TABLE OF CONTENTS. Contents

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1 Washtenaw County Road Commission Capital Improvement Plan A 5 year blueprint for planning transportation infrastructure projects under the Road Commission s jurisdiction utilizing allocated resources N. Zeeb Road Ann Arbor, Mi chigan /14/2014

2 TABLE OF CONTENTS Contents To Our Stakeholders 1 The Capital Improvement Plan Capital Improvement Plan Document Unfunded Projects 4 CIP Investment Trend 5 Distribution of Funding Sources 6 7 Expenditures by Category 8 Expenditures by Project Type 9 Asset Management and Performance Road Commission Projects A Word on Funding Additional Road Funding Resources (with weblinks) 28 Appendices 29 A. County Road Association of Michigan Roads & Road Funding in Michigan", 2009 B. Various Sources "Funding Factoids & State Trends", 2013

3 To Our Stakeholders STRATEGIC HIGHLIGHTS The Washtenaw County Road Commission " Capital Improvement Plan (CIP) is a 5 year blueprint for planning transportation infrastructure improvement projects under the Road Commission s jurisdiction utilizing allocated resources. The plan is intendedd to facilitate coordination between capital needs and the operating budget, identify the most economical means of financing capital projects, and increase opportunities for obtaining federal and state aid. In addition, the plan is a tool to relate public road and bridge facilities to other public and private development policies and plans, incorporate community objectives into project planning, and inform the public about future projects and plans. FINANCIAL HIGHLIGHTS Total expenditures in the CIP are projected to be approximately $47 million over the 5 year period. This year s projection is up again from the previous three yearss reflecting modest economic recovery and community agencies working together to capture all available federal and state grants. Most of the planned capital improvements rely on federal and state grants which usually require a local match. The local match dollars are commonly provided by the Road Commission with Michigan Transportation Funds (MTF), or by townships, cities, and villages, or other community partners. OPERATING HIGHLIGHTS The CIP addresses only capital improvements and does not include routine operational, maintenance, or administrative costs. Refer to the Road Commission Annual Budget for information on these expenses ( The annual budget also allocatess resources for capital improvements which are incorporated into this CIP. LOOKING AHEAD The Road Commission would like to recognize all the Local Elected Officials who have stepped up to fund a record amount of road work in Washtenaw County. For the 2013 construction season, nearly every township increased their contributions for road improvements. In addition, Road Commission staff have been tasked with finding and maximizing outside funding sources for the benefit of Washtenaw County at every opportunity. The Road Commission is committed to working with our elected officials in Lansing to increase funding to help improve our deteriorating primary roads and bridges. The Road Commission s goal is to provide safe and reasonable roads at the best value for the residents and motorists of Washtenaw County. Roy D. Townsend, P.E. Managing Director/County Highway Engineer January 14, 2014 Page 1

4 The Capital Improvement Plan The page that follows (page 3) is the document that identifies and outlines the actual capital expenditures included in the plan. Development of the CIP was an iterative and collaborative process whereby the Road Commission solicited input from its stakeholders and evaluated those inputs against available funding resources, priorities, the overall needs of the county, and the consistency of goals of the Road Commission. Transportation capital improvement needs far exceed available resources. This is reflected in the document shown in the Unfunded Projects (page 4). During the course of the year, the Road Commission refers to this document as resources become available or priorities change, and in developing future CIP s. Page 2

5 Capital Improvement Plan Planned Capital Investments Planning Area Project Limits Project Type Construction Year Total Cost ($1,000s) Asset Mgmt/GIS WCRC County GIS/Mapping $1,000 Equipment WCRC County Equipment $1,625 Facility and Grounds WCRC Property Countywide Facility & Grounds $375 Overlay Program Countywide County Resurface $0 Primary Limestone Countywide County Resurface $250 Sealcoat Program Countywide County Resurface $600 Grove Road Non-motorized Ypsilanti Georgina to Rawsonville Non-motorized 2014 $1,142 Lohr/Textile Greenway II Pittsfield Lohr to Ann Arbor-Saline Non-motorized 2014 $1,876 Border to Border, Phase II Countywide Dexter-Huron Metro-Zeeb Non-motorized 2015 $90 Primary Bridge Program Countywide County Bridge $450 Feldkamp Road Bridge Saline Over Saline River Bridge 2014 $950 Jackson Road Bridge Lima Over Mill Creek Bridge - Preserve Deck 2014 $440 McKinley Road Culvert Lima/Sylvan Over Mill Lake Drain Bridge 2014 $200 Wagner Road Culvert Lodi Over Unnamed Tributary Bridge 2014 $275 Austin Road Bridge Saline Over Saline River Bridge 2015 $1,250 Austin Road Bridge Saline Over Bauer Drain Bridge 2015 $1,073 Dixboro Road Bridge Ann Arbor Over Huron River Bridge - Preserve Deck 2015 $592 North Territorial Bridge Dexter Over Huron River Bridge - Preserve Deck 2015 $270 Zeeb Road Bridge Scio Over Huron River Bridge - Preserve Deck 2015 $230 Pavement Preservation STL Countywide County Resurface $1,737 Pavement Preservation STU Countywide County Resurface $2,138 Pavement Preservation TEDF-D Countywide County Resurface $1,037 Resurfacing 3R STL Countywide County Resurface $1,477 Resurfacing 3R STU Countywide County Resurface $2,520 Resurfacing 3R TEDF-D Countywide County Resurface $1,203 Pavement Preservation STL-13 Countywide County Resurface 2014 $695 AA-Saline/Ellsworth/Lohr/etc. Pittsfield & Lodi Various Locations Signal Upgrade 2014 $360 Ann Arbor-Saline Road Pittsfield Oak Valley to Eisenhower Resurface 2014 $1,486 Austin Road Bridgewater At Eisman Safety - Correct Superelev 2014 $199 Austin Road Bridgewater M-52 to Schneider Safety - Culverts/Guardrail 2014 $437 Carpenter Road Pittsfield Bemis to Merritt Safety - Correct Superelev 2014 $436 Carpenter Road Pittsfield Packard to Washtenaw Reconstruction 2014 $2,269 Ellsworth Road Ypsilanti Golfside to Hewitt Resurface 2014 $625 Jennings Road Webster N. Territorial to Twp Line Pave Gravel 2014 $700 Pontiac Trail Salem At Seven Mile Safety - Roundabout 2014 $862 Prospect Road Superior At Cherry Hill Safety - Hillcut/Flasher 2014 $265 Rawsonville Road Augusta Talladay to Judd Resurface 2014 $350 Scio Township SAD Scio Various Roads in Scio Resurface 2014 $4,000 Traffic Calming Program Countywide Various Locations Safety 2014 $500 Hewitt Road Ypsilanti Michigan Ave to Packard Resurface 2015 $625 Huron River Drive/Superior Rd. Ypsilanti Hewitt to Cornell Resurface 2015 $500 Huron Street Ypsilanti Huron River Drive to I-94 Signal Upgrade 2015 $449 Island Lake Road Dexter At Wylie Safety - Hillcut 2015 $438 Plymouth Road Superior At Curtis Safety - Turn Lanes 2015 $263 Plymouth Road Superior At Ford Safety - Turn Lanes/Signal 2015 $563 State Road Pittsfield Morgan to Ellsworth Preliminary Engineering 2015 $250 Textile Intersections Ypsilanti Stony Creek and Hitchingham Safety 2015 $900 Willis Road Augusta Hitchingham to Whittaker Safety 2015 $880 Ann Arbor-Saline Road Lodi At Textile Safety - Turn Lane/Signal 2016 $625 Huron Road/Whittaker Road Ypsilanti Stony Creek to I-94 Resurface 2016 $625 Prospect Road Superior/Ypsilanti Holmes to Geddes Resurface 2016 $250 Rawsonville Road Augusta Oakville-Waltz to Talladay Resurface 2016 $825 Textile Road Lodi Ann Arbor-Saline to Maple Resurface 2016 $500 Carpenter Road York/Pittsfield Judd to Textile Resurface 2017 $625 Whittaker Road Ypsilanti At Merritt Safety - Roundabout 2017 $875 Seven Mile Road Northfield Main to Donna Lane New Construction 2018 $1, Nov-13 Totals $46,979 Washtenaw County Road Commission

6 Unfunded Projects Project Name Project Limit Project Type Township Total Cost ($1,000) Pontiac Trail Between Wild Oak and AA City Reconstruction Ann Arbor $1,500 Huron River Drive Foster to AA City Limits Resurface Ann Arbor $300 Newport Maple to AA City Limits Reconstruction Ann Arbor $300 Woodridge at Goss Intersection Ann Arbor $1,000 Willis Stony Creek to Rawsonville Resurface Augusta $1,800 Rawsonville Judd to Bemis Resurface Augusta $500 Willis Intersection Augusta $1,300 Austin M-52 to Kies Resurface Bridgewater $600 Kies Clinton to Austin Pave Gravel Bridgewater $2,000 McGregor Over Portage Lake Outlet Bridge Dexter $1,000 Dexter Townhall Quigly to County Line Resurface Dexter $900 Fletcher Pleasant Lake to Twp Line Resurface Freedom $900 Klinger Over Mill Creek Bridge Lima $1,000 Liberty Over Mill Creek Bridge Lima $1,000 Scio Church Peckins to Parker Resurface Lima/Freedom $750 Fletcher I-94 to Dexter-Chelsea Pave Gravel Lima $2,000 Ellsworth Ann Arbor-Saline to Maple Pave Gravel Lodi $500 Scio Church At Wagner Intersection Lodi/Scio $1,200 Zeeb Pleasant Lake to Waters Pave Gravel Lodi $2,500 Waterloo Beeman to Werkner Resurface Lyndon $1,500 Sharon Hollow Sherman to Buss Resurface Manchester $900 Schleweis Over Iron Creek Bridge Manchester $500 North Territorial Various Sections in Township Resurface Northfield $600 Six Mile Lakeshore to Nollar Pave Gravel Northfield $6,000 Bemis Saline City Limits to Carpenter Resurface Pittsfield/York $1,000 Platt Bemis to US-12 Resurface Pittsfield $450 Oak Valley Ann Arbor-Saline to Ellsworth Resurface Pittsfield $500 Carpenter Intersection Pittsfield $1,000 Oak Valley Signal Pittsfield $250 Bemis Carpenter to Munger Pave Gravel Pittsfield $1,200 State Michigan Ave to Ellsworth Reconstruction Pittsfield 12,000* Carpenter Michigan Ave to Washtenaw Non-motorized Pittsfield $100 Eight Mile Intersection Salem $1,000 North Pontiac Trail Intersection Salem $1,500 North Curtis Intersection Salem $750 North Territorial Dixboro to Napier Reconstruction Salem $7,000 Seven Mile Pontiac Trail to Angle Reconstruction Salem $1,200 Macon Johnson to Saline City Limits Resurface Saline $300 Parker Liberty to Jackson Resurface Scio/Lima $600 Zeeb Huron River Drive to Joy Resurface Scio $300 Huron River Drive Mast to Metro Park Resurface Scio $400 Wagner Intersection Scio $1,500 Scio-Church Wagner to I-94 Resurface Scio/Lodi $300 Zeeb Over Huron River Bridge Rehabilitation Scio $1,000 Shield Parker to Baker Resurface Scio $150 Shield Over Mill Creek Bridge Scio $1,000 Miller Over Honey Creek Bridge Scio $1,000 Sharon Valley Over Raisin River Bridge Sharon $1,500 Pleasant Lake Sharon Hollow to M-52 Resurface Sharon $900 Superior Huron River to Geddes Resurface Superior $250 Geddes Over Superior No. 1 Drain Bridge Superior $500 Geddes Over Unnamed Drain Bridge Superior $500 Plymouth-Ann Dixboro Road Intersection Superior $2,800 Plymouth-Ann Joy Intersection Superior $750 LeForge Clark to Geddes Resurface Superior $300 Geddes Leforge to Prospect Resurface Superior $300 Old US-12 Rank to Hoppe Resurface Sylvan $450 Scio Church M-52 to Peckins Resurface Sylvan $300 Joy/Huron River Drive Intersection Webster $2,000 North Territorial Donovan to Webster-Church Resurface Webster $600 Arms Creek Bridge Webster $1,000 Daly Intersection Webster $750 Joy Intersection Webster $1,000 Willis Carpenter to Stony Creek Resurface York $400 Dennison Over Saline River Bridge York $900 Sanford Milan-Oakville to Willow Resurface York $750 Willow Stony Creek to Platt Pave Gravel York $1,000 Stony Creek Over Paint Creek Bridge Ypsilanti $500 Wiard Over Tyler Road Bridge Removal Ypsilanti $3,000 Wiard Over Airport Road Bridge Ypsilanti $1,500 Bemis Munger to Stony Creek Pave Gravel Ypsilanti $1,000 Stony Creek Bemis to Whittaker Resurface Ypsilanti $600 Harris Cross to Holmes Resurface Ypsilanti $150 Bemis Stony Creek to Hitchingam Pave Gravel Ypsilanti $2,000 Rawsonville Bemis to Textile Resurface Ypsilanti $500 Harris Grove to Ecorse Resurface Ypsilanti $300 Tuttle Hill Bemis to Martz Pave Gravel Ypsilanti $500 Merritt Stony Creek to Hitchingam Pave Gravel Ypsilanti $1,000 Bemis Whittaker to Rawsonville Pave Gravel Ypsilanti $3,000 Harris Over Railroad Bridge Ypsilanti $500 Merritt Over Paint Creek Bridge Ypsilanti $500 Huron St. Over I-94 Non-Motorized Ypsilanti $2,000 Rawsonville I-94 to Service Drive Resurface Ypsilanti $500 Mansfield Michigan Ave to Congress Reconstruction Ypsilanti $700 TOTAL $88,250 *Does not include utilities or right of way 10-Dec-13

