file photo Boyd Loving
Before Hiking Gas Taxes, Michigan Needs to Spend Money for Roads More Wisely.
Joel Griffith / @joelgriffith / December 10, 2014
Michigan Gov. Rick Snyder (R) is leading an effort to gradually double the state’s 19-cent per gallon gas tax. Doing so would boost the state’s transportation coffers by over $1 billion new tax dollars.
But Snyder isn’t sure that’s enough, saying, “The money I’m talking about is to get us to fair to good roads. They’re not even going to be great roads, folks. We can’t afford to have great roads in this state given what we need to invest.”
Admittedly, Michigan’s nearly 10,000 miles of state highway are in need of repair. The 2014 annual highway report from the U.S. Department of Transportation[?] ranks Michigan at a lackluster 32nd, in terms of overall highway performance ranking. Certain aspects of the system rank even lower, such as its urban interstate pavement condition (38th) and rural interstate pavement condition (40th).
Trouble with Michigan’s approach is, simply hiking taxes without fixing underlying spending problems isn’t the responsible solution. As a recent Reason Foundation report on state highway funding comparisons suggests, Michigan and other states seeking to raise taxes on drivers are overlooking a big problem: they aren’t spending existing tax revenue on the right things to benefit the people paying the taxes in the first place. And they’re squandering money on counterproductive regulations
Consider Wyoming, which has mountain terrain and primarily rural expanses of highway. The state ranks first overall in highway performance–although its spending per mile is nearly 63 percent less than Michigan. Texas, which has more than 80,000 miles of state highway, ranks far higher than Michigan on both the condition of rural highways and urban highways, yet spends nearly 24 percent less each year per mile.
Neighboring Ohio—with large urban centers of Cincinnati, Cleveland and Columbus—easily thumps Michigan as well. Spending 15 percent less per mile overall, Ohio manages to rank twelve spots higher on rural highways and nine spots higher on urban ones.
And let’s not forget the administrative costs of the state highway system, Michigan lacks efficiency. Administration costs gobble up nearly $10,000 per mile every year. To put that figure in context, consider that it’s ten times as much as Kentucky spends per mile on administration, nearly five times that of Arkansas, nearly three times Texas, more than double that of North Carolina, and close to twice the level of Virginia.
In Michigan, maintenance per mile is nearly $30,000 per year— more than twice as high as fifteen states (including Georgia, North Carolina and South Carolina) and more than triple the cost of eight states.
The fact is, from 1984-2012, across the country, the pace of increase for capital expended on roads and bridges has been nearly triple the inflation during this period (330 percent vs. 121 percent). And this occurred during a stretch where the nation’s population grew by only one-third.
Michigan taxpayers are suffering more than residents in many other states from this spending binge. The more than $113,000 per mile spent each year on state highway capital projects is higher than 33 other states— and it’s more than double the amount of spending per mile in a dozen states.
How did this happen?
One possible problem: many road projects require union wage rates that inflate costs. Get rid of those inflated salaries and more roads can be built with fewer dollars.
Even worse is the money that Michigan has wasted and continues to waste on urban transit systems, such as the notorious People Mover in Detroit, with few riders and spectacular operating costs and subsidies. If existing gas tax dollars went to roads, not white elephants, the crisis would be largely alleviated without higher costs. Also, Michigan would have a better grasp on what funding level is actually needed to maintain and repair its roads and bridges.
In the end, Michigan spends more $200,000 per mile each year for each mile of state –controlled highway—more than thirty other states without much to show for it. It’s time to reign in the spending first—not hike taxes on the working man without a second thought.
This article has been modified from its original version.