Benzie and Leelanau counties. Franz said the $1.9 billion bill is not about fixing roads as much as it is about raising new money and giving it away to multiple groups.

“This is about new money,” Franz said. “The House had a plan that put $1.2 billion directly to roads. There was nothing skimmed off and nothing take out. It all went to roads.” The bill that passed was a compromise between the House of Representatives and the Senate. The Sentate’s bill would have raised $1.2 billion in new money.

“This was supposed to be a compromise and between zero dollars in new revenue from the House’s proposal and $1.2 billion in new money from the Senate. Only in government is raising an addition $7 million a compromise.”

Franz was one of 16 legislators who voted against the bill, which calls for an amendment to Michigan’s constitution, which would increase the sales tax. That amendment can only be changed by a vote of the people, which will take place in May.

If the constitution is amended, the sales tax on fuels will be eliminated and the sales tax will be increased from 6% to 7%. In addition, the current 19 cents per gallon gas tax and 15 cents per gallon on diesel, will be eliminated and replaced by a 14.9% tax at the wholesale price.

“This supposedly has a floor and a ceiling so that the total tax will be only a little more than the current total,” Franz said. “The problem is that the spread is wide enough to accommodate new inflation if fuel prices go up. But, if the fuel prices continue to decline, the percent goes up to stay equal to the new totals. In essence, this will give us an effect percent of way more than 15%.

“On top of that, the wholesale tax is indexed to the consumer price index or 5%, whichever is less. That means in 2017, the tax is 15% , in 2018 it’s 15.1%, in 2019 it’s 15.2% and so on.”

Vehicle registrations will also no longer depreciate on vehicles sold after Jan. 1, 2016. “Your plates will cost the same for the life of the vehicle,” Franz said.

He said out of the $1.9 billion, only $800 million will actually be going towards roads. At least in theory.

The $800 million will be divided up between federal, state and local governments. However, in the first year, only $400 million be available for roads. The remainder will be used to pay down debt the state accumulated during the 1990s. The funding will then increase by a third the second year and then the entire amount will be available by the third year.

Franz said he’s doubtful that much of that money will actually be put into actually fixing roads and bridges.

“I already have road commission managers calling me telling me that they plan on using some of the funds to buy new equipment and to give raises to employees,” he said. “That’s not fixing roads.”

What about the rest of the money?

“This package provides $300 million to schools. Plus, about $900 million will go to local governments. It will then fund infrastructure, which includes broadband Internet, mass transit (such as dial-a-ride), streetscapes and bike paths. It will be used to fund a light rail system, the M-1, near Detroit. This bill also allows Detroit to set aside 20% of its road funding for subsidies to transportation.”

Franz said the M-1 light rail will cost the state a lot of money. “The base fee will be $1 to ride, but it is estimated that it will cost $10 per person for a ride. That means the state will be subsidizing it.”

He said he isn’t necessarily opposed to bike paths and mass transit, but the bill is misleading to the public.

“This is being sold as a road package and it’s hardly about roads,” he said.

He said the $300 million for education and $900 million for local governments have nothing to do with transportation.

“This doesn’t necessarily buy buses for the schools or fix local streets. This is just money to give to them. I think it’s just a way to buy their vote.”

He said the bill is not good for Michigan.

“This will have a negative impact on the economy,” he said. “I don’t think they are telling the citizens the whole truth about this bill and I need my constituents to know that it’s a bad piece of legislation.”

Franz, who is entering into his final term, said he anticipates there will be very little opposition to the bill and expects a strong campaign to encourage people to vote for the constitutional amendment. He said he believes this is the wrong choice for Michigan, though.