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FOR IMMEDIATE RELEASE: Aug 15. 2013
Richardville Is Right: State Has “Structural Problem” — But “Shell Game” Is Not the Answer
Michigan Municipal League Statement on Road Funding Proposal
This statement is from Linden Mayor David Lossing, President of the Michigan Municipal League. He is commenting on a proposal being considered by the Legislature to change how roads and transportation services are funded in Michigan, including a possible increase in the state sales tax. The League strongly supports increasing funding for Michigan’s roads and transit systems, but believes the current proposal being discussed in Lansing is little more than a “shell game” that fails to address the larger issue: how to fund all local government services in the future, including roads.
“We agree with Senate Majority Leader Randy Richardville that Michigan has a ‘structural problem’ in how it funds roads and education. But a proposal that would take money from schools and cities to fund roads fails to solve the state’s broken, antiquated municipal finance system. Frankly, it’s just a shell game. For years, local communities have urged legislators to address Michigan’s broken municipal finance model. In the wake of a decade of property value declines and $6 billion in cuts to local revenue sharing made by countless legislatures and administrations, many communities are operating on a fraction of the budgets they had a few years ago. And because of the structural limitations of Proposal A and the Headlee Amendment, those levels have become the new ‘baseline.’ So no community’s property revenues can increase by more than the rate of inflation or 5 percent, whichever is less. Communities that have lost 20 percent, 40 percent or more of their property value will take decades to return to their funding levels of just years before. As a result of all of this, local communities in Michigan no longer control their own fiscal destinies.
"And now comes this new sales tax proposal, which appears to be little more than a shell game of transferring money from local governments and local schools to state government to fix roads. We need new money for roads, there is no disputing that. But given the state’s ‘F’ grade for a track record of keeping its statutory promises, local and school leaders, and citizens have every right to call foul on this plan, which still doesn’t address how the funds would be replaced. The Michigan Municipal League supports increasing funding for roads, but we also believe that improving roads at the cost of other services isn’t going to improve anyone’s quality of life or create economic prosperity. Addressing the core issue of how we fund local services in Michigan must be the focus of this proposal, not shifting funds from one place to another.”
Michigan Municipal League advocates on behalf of its member communities in Lansing, Washington, D.C., and the courts; provides educational opportunities for elected and appointed municipal officials; and assists municipal leaders in administering services to their communities through League programs and services.