7 The Capital Improvement Plan CAPITAL IMPROVEMENT PLAN INVESTMENT TREND $80, Capital Improvement Plan Investment Trend $70,000 $60,000 CIP (millions) $50,000 $40,000 $30,000 $20,000 $10,000 $ Page 5

8 The Capital Improvement Plan CIP EXPENDITURES BY FUNDING SOURCES PERCENTAGES Fed Aid MTF Local Fed Aid MTF Local Fed Aid MTF Local DISTRIBUTION OF FUNDING SOURCES This chart illustrates how capitalizing on the use of federal funds has allowed the Road Commission to rely less on MTF funds to make capital improvements. Local funding sources (Townships, cities, villages, parks, and other private and public entities) contribute significantly to leveraging federal dollars. The Road Commission strives to capture all available Federal Aid funding sources to apply to the Capital Improvement Plan. It is noteworthy that the charts reflect a significant increase in local contributions. Many of these local contributions include both the match and the federal grants acquired by local agencies and administered in collaboration with the Road Commission Fed Aid MTF Local 2014 Fed Aid MTF Local Page 6

9 The Capital Improvement Plan DISTRIBUTION OF FUNDING SOURCES This chart is another illustration shown in value (millions of dollars) of how capitalizing on the use of federal funds has allowed the Road Commission to rely less on MTF funds to make capital improvements. It is noteworthy that Washtenaw County has been successful in capturing federal money while the availability of such funding is significantly down on a national level. Road agencies are increasingly competing for fewer dollars amongst more transportation interests such as transit, rail, and non motorized. CIP EXPENDITURES BY FUNDING SOURCES VALUES Local MTF Fed Aid CIP YEAR Page 7

10 The Capital Improvement Plan CIP EXPENDITURES BY CATEGORY CIP Facilities 1% CIP Bridges 16% CIP Equipment 4% CIP Roads 79% A large portion of capital improvement expenditures are invested in roads and bridges. A smaller portion is directed to equipment and facilities which are critical to maintaining these investments. (Routine maintenance funding is not includedd in this document.) Page 8

11 The Capital Improvement Plan CIP EXPENDITURES BY PROJECT TYPE Resurfacing 41% Reconstruction 5% Facility 1% Equipment New 4% Construction 5% Non Motorized 6% Safety 22% Bridge 16% The Road Commission attempts to balance expenditures by project type based on the relative priority. The actual expenditures often are influenced by availability and eligibility of resources that can be secured. Page 9

12 Asset Management and Performance PASER ROAD CONDITION RATING The Road Commission has been actively participating in a road condition rating program developed and sponsored by the Michigan Department of Transportation Transportation Asset Management Council. For hard surfaced roads, the program utilizes a condition rating system referred to as the PASER system. This is a visual system that uses a scale from 1 to 10 to rate the roads. Typically the Federal Aid system is rated every two years. Ratings are conducted by team members from WCRC, WATS, and MDOT trained in PASER rating. The next rating cycle for the Federal Aid system is scheduled for Percentage SURFACE CONDITION TREND WCRC JURISDICTION ONLY Good Fair Poor Asset management of hard surfaced roads is a balancing act of maintaining good and fair roads and at the same time, trying to rehabilitate the poor roads. This requires a mix of fixes including routine maintenance, capital preventative maintenance, and structural improvements. Page 10

