- Associated Press - Sunday, May 3, 2015

LANSING, Mich. (AP) - Michigan voters on Tuesday will decide if they want to pay more taxes for better roads. A look at Proposal 1 and the election:



The constitutional amendment would raise the sales tax from 6 percent to 7 percent, exempt the sales tax from fuel, limit how school aid money is spent and trigger laws increasing gasoline and diesel taxes at least with inflation, no longer gradually reducing license plate fees by nearly 30 percent after a car is registered and boosting a tax credit for lower-wage earners. Registration taxes on commercial trucks and electric/hybrid vehicles would rise. The plan also includes improved warranty and bidding practices. It would generate $1.8 billion more annually, including $1.3 billion for transportation, an increase of roughly a third.



Proposal 1 is a bipartisan deal between Republican Gov. Rick Snyder and the last GOP-led Legislature. Ten related laws will take effect only if the ballot measure wins voter approval. While Snyder and the Senate preferred increasing fuel and registration taxes, House Republicans balked at higher pump taxes and complained that the sales tax on fuel mostly does not go to roads. Pump taxes would only go to transportation under the proposal, which would increase the sales tax on other goods to keep schools and local governments from losing money. They actually would receive more funding under the measure.



Not good, despite supporters outraising the opposition $9.3 million to $520,000. Voters last OK’d a net tax increase in a statewide vote in 1960, boosting the sales tax from 3 percent to 4 percent. Voters in 1994 raised it to 6 percent to partially replace property and income tax cuts under a school-funding overhaul. But that came after they had rejected a dozen tax-related ballot proposals dating to 1978, not trusting promises that high property taxes would be lowered and replaced fairly, according to Inside Michigan Politics. Asked recently about Proposal 1, just 29 percent of likely voters said they supported it while 61 percent were opposed in an EPIC-MRA poll.



If approved, the tax hikes would go into effect Oct. 1. If the plan is defeated, Snyder and lawmakers will have to regroup to address a problem that is not going away - declining fuel tax revenue resulting from people who drive less and with more fuel-efficient vehicles while construction and snow-plowing costs rise. Revenue from state fuel and registration taxes is roughly the same today as 15 years ago, and the network of roads and bridges is worsening. It is unclear if legislators would see the proposal’s defeat as evidence that voters outright oppose tax hikes or just saw this plan as too complex and an overreach.



Snyder and others in a broad coalition of business leaders, sheriffs and others urging a “yes” vote will cap a three-day tour Monday with stops in Lansing, Howell and Detroit. Their message: Residents do not like their roads and this is a chance to solve a decades-old problem of underinvestment in infrastructure. Conservative activists encouraging a “no” vote were handing out fliers and yard signs to push their side to the polls. Their point: Residents want better roads but oppose $700 million in additional taxes for other government functions.


Follow David Eggert at https://twitter.com/DavidEggert00

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