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Metallurgical engineer, troublemaker....

Michigan Political Math: $ 1.2 Billion = $ 1.08 Billion

Mass Transit Skims $ 120 Million from Proposal 2015-01 Road Work Funds

Train Wreck ImageEver hear of the Michigan Comprehensive Transportation Fund? Ten cents of every Michigan fuel tax dollar gets diverted to this mass transportation slush fund.  It is only just behind the sales tax as a diversion of your current fuel tax dollars from Michigan’s roads.

All motor vehicle fuel taxes collected in the State of Michigan are first deposited into the Michigan Transportation Fund. Then MCL 247.660 (1)(f) (Public Act 51 of 1951) dictates that 10% of the funds deposited in the Michigan Transportation Fund be immediately transferred to the Comprehensive Transportation Fund. The amended version of MCL 247.660 you are being offered in Proposal 2015-01 has the very same section (1)(f), making the same 10% immediate diversion.

So the $ 1.2 billion that Proposal 2015-01 supporters are promising you for road work is actually only $ 1.08 billion.  Kirk T. Steudle, P.E. gets a whole new stash to maintain and expand his stable of rotting train cars, $ 120 million that cannot be spent on the roads by law.  $ 120 million that gets skimmed from the $ 1.2 billion you are being promised for the roads.  And no, it is not skimmed from the $ 800 million that Proposal 2015-01 dedicates to the Democratic base.

Now you now know how Michigan political math works in the age of Common Core.  Pay $ 2 billion for roads, get $ 1 billion in road work.

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We’re 31st!

FFI 2015 Overall Rankings Screen-Shot

The twenty-five year old John Locke Foundation has just released its First in Freedom Index for 2015. The Freedom Index ranks states for the level of freedom allowed their citizens in four weighted areas of policy:

Fiscal: 50%
Education: 20%
Regulation: 20%
Health Care: 10%

Michigan ranks 31st overall among the states in the Freedom Index. Dismal per capita levels of state taxes, spending, and regulation weighed down Michigan’s rankings. Michigan’s ranking in the individual policy categories are:

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Happy Deer in Michigan

Michigan Hunters Not So Happy

Happy Deer

DNR just slyly reported that Michigan hunting license sales dropped to 729,000 in 2014, a 4.2% drop from 2013 sales and the all time low in data extending way back to 1958. This drop is even worse than the numbers suggest, since the new HB 4668 hunting license rules require base licenses for hunting activities which did not require licenses in previous years. And if you believe President Obama and his statistical mathmagicians, the U.S. economy surged at a 5% GDP growth rate in 2014Q3 just before Michigan’s traditional firearms deer season. Michigan’s population increased by 11,684 people in 2014, the third consecutive annual increase. So the number of hunters should have increased in 2014? But the number of hunters in Michigan dropped, and hunter numbers declined because license fees skyrocketed under HB 4668 of 2013.

The most popular hunting license prices increased 50 – 100 % under the new 2014 fee schedule, although a direct comparison is not possible because the licenses were restructured under HB 4668 to ‘simplify’ the license schedule. Even though the DNR has not released license sales dollar amounts yet, we can still sketch out the doleful effect of the DNR hunting license fee increases on Michigan’s staggering economy.

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Another Glitch in the ‘Road’ Tax Package

Legislative Craftsmanship at its Finest

Crying CEO or managerA week ago we found out that the new road tax package vehicle registration fee system would end its Federal tax deductibility.  Now Gongwer News Service is reporting another glitch, this time in the gasoline sales tax provisions of the road tax package:

Fix Planned to Correct Sales Tax Problem in Roads Plan

The administration of Governor Rick Snyder will seek legislation to correct a potential problem in the road funding plan that as written would lift the sales tax off of gasoline only for motor vehicles, but not for boats, snowmobiles and other non-road purposes like generators and gasoline-powered equipment.

As currently constructed, that would create a mess for retailers who theoretically would have to determine whether or not to charge the sales tax and even ask customers filling up a gasoline can what the intended use of the purchase is. The Citizens Research Council of Michigan, as part of a broad analysis it is conducting on the road funding plan, noted the quirk and provided the information to Gongwer News Service.

It will be interesting to see how Governor Snyder fixes this.  Purchasing gasoline for your boat or ORV could become a really entertaining bureaucratic exercise. Ready for the ‘Gasoline Police’? Think of the new forms to be filled out.

CRCoM is a collection of the usual corporate interests orbiting Michigan government. Not certain why they would have ratted out this bungle to Gongwer, but it does suggest a certain degree of unease among the establishment.

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AgitProp in the 21st Century

Mercenary Research in the Service of Greed

News stories on the Michigan road tax proposal are replete with compelling, eye popping factoids about the costs poor roads impose on Michigan drivers. These factoids are so compelling that our colorless Governor cites them to sway voters in the upcoming sales tax proposal debate. Some examples:

  • An inadequate transportation system costs Michigan residents a total of $7.7 billion every year
  • Driving on rough roads costs Michigan motorists a total of $2.3 billion annually in extra vehicle operating costs
  • Driving on rough roads costs the average Detroit urban area motorist $536 annually in extra vehicle operating costs
  • Driving on rough roads costs the average Michigan motorist $357 annually in extra vehicle operating costs

You are expected to conclude that a 16.67% sales tax increase is a just trifle to escape these ghastly financial burdens. These factoids are always attributed to “TRIP, a national nonprofit transportation research organization”. Sounds like an independent, credible source – right? The adjectives ‘nonprofit’ and ‘research’ give you a high level of confidence in their pronouncements? Perhaps you should dig a little deeper than our conniving politicians and their lazy media scribes.  The TRIP report they are mining for these factoids is: MI_Transportation_By_The_Numbers_TRIP_Report_Jan_2014

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Rotten Fish in Michigan

DNR Fee Increase Backfires

Politicians of all stripes are rooting around for fresh money to fulfill past, present, and future promises lately, figuring that the economy is so hot that their depredations will go unnoticed and have no consequences. Let’s take a look at a Michigan example: the increase in license fees for hunting and fishing which the Legislature authorized in 2013 and which took effect in 2014.

The most popular hunting and fishing license prices doubled under the new fee schedule, although a direct comparison is not possible because the licenses were restructured to ‘simplify’ the license schedule. Governor Snyder’s goal for these increases was to raise an additional $ 18.1 million dollars annually for the DNR. The Senate Fiscal Agency benchmarked the anticipated annual increase at $ 19.7 million.

These are fees, paid voluntarily, so why should we care? Only taxes matter? The State of Michigan has been reducing the amount of money appropriated to the DNR from tax revenues since 2000, a reduction that now amounts to about 70%. So fees are now required to replace taxes. A common story across the United States. Fees play better with voters than taxes.

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