13 Asset Management and Performance PASER ROAD CONDITION RATING FEDERAL AID ROADS The following graphs show the PASER road rating condition percentages from the previous three cycles for Federal Aid eligible roads that are paved hard surfaces (does not include gravel or local roads). Since implementing asset management, the WCRC has taken an active approach to improve the conditions of the roads where funding eligibility and availability allows. This initiative reflects in the trend towards an increase in the percentage of good ratings in the past five years Good Fair Poor PASER ROAD CONDITION RATING LOCAL ROADS There is no federal and state aid available to maintain, improve, or repair paved local roads. MTF funding received for local roads is not sufficient to cover the cost of pavement maintenance such as surface treatments, crack sealing, or overlays. The WCRC has worked with interested Townships and citizen groups to examine alternative means to provide funding for the upkeep of local roads. In recent years, this effort shows progress with an increase in good roads where the local groups who have pursued alternative funding (Township millages, special assessment districts, bonding, etc) as shown in the graph trend below. However, without adequate funding and investment, the fair roads continue to worsen to poor condition Good Fair Poor Page 11

14 PASER ROAD CONDITION RATING GRAVEL ROADS Gravel roads are not currently being rated under TAMC s PASER rating system. It is expected that a revised rating system specific to gravel roads will be introduced and rating will be implemented for gravel road assets in the near future. Please note that almost half (780 miles) of Washtenaw County Road Commission jurisdiction roads are gravel or limestone, most of which are designated local roads and not eligible for federal or state funding. The WCRC is stepping up efforts to address these unmet needs as well. For example, the WCRC leveraged $600,000 from Enbridge Corporation to improve 20 miles of gravel or limestone roads. In addition, Scio Township has recently introduced a special assessment district throughout its township to address gravel road needs. Many of the townships have long understood the need for maintaining the gravel road system and have routinely contributed to fund ongoing maintenance of these roads. A typical Washtenaw County gravel road. Page 12

15 Asset Management and Performance BRIDGE CONDITION RATING The Washtenaw County Road Commission has 111 bridges under its jurisdiction that are eligible for Federal or State funding. Every other year, the bridges are given a comprehensive condition/safety inspection. Some bridges are inspected every year. Because federal/state aid funding for bridges is very limited and is extremely competitive statewide, the Road Commission faces many challenges in keeping the bridges in a safe and reasonable condition. Number of Bridges BRIDGE CONDITION TREND Good Fair Poor Critical Currently, two bridges are closed due to safety concerns. Update: After the adoption of this CIP, the WCRC received from the Michigan Department of Transportation, Notice of Awards for the funding of 5 different bridge projects in 2016 totaling approximately $3.6 million dollars. This new funding will be reflected in next year s CIP. Page 13

16 Asset Management and Performance OTHER ASSET MANAGEMENT CONSIDERATIONS In addition to roads and bridges, the Road Commission is responsible for many of the ancillary assets associated with roads and bridges. Whenever capital improvement projects are identified, upgrades to these assets are included in the project when possible. These assets include (but are not limited to): Traffic Signs Traffic Signals Pavement Markings Guardrail Culverts Ditches Storm Sewer Structures Pedestrian Facilities Non motorized Facilities For more information on asset management and condition trends both regionally and statewide, visit: Southeast Michigan Council of Governments (SEMCOG) Transportation Asset Management Council (TAMC) Page 14

17 Road Commission s Successful 2013 Season The Washtenaw County Road Commission, in conjunction with our 20 Townships, federal/state and developer funds, the Enbridge agreement, and Special Assessment Districts, has completed one of the largest construction season workloads on record. For the 2013 construction season, nearly every township increased their contributions for road improvements resulting in $6.4M of local dollars towards over 300 road improvement projects, including Collegewood and Senate Avenues, which have been discussed for the past 20 years. The agreement we reached with the Enbridge Pipeline Company allowed us to invest an additional $1.1M in gravel roads and sealcoat; that coupled with our $500k contribution resulted in nearly 50 miles of sealcoat being completed this year. This year s federal/state and developer funds resulted in new roundabouts at the intersection of State Road/Ellsworth Road and Geddes Road/Ridge Road. This outside funding also provided for various other projects such as the replacement of the Ford Boulevard Bridge and a joint three mile non motorized path in Hudson Mills Metropark, a road diet on Michigan Avenue, a CMAQ signal interconnect project on Washtenaw Avenue and over 30 miles of resurfacing was completed in addition to the four Special Assessment District projects. These projects, including numerous others, in addition to our everyday routine maintenance demands, would not have been completed without every employee s active participation. These additional funds from Townships and other sources required our staff to step up and we have delivered with the successful completion of all the projects and duties. With that, I would like to personally thank all the Road Commission employees for their dedicated hard work they have shown this year in accomplishing all of these projects and tasks. What is next? Scio Township just approved a ten year Township wide Special Assessment District (SAD), which assesses every parcel $85/year and will generate over $5M over those ten years. With these funds, they plan to add 6 inches of gravel/limestone to all their local gravel roads, invest in preventative maintenance on their reconstructed subdivision roads, and set up incentive dollars to encourage other subdivision SAD projects. At this year s Annual Township meetings, we encouraged other Townships to pursue the township wide SAD approach and continue to invest in their local road system. The Road Commission is also committed to working with our elected officials in Lansing to increase funding to help improve our deteriorating primary road and bridge network. We will also continue to pursue local countywide funding opportunities. The bottom line is this may have been a record year for projects, but in my opinion we will still have numerous needs and with our excellent work force all we need is more revenue to make this an annual occurrence, which I will continue to pursue. Roy D. Townsend. P.E Managing Director Page 15

18 Road Commission 2013 Projects PLYMOUTH ROADD STATE ROAD AT ELLSWORTH ROAD State Road at Ellsworth Road joint project with the City of Ann Arbor and Charter Township of Pittsfield consisted of constructing a two lane modern roundabout with pedestrian facilities and watermain replacement at one of the area s busiest intersections. The project is located in Pittsfield Towship at the southern border of the City of Ann Arbor near the city airport. This $3 million dollar project was funded by a combination of a federal congestion mitigation and air quality grant (CMAQ), federal urban aid, the City of Ann Arbor, Charter Township of Pittsfield, COSTCO, and Road Commission funding. FORD BOULEVARD BRIDGE OVER RAILROAD The Ford Boulevard Bridge in Ypsilanti Township consisted of the removal and replacement of the existing multi span Ford Blvd Bridge over the MDOT Railroad. The existing bridge was first built in the 1940 s in conjunction with the bomber plant facility and was beginning to fail. This $3 million dollar project was funded with federal, state, Ypsilanti Township, and Road Commission funds. Page 16

19 Road Commission 2013 Projects GEDDES ROAD AT RIDGE ROAD Geddes Road at Ridge Road improvements in Superior Township are in association with the construction of the South Pointe Scholars Charter Academy, K 8 School. The project consisted of reconstruction of an existing fourway stop controlled intersection with a singlelane modern roundabout. In addition, the project included installing a new box culvert on Ridge Road over Fowler Creek. This $1.5 million dollar project was funded by the National Heritage Academy, Superior Township, and the Road Commission. TRAFFIC SIGNAL UPGRADES VARIOUS URBAN LOCATIONS At various urban locations including Washtenaw Avenue, Huron River Drive, Clark Road, Dixboro Road, and Hogback Road, significant traffic signal upgrades were installed. These upgrades included signal interconnectivity, cameras, remote control, and other features that improve traffic flows along major congested corridors. This system will have future capability to allow police and emergency vehicles the ability to pass through a corridor efficiently. This is a multiphase project with the phases implemented this year totaling $500,000 and being funded primarily with a federal congestion mitigation and air quality grant (CMAQ). Page 17

20 Road Commission YOUTH ROADD 2013 Projects PAVEMENT PRESERVATION FEDERAL AID PROGRAM VARIOUS ROADS The Pavement Preservation Program is a program that targets various roads with preventative maintenance treatments (mill and/or overlay) to extend the life of roads that are in good to fair condition. Funding is allocated by the three categories of urban, rural, and designated allseason routes. This $3 million project was funded by Federal, State, and Road Commission funds. The project included paving 18 miles of road in various locations throughout the county. See 2013 Project Map PAVEMENT PRESERVATION ROAD COMMISSION 2013 CHIP SEAL PROGRAM VARIOUS ROADS The 2013 Chip Seal Program was the largest the Road Commission has done in the last 10+ years thanks in part to Enbridge Pipeline Company which signed an agreement in March granting them permission to use specific roads during the spring time weight restrictions in return they agreed to fund the chip seal of 24 miles of these roads. Also, the Road Commission funded an additional $500,000 to chip seal and crack seal an additional 30 miles of primary roads. Various Townships funded an additional 30 miles for chip seal and crack sealing on Local Roads. The chip seal and crack sealing of our roads is a very cost efficient way of extending the pavement life of our system. Ideally we should be chip sealing and crack sealing nearly 100 miles of road system every year at an annual cost of $2 million. Should Lansing elect to provide additional funding, this would be one of the Road Commission s first priorities! Page 18

21 Road Commission 2013 Projects PLYMOUTAD GRAVEL ROAD IMPROVEMENTS VARIOUS ROADS Gravel and limestone roads make up around 50% of Washtenaw County Roads. Most of these roads are not eligible for State or Federal funding. Working closely with our Township partners, the Road Commission has secured agreements for the maintenance and improvements of this important component of our infrastructure. In addition, the WCRC secured $600,000 from the Enbridge Pipeline Corporation to place gravel and limestone in areas impacted by their work as part of the agreement mentioned in the Chip Seal Program above. This year the WCRC placed more than 145,000 tons of gravel and limestone on 30+ miles of various roads throughout the County. See 2013 Project Map PAVEMENT PRESERVATION ROAD COMMISSION 2013 HMA PROGRAM VARIOUS ROADS The Road Commission s HMA Pavement Preservation Program is a program that targets various road projects for which no federal funding is available either due to shortage of funding and/or eligibility of the project. Treatments include crush & shape overlays for roads in distressed condition and structural overlays to extend the life of roads that are in poor condition. Funding this year was primarily various Township sponsored projects and Road Commission MTF funds. Approximately 6 miles of primary roads were restored with this funding. Sample projects included: North Territorial and 7 Mile Road Various locations in Salem and Northfield Township. See 2013 Project Map Page 19

22 Road Commission 2013 Projects MICHIGAN AVENUE HEWITT ROAD TO WALLACE STREET Michigan Avenue in Ypsilanti Township consisted of 1.3 mile of milling, resurfacing, curb and gutter repairs, ADA sidewalk ramps and pavement markings. This project converted the existing four lane road to a three lane configuration intending to improve the safety of the road by providing a centerturn lane and wide shoulders for nonmotorized transportation. This $500,000 project was funded using Federal safety, urban, and Road Commission funds. SANFORD ROAD OVER BUCK CREEK Sanford Road Bridge, between Stony Creek and Willow Roads in York Township had to be closed in June 2012 due to severe deterioration and safety concerns. This closure significantly impacted area farmers dependent on the route for farming activities. In 2013, York Township partnered with the Road Commission to fund the replacement of the failed bridge at a cost of $120,000. To save costs and share resources, the Lenawee County Road Commission partnered with the Washtenaw County Road Commission to provide additional demolition and construction services. The new timber bridge is rated for maximum, legal axle and wheel loads and was reopened in November Page 20

23 Road Commission 2013 Projects MOUTH ROAD YPSILANTI TOWNSHIP BOND PROGRAM PHASE II VARIOUS LOCATIONS SECTIONS 2 & 24 The Ypsilanti Township Bond Program was a project initiated by Ypsilanti Township to resurface numerous roads and other improvements in the township over a two year period. Phase II included local roads in sections 2 & 24 of Ypsilanti Township: Bomber Avenue, Bradley Avenue, Emerson Road, Ide Avenue, Lakeview Avenue, McGregor Rd, Moeller Avenue, Morris Avenue, Outer Lane Drive, Pasadena Road, Snow Avenue, and Wooddale Avenue. This work was performed in cooperation with Ypsilanti Community Utilities Authority who completed water main improvements within the roadways. The road improvements included milling the existing pavement, the placement of a 2 HMA overlay, miscellaneous concrete curb, concrete sidewalk ramps, miscellaneous drainage improvements, shoulders, and project restoration. Additional work associated with the Ypsilanti Bond program included paving Senate Avenue and Collegewood Drive. Phase II project costs of $2,00,000 were funded by Ypsilanti Township. Page 21

24 Road Commission 2013 Projects SPECIAL ASSESSMENT DISTRICTS SCIO TOWNSHIP Scio Township has recognized the need to be proactive in funding the repair of local roads not otherwise eligible for federal funding. Working with township residents, the Township has elected to administer a Special Assessment District (SAD s) under Public Act 188 of 1954 for the purpose of funding local road improvements. This year, the Township s SAD program included the paving of Newman Boulevard, The Glades, Rose Drive, and Parkland Plaza. The scope of the work included crush and shape, cold milling, chip sealing and paving the surface of the roadways with either three or four inches of Hot Mix Asphalt pavement. The Road Commission facilitated the design and construction of these pavement projects. These combined projects totaled over $750,000 in improvements and were funded with monies secured through the Special Assessment District process which is an assessment to residents within the district paid over a 10 year period of time. A Note on Special Assessment Districts The number of Special Assessment Districts (SADs) for road improvements continue to increase each year as property owners in subdivisions are educated on how very little of their tax dollars are collected for local subdivision roads ($1,500/year/mile rural and $3000/year/mile urban). The Road Commission encourages initial information meetings with property owners so they make an informed decision if they are willing to pay a Special Assessment to improve the subdivision roads within their community. This year, Road Commission staff met with property owners in Scio, Dexter, Lodi, and Northfield Townships about potential SADs. As we have experienced, most citizens of Washtenaw County, and probably every other County in Michigan, do not have a thorough understanding of how roads are funded and how very little money is available to maintain their subdivision roads. The SAD process allows the property owner to decide if they are willing to pay for road improvements in their neighborhood Project Summaries Page 22

25 Road Commission 2013 Projects NORTH TERRITORIAL AT WHITMORE LAKE ROAD North Territorial at Whitmore Lake Road intersection improvement project consisted of upgrading the traffic signal and adding left turn lanes on North Territorial Road. In addition, a 1.5 HMA overlay, gravel shoulders, concrete curb and gutter, drainage structure improvements, and pavement markings were a part of this contract. The purpose of the project was to alleviate traffic congestion, improve traffic flow, and improve safety. The project is also part of an overall effort to improve the functionality of North Territorial Road which is a major east west corridor in Washtenaw County. This $300,000 was funded using Federal Aid rural funds with the match provided by the Road Commission. RAWSONVILLE ROAD AT MARTZ ROAD Rawsonville Road at Martz Road intersection project in Ypsilanti Township consisted of constructing center left turn lanes on the north, south and west approach of the intersection and installing a fully actuated traffic signal. The purpose of the project was to improve traffic flow and turning movement to reduce crashes and improve safety This $500,000 project was funded by a Federal safety grant with matching funds provided by Ypsilanti Township. Page 23

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27 A Word on Funding SMART GAS TAX Lawmakers are often criticized for not taking a long term perspective on important issues. But when it comes to gas tax, elected officials in four states this year (Maryland, Massachusetts, Vermont, and Virginia), as well as the District of Columbia have done just that. Michigan: 19 cents/gal. Collecting a fixed rate gas tax (i.e. one that doesn t change from year to year) leaves state transportation departments totally unprepared to deal with rising infrastructure construction costs and the consequence of growing vehicle fuel efficiency cutting into gas sales. At the start of the year, only 14 states handled this reality by levying gas taxes that gradually grow over time along side either gas prices or the general inflation rate in the economy. That number has now risen to 17, with Maryland, Virginia, and now Massachusetts joining that group. There are currently 17 states that have Smarter Gas Taxes, but at this point, Michigan is not one of these states. Eight states have increased their Gas Tax on July 1 of this year, five were automatic increases. Michigan continues to fall further behind on road funding, between gas taxes and toll road revenues as shown on the table. Page 25

28 A Word on Funding As the Road Slowly Turns (Excerpt from Fall Roads in Review WCRC) As Lansing continues to wait for a compromise on the Medicaid expansion issue, the Governor and the four leaders of their respective chambers (Legislative Quadrant) continue a slow discussion on how best to increase funding for transportation. Senate Minority Leader Whitmer (D Ingham) said, We are talking Obviously it s only just broad strokes, but at least some dialogue s happening. Much of the talk revolves around some type of November sales tax increase ballot proposal to backfill any loss of revenue to the General Fund, should the state revert to a wholesale fuel tax, an increase in registration fees and eliminate the sales tax on fuel. The ballot proposal would raise the sales tax by one percentage point to recoup any revenue loss to revenue sharing schools. There has also been some discussion about increasing the sales tax by two percent in order to ensure local government and schools remain whole and recoup past revenue shortages. That option lacks major support, but is being discussed. To meet the deadline for the November ballot, the Legislature would have to move quickly the first week of September when the Senate potentially would be trying to wrap up the Medicaid legislation and pass a transportation plan that week. Needless to say, that was asking a lot. It didn t happen. Page 26

