Michigan’s Roads Crisis: Study Findings, Conclusions and Where Do We Go From Here? Best Practices Conference Rick Olson, State Representative, 55 th District August 16, 2012

Distrig

Summary of Findings of Studies TF2 Report - $3 billion 2.September, 2011 – House Transportation Committee Transportation Funding Work Group (Schmidt & Olson) - $1.4 billion 3.October, Gov. Snyder’s Work Group on Infrastructure - $1.4 billion

Summary of Findings of Studies 3. March, 2012– House Transportation Committee Transportation Funding Work Group (Schmidt & Olson) – 2012 Update - $1.542 billion $1.8 billion additional cost over the next 12 years because we did not approve dollars in 2011 for 2012 construction

Pavement Condition of Federal Aid Eligible Roads Source: Chesbro, Transportation Asset Management Council

Summary of Findings of Studies 4. $200 million, $400 million, ect. Phase In – Better than NO additional dollars – But, Our average road quality actually gets worse for a few years! We do not reach our 95%/85% “good or fair” goals

Source: MDOT (Chesbro & Ashman)

Summary of Findings of Studies 5. Just Maintain Our Current Poor Quality?

Summary of Findings of Studies 6. March, TRIP Report - “Where Are We Going? Current and Future Pavement and Bridge Conditions, Safety, and Congestion Levels of Michigan’s Roadways and the Impact on Michigan Households, Based on Investment Levels over the Next Decade” – “... each Michigan household could save nearly $2,000 annually by 2022 if funding is increased to allow for significant improvements.”

Anderson Economic Group/ Michigan Chamber Foundation  the quality of Michigan’s roads will decline rapidly if more funding is not raised for additional repairs and maintenance,  fixing the rest of the state’s deteriorating roads and bridges would create an additional 11,000 jobs,

Conclusions Reached 1.We need at least $1.542 additional funding or savings to maintain our roads and bridges and achieve the 95%/85% “good or fair condition” in the next 12 years.

Conclusions Reached 2. To avoid another $1.8 billion cost to the taxpayers caused by delay, action needs to be taken timely in 2012 to avoid missing the 2013 construction year as well. Time is not on our side.

Conclusions Reached 3. We need to be bold in filling the funding gap in one fell swoop, as incrementalism does not achieve the goals.

Conclusions Reached 4. Doing less than the total need would expend considerable political capital and end up disappointing the taxpayers with higher costs - but no better roads. That is, if we are to take action, we might as well achieve the goals, rather than take the potential political heat for the higher costs AND still have poor roads

Conclusions Reached 5. While it will cost motorists money in terms of higher gas taxes and vehicle registration fees, there will be offsetting savings in vehicle repairs, longer life vehicles, safety, etc.

Conclusions Reached There are both short term job benefits and long-term benefits of creating an environment for businesses to flourish from maintaining our roads and bridges.

Thanks! Questions?

Road Funding Package 17 Representatives 13 Senators Bi-partisan A number of best practices bills to get greater value for our money

Gas Tax Convert from 19 cent per gallon to a % of wholesale price. Immediate increase to 28.3 cents. Parity with diesel as the 15 cent per gallon would also go to 28.3 cents. No increase or decrease more than 1 cent per year. Result: increase revenue over half billion dollars.

Vehicle Registration Fees Increase vehicle registration fees an average of 67% on value based fees, and 25% on weight based fee vehicles. Example, my car registration would go from $108 per year to $180. Result: increase revenue over half billion dollars. Reason for change from Governor's "example" of $120 per vehicle.

Commercial Corridor Fund Reason: Make sure these additional user fees actually go to maintain our roads and bridges Over time replace the current Act 51 formula to a system of distribution based more on vehicle miles traveled, i.e., the pressures put on the roads as well as the importance of the roads. Work in progress. Our revised report will provide more information, but all road agencies need more.

Regional Transit Authority Bills Rolling rapid transit, most likely bus rapid transit, but could incorporate other technologies. 4 corridor concept as an overlay on top of current, but could absorb others in the future Funded by up to $1.20 per $1000 of list price vehicle registration fee, subject to super majority vote of the board and approval by the voters of the entire region Governance: 2 from each of the 4 counties, 1 from Detroit, and one non-voting appointed by the Gov.

Timing Goals How Much $ Needed? - September, 2011 Governor’s “Infrastructure Message” – October, 2011 Development of Proposal – January, 2012 Engagement of Interest Groups Legislative Action – Lame Duck, 2012?