Small Business Disappointed with New Road Funding Proposal

Date: January 13, 2015

Small Business Disappointed with New Road Funding Proposal

While expressing early optimism as
the lame duck road funding proposal moved through conference committee during
the last week of the 2014 session, the state’s leading small business
organization, the National Federation of Independent Business (NFIB), said
it is disappointed with the final product.

Early reports indicated
that the proposal would end the current practice of charging a sales tax on
fuel at the pump that does not go to road funding and shift the money back
to roads where it belongs. Local governments and schools would be
reimbursed the lost money via a state-wide ballot proposal to increase the
overall sales tax by a penny or 7 percent from the current 6 percent. The gas
tax would remain the same and roads would see additional funding.

However, when the dust
settled, the final proposal veered from the encouraging outline presented
originally into a proposal that reflected political horse-trading and caving in
to Democrat demands for higher taxes and pet programs and projects. In
addition to increasing the gas tax and registration fees, the proposal is tied
to reinstating the 20 percent earned income tax credit, a new internet tax
proposal, and a set aside program for selected businesses.

Worst of all, as part of
the deal to get the necessary votes to pass the final proposal, it appears that
the Governor has indicated he will veto any bill that would end Michigan’s
wasteful and unfair prevailing wage law. This last concession is a major
handout to construction trade unions at the expense of merit shop and small
business contractors. It also encourages the overcharging of taxpayers on
publicly funded construction projects by requiring that union scale wages be
paid regardless of whether a contractor has non-union employees.

While disappointed with the
final proposal, NFIB’s official position of support or opposition to the plan
will be decided by NFIB’s small business members when it is put in front of
them for a vote. NFIB determines policy positions on issues on behalf of its
members by a voting process that allows all members a voice in the process. A
survey on the road funding plan and the May, 2015 sales tax ballot proposal
will be sent out to the members in the coming weeks.

Related Content: Small Business News | Michigan

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