The Michigan Association of Timbermen
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Posted on 11.04.2015 Under Legislative

Legislative Report for MAT

Judy Augenstein, advice Legislative Consultant

November 2015

Today the Senate revised the House road budget plan sent to them last Thursday and forwarded it on to the House this afternoon for more work.

The Senate plan would increase gas tax to 26.3 cents per gallon on January 1, web 2017, pharm a 7.3 cents per gallon increase.  The amount paired with bringing the current 15 cent per gallon diesel fuel to the same level, is intended to generate $400 million in revenue inflationary increases would beginJanuary 1, 2022.

The registration fee increases, previously scheduled to be 40 percent across the board in the House plan, decreased to 20 percent for passenger vehicles and trucks, which would generate an estimated $200 million.  Those take effect January 1, 2017, one year after what the House had originally proposed.  Both the gasoline tax increase bill (HB 4738) and the vehicle registration bill (HB 4736) passed on votes of 20-18.

The Income Tax rollback would occur when General Fund growth exceeds the rate of inflation, then multiplied by 1.425.  The rollback could occur on January 1, 2023.

The lock box included in the Senate plan is back in the final deal.  Under the original Senate plan, the legislation would have locked up the last 7 cent increase on the gas tax annually until the lock box is opened via passage of a concurrent resolution.  Under the new plan, it would lock up the first $100 million of gas/diesel fuel tax increase until unlocked via the passage of a concurrent resolution.

The General Fund dedication in fiscal year 2019 is $150 million, then $325 million in fiscal year 2020.  In fiscal year 2021, the GF dedication would be $600 million.

The plan keeps the House provision to expand the Homestead Property Tax Credit largely as outlined by the House.  The income multiplier is 3.2 percent in tax year 2018 and the maximum credit $1,500 that same year. It also increases the renter credit.

There is also an MDOT administrative cap of 8 percent, competitive bidding and warranty  assurances and pubic transit flexibility.  Now the last remaining question is if the plan can pass the House.  The House had preferred to raise more of the new revenue from vehicle registration fee increases.  As of this writing the House is still in session working on the plan. The Republicans are in caucus trying to muster votes for the road plan sent to them this afternoon by the Senate—stay tuned!

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