On Monday, Governor Gretchen Whitmer followed up on last week’s approval of the new state budget and a road funding plan with stops in a few ceremonial bill signings in Flint, Clinton Township, and Kalamazoo.
The stops gave the governor a public opportunity to speak to what she saw as wins from the budget process while surrounded by supporters. She signed the actual spending and road funding bills in her office last week in a closed-to-media gathering of public officials.
Monday’s Clinton Township stop focused on the roads part of the plan, which will phase in revenue over time.
Wearing a high visibility vest and a red, white and blue hard hat, Whitmer said communities can expect a large increase in money for local roads.
“We’re going to make every single part of your drive better and easier. From the moment you leave your driveway to when you come home at night. And we’re going to connect our cities and whole regions together with world class rail and transit services as well,” Whitmer said as a crowd of road workers and public officials cheered her on.
A combination of spending cuts, redirection of taxes on gas sales, and a new marijuana wholesale tax will eventually put an estimated $1.8 billion toward repairs.
For many recent projects, the state relied on a combination of federal money and bond financing. Michigan State Budget Director Jen Flood said the state had been facing a “cliff” because that money was running out.
Flood said spending cuts and tax revenue that cover the new plan will be reliable.
“At the same time that we passed revenue as a part of this package, we also cut taxes for seniors and working families, with no tax on tips, overtime, or social security. We always do that through a lens of making sure that what we’re doing is sustainable and structurally balanced,” Flood told reporters.
Aside from putting more money into local roads, the legislation included around $160 million for public transit. Around $65 million of that would go toward a new fund for what supporters are calling “transformational” projects, potentially including expanded passenger rail to connect Michigan’s major cities.
State Representative Jason Morgan (D-Ann Arbor) said the money could help Michigan become eligible for federal funding to support that type of work.
“This puts us on the map for truly expanding public transit in Michigan in a transformational way. It frees up the state to pursue more federal dollars. It allows us to actually come up with a long-term vision and plan for what mobility looks like in Michigan,” Morgan said.
Aside from transportation, however, lawmakers could be busy the rest of the year working on economic development legislation. The latest budget allowed funding for one of the state’s main efforts to attract large-scale investment, the SOAR Fund, to run out.
Democrats and Republicans had criticized it for approving hundreds of millions of dollars for projects that have fallen behind schedule or haven’t made good on promised jobs.
Instead, Republican House Speaker Matt Hall (R-Richland Twp) said he wants to see businesses get reimbursed for some of the costs of creating new jobs with the tax revenue businesses generate.
“We want to have the tools in place. But we can’t do any more of these hundreds of millions of dollars of cash handouts to the big corporations. It didn’t work and they didn’t create any jobs,” Hall told reporters.
That proposal could overlap with some efforts in the Democratic-led state Senate. Governor Whitmer’s administration has pointed to proposals like HIRE, a tax incentive based jobs program, as possible paths forward.