29 Washtenaw County Road Commission 555 N. Zeeb Road Ann Arbor, Michigan Tel Fax Page 27

30 ADDITIONAL ROAD FUNDING REFERENCES A. Michigan Department of Transportation (MDOT) Michigan Transportation Fund Distribution, B. Michigan Municipal League P.A. 51 of 1951 Michigan s Transportation Funding Act, %20 %20PA%2051%20Presentation%20 C. Congressional Budget Office Snapshot of the Highway Trust Fund, March D. Congressional Budget Office Excerpt The Highway Trust Fund and Paying for Highways, May highwayfunding.pdf E. Environmental and Energy Study Institute Issue Brief Excerpt Federal Funding for U.S. Transit and Road Infrastructure, August brief federal funding us transit and roadway infrastructure 08 aug 2013 F. Federal Highway Administration U.S. Department of Transportation web link to 2010 Status of the Nation s Highways, Bridges, and Transit: Condition and Performance Report to Congress G. AASHTO The Voice of Transportation Excerpt Federal Funding Trends, Jack Basso, February 2011: pdf H. U.S. PIRG Education Fund Excerpt Moving Off the Road, A State by State Analysis of the Decline in Driving, Phineas Baxendall, PhD., August Page 28

31 APPENDICES A. County Road Association of Michigan Roads & Road Funding in Michigan, 2009 B. Various Sources Funding Factoids & State Trends, 2013 Page 29

32 A Quick Guide to Roads & Road Funding In Michigan Provided by: The County Road Association of Michigan Township Relations Committee 2009 Visit CRAM online at

33 Table of Contents Subject Page Introduction PART I - Who is responsible for Michigan's roads? The three levels of road jurisdiction in Michigan PART II - Why are Michigan's roads in the shape they are in, and why are other states' roads in better shape? The history of road funding in Michigan Where does road funding come from? State-collected road funding What are the other sources of state road funds, and how are state road funds distributed? MTF distribution table What's wrong with the MTF? Federal funds What happens when there's not enough money for roads? Would economic development solve our road funding problems? PART III - What other road-related issues might you hear about? What about using property taxes for roads? Do Michigan cities & villages supplement state road funds? What about the diesel tax? Development impact fees So, what IS being done? Easy solutions Why not require that truckers reduce the weight they carry? Why not use toll roads? Why not build roads the way Europeans do?

34 Introduction For most public officials in Michigan, it will come as no surprise to learn that the state s transportation infrastructure is in crisis -- the feedback we receive on a daily basis from our constituents confirms this. However, for those not directly involved in maintaining the transportation infrastructure, the causes of this crisis may not be clear. The purpose of this publication is to share with the leaders of Michigan s townships, the County Road Association of Michigan (CRAM) positions on this challenge and what we think could be done about it. We will also explain why we hold these positions, and cite supporting data and statements from many other experts on this subject in the state. Working on behalf of the CRAM Board of Directors, the CRAM Township Relations Committee hopes to foster and/or solidify a spirit of partnership with townships with regard to roads. CRAM believes that Michigan townships are our partners in facing the current road-funding challenge. It is our sincere hope that through sharing this information we will all be better positioned to face this crisis. Sincerely, William Watkins Hillsdale County Board of Road Commissioners Chairman, CRAM Township Relations Committee If you have questions or comments about roads or road funding, please visit the CRAM Web site ( or call or the association office: County Road Association of Michigan (517) craminfo@localroads.net Visit CRAM online at 2

35 Part I: Who is responsible for Michigan's roads? In order to understand the road issues in Michigan, we need to first understand who is responsible for the roads. In Michigan, all roads fall into one of three categories of road jurisdiction: 1. State highways, under the jurisdiction of the Michigan Dept. of Transportation (MDOT): 9,695 miles (8 percent of all roads). 2. County roads, under the jurisdiction of county road commissions: 90,162 miles (75 percent of all roads). In Wayne County, the county roads fall under the jurisdiction of the county Department of Public Services (the road commission was abolished in the 1980s). 3. City or village streets, under the jurisdiction of Michigan s 533 cities and villages: 20,914 miles (17 percent of all roads). Three levels of road jurisdiction in Michigan: City & Village Streets: 17% County Roads: 75% MDOT Roads: 8% Note: Michigan has the eighth largest public road system in the nation, the sixth largest local (county, city and village roads) system and the third largest county system. Michigan's state highway system is the 28th largest in the nation. Here s a little more information about each level of jurisdiction. State Highways State highways fall under the jurisdiction of the Michigan Department of Transportation (MDOT). Included under this heading are all highways with the letters "M", "US" or "I" in their names. Examples include M-55, M-37, US-27, US-12, I-75, I-94, etc. Generally, all freeways fall under MDOT jurisdiction, as do many major inter-county roads. In 65 counties, MDOT contracts with the county road commission to maintain these roads. County Roads Generally, county road commissions have jurisdiction over all roads, except state highways, in all townships in the state. Additionally, some county road commissions have jurisdiction over some of the primary roads in the cities and villages. Over the years, the cities and villages in Michigan have taken jurisdiction over some, or in some cases, all of the roads within their boundaries (except state highways). When a township, or part of a township incorporates and becomes a city or village, the road commission has one year in which to determine which roads to turn over to the new city or village. After that first year, jurisdiction of any road may be transferred either way, if agreed upon by both parties. City & Village Streets The cities and villages have jurisdiction over residential or subdivision streets within their boundaries. Whether a city or village or the road commission has jurisdiction over major streets within the community depends upon a variety of factors and varies from community to community. 3

