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Senate Passes Road Bonding Guardrails

March 10, 2020

Courtesy of MIRS

Senate Republicans Wednesday passed SB 0716 and SCR 22, both objections to Gov. Gretchen Whitmer’s $3.5 billion bonding-for-roads plan.

All the Senate Democrats voted against SB 0716, sponsored by Sen. Roger Victory (R-Hudsonville), which would give the Legislature veto power over the State Transportation Commission bonding more than $100 million in any fiscal year.

SCR 22, sponsored by Sen. Jim Stamas (R-Midland), calls for “responsible” use of the State Transportation Commission’s bonding authority and spells out how the Republicans define that. SCR 22 passed by voice vote.

“These are very important,” Senate Majority Leader Mike Shirkey (R-Clarklake) told reporters. “One establishes the fact that we acknowledge bonding has a use, but not as broad a use as how it’s currently being attempted. The other is that the terms of bonding, in terms of preparing and protecting taxpayers is really important. Both of these things are legislative prerogative — to make sure we’re actually spending money properly.”

“These are making a statement, correct?” MIRS asked.

“Why, have you talked to the Governor to see if she’s going to veto them or not?” Shirkey responded. “I haven’t talked to her about them, so I don’t know.

“There are perfectly legitimate reasons for asset management to use bonding,” the Clarklake Republican said. “It’s not the wholesale application of bonding that is the problem. If you’ve got a $100 million project it helps you a lot more if you break it up into pieces — bond that forward and get it done. That helps you save money. But don’t just do it to spend money. That’s the difference.”

Sen. Curtis Hertel, Jr. (D-East Lansing) said the legislation had no chance of being enacted and if it could be enacted, it shouldn’t be.

“I’m not going to delve heavily into the policy here because I think we all know this legislation is doomed for failure at the end and is more about politics than anything else,” Hertel said. “While I’d like to advise you that not fixing the roads is not a real policy option — or really a good political one — you can make your own decision there.”

“SB 0716 contains an unconstitutional legislative veto that has been clearly defined as unconstitutional under Michigan law,” the East Lansing Democrat continued. “I had really hoped that in the 2018 lame-duck session we’d seen the last of these bills that seek to strip power from those whose offices you used to hold but don’t anymore.”

Stamas made the GOP argument for SCR 22.

“As you know, the Governor last year proposed a massive $2.5 billion tax increase that would have made Michigan’s gas tax the highest in the nation,” Stamas said. “It was overwhelmingly opposed by the Michigan people and even leaders within her own party called it extreme. Earlier this year, just four months after she vetoed a $400 million increase to fix local roads, the Governor took unilateral action to pay for some highway repairs by proposing to bond for $3.5 billion, which would cost over $5 billion to pay off.

“The Michigan Constitution clearly intended the legislature be involved in transportation bonding decisions,” Stamas continued. “SCR 22 would define the Legislature’s intent for road bonding and outline how much we’re willing to spend on a debt payment. We should not exceed the current levels of spending on our state debt and no transportation bonds should exceed the expected life of a road. This resolution states the Legislature’s intent is not to increase future debt spending beyond 2020 levels and not to continue depending on bonds longer than 10 years.

Stamas went on to say Gov. Whitmer should work with the Legislature to find a long-term road-funding solution based on the 2015 road-funding plan.

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