Construction and Government

Local governments spending more on streets

Survey shows some are spending more than they get in state gas taxes.

August 23, 2013
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Local governments spending more on streets
Automotive repairs due to road conditions are an added cost for drivers as state and local road funding is well below budgeted costs. Thinkstock.com

A Grand Valley Metro Council survey explains why local public officials are looking for new ways to pay for street and road work.

“Public Act 51 is not keeping up with demand for fiscal support of our road system, and local units are being called upon to provide greater local general fund support for road maintenance and construction,” wrote GVMC Executive Director John Weiss in his weekly report.

“Without a doubt, the data proves local governments and taxpayers are already partners with the state in maintaining our roads,” he added.

Public Act 51 allows the state to collect a fuel tax on every gallon of gasoline and diesel sold in Michigan. The state distributes a portion of that revenue to road commissions and municipalities to help cover the cost of maintaining and building local streets and roads.

But the GVMC survey clearly showed the funds coming from the state aren’t nearly enough to meet the need, so local governments either have to pay a bigger share, or possibly delay the road work.

The council recently surveyed 12 cities in the metro area and found they received $19 million in gas-tax revenue but had to spend $13 million in local funds to get the work done. State revenue only accounted for 59 percent of the $32 million needed, so municipalities had to come up with 41 percent.

“In most communities the local investment comes directly from the community’s general fund and must compete with other essential services like police and fire,” said Weiss.

“Our analysis found in one-third of the communities, the local spending is more than 100 percent of the revenues they receive from Act 51. In two of those cities, it exceeded 200 percent,” he added.

Those two were Hastings and Middleville at 266 percent and 226 percent, respectively. Grandville and East Grand Rapids both topped the 100 percent mark. Only Greenville and Hudsonville spent less than the 41 percent average. Grand Rapids spent 56 percent, or $7.34 million, the most of the cities.

The average amount the dozen cities received in gas-tax revenue was $3.46 million, while each spent an average of $2.18 million.

“As we can see from the reported data, significant local dollars are being used to maintain our street system. Other data also shows that we continue to lose the battle as, overall, our street infrastructure continues to deteriorate,” said Weiss of a situation where a third of all roads in the area are in poor condition.

“Public Act 51 is not keeping up with demand for fiscal support of our road system, and local units are being called upon to provide greater local general-fund support for road maintenance and construction.”

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