36 Part II: Why are Michigan's roads in the condition they are in, and why are other states' roads in better shape? The History of Road Funding in Michigan In order to understand where Michigan is today in terms of road funding, it is necessary to understand where we have been in the past. When we look at Michigan's record for the last 45 years, we find that Michigan has done a pretty decent job of funding such important areas as health and education. Roads, unfortunately, are a different story. As the chart on the right indicates, since at least 1964, roads have been Michigan's "forgotten priority" -- Michigan has continuously ranked in the bottom nine states in per capita state and local expenditures on roads. Today, Michigan still ranks in the bottom four states. Per Capita State & Local Expenditures (Michigan s Rank in the Nation) Expenditures Health Education Roads Given this track record, it Source: US Census Bureau should be no surprise that Michigan's roads are in worse shape than those in many other states. Many of the states that, for years, have ranked higher than Michigan in per capita road spending, do not have the freeze/thaw cycles that Michigan experiences each spring and fall, which take a tremendous toll on paved road surfaces. Nor do road agencies in many of these states spend millions of dollars on snowplowing and salting. Others agree: Michigan s roads are in poor condition It is not just Michigan s road agencies that have concluded that Michigan s roads need help. In November 2008, the governor s Transportation Funding Task Force, a non-partisan group made up of four state legislators and nine business, labor and community leaders from across the state, came to the same conclusion. The Task Force, after closely studying roads and road funding for six months, concluded that Michigan needs to double its level of annual road funding just to maintain the existing road system in good condition. The Task Force concluded this would result in spending an additional $3 billion per year on Michigan s roads. Here are a few examples of statements included in the Task Force report: - What the Task Force has determined, after months of hard work and much public input, is that if Michigan s transportation system is to continue to serve the state adequately, our investment in transportation must increase significantly. - Michigan is moving from under-investing in transportation to disinvesting in transportation. - More investment in transportation is absolutely needed. Much more... We must increase investment in transportation soon, or we will put past investment at risk. Another group calling for increased transportation funding is the Michigan Asset Management Council, a group appointed by the governor to oversee the state s efforts to apply the philosophy of asset management to the state s transportation infrastructure. 4

37 The Asset Management Council documented that the road system is rapidly declining. The Council reported in 2008 that there was an 88 percent increase in the number of miles of Michigan s federal-aid eligible roads (those roads on which federal road funding can be spent) that declined from fair or good condition to poor between 2004 and Yet another voice indicating there is a serious problem with Michigan s road system is the Reason Foundation, a Los Angeles and Washington DC-based non-profit think tank. In its 2007 Report on the Performance of State Highway Systems, the foundation concluded that Michigan: Has the 8th worst road system in the nation based on overall performance; Ranks 16th in the nation based on deficient bridges; Has the 4th worst rural interstate conditions; and Has the 8th worst urban interstate conditions. The foundation also ranks Michigan 8th in the nation in congested roads; 10th in the nation in the amount of additional road miles needed; and 6th in the nation in the total cost of road miles needed. And the list goes on. Numerous other national and state-based organizations, including many of the major newspapers in the state, have reached the same conclusion: Michigan s roads are bad and increased funding is needed to address the problem. The Bottom Line It is clear that the condition of Michigan's roads won't catch up with that of roads in other states as long as Michigan ranks in the bottom seven states in per capita road funding. Where does road funding come from? State road funds The two largest sources of road funding in Michigan are the vehicle registration fee and the state-collected gas tax. Traditionally, the gas tax was the largest single source of road funding in Michigan, though vehicle registration fee revenues surpassed the gas tax in 2008, as gas consumption continues to decline statewide. Historically, Michigan's gas tax rate has been below the national average, making it a major contributor to the state's poor showing in per capita road funding comparisons. The state gas tax was last raised more than a decade ago in 1997, when it was increased from 15 cents per gallon to 19 cents. Prior to 1997, it had not been increased since 1984, when it rose from 13 to 15 cents per gallon. So, where does Michigan s gas tax rank compared to other states? We remain below average. The table above lists the gas tax rates for Michigan and our six closest neighbors. Michigan s gas tax rate compared to nearby states Indiana cents* Michigan cents Illinois cents** Minnesota cents Ohio cents Pennsylvania cents Wisconsin cents * = While Indiana s gas tax is lower than Michigan s the state has generated substantial road funding by leasing its toll road to a private company. = Illinois also allows local gas taxes which ** increase its gas-tax rate to well above 19 cents in many counties. 5

38 Besides the gas tax & vehicle registration fee, what are the other sources of state road funds? In addition to the state-collected gas tax and vehicle registration fee, there are a number of other state-collected revenues that contribute to road funding in Michigan. The pie chart at right shows those sources and indicates what percentage of total state road funds they accounted for as of Michigan is one of only nine states in the nation that applies a sales tax (6 percent) to gas and diesel sales. It is interesting to note none of the revenue from that sales tax goes to roads. MTF Sources as % (2008) Diesel Fuel Tax 5.3% Vehicle Reg. Fees 45.1% Diesel Carrier Tax & Licenses 1.9% Misc. Revenue 3.1% Gas Tax 44.6% How are state-collected road funds distributed? How are the state-collected revenues divided among the state, county road commissions and cities & villages? The state Legislature addressed this question through a road-funding formula that is spelled out in Michigan Public Act 51 of In the act, the Legislature established a single "pot" for state-collected road funds known as the Michigan Transportation Fund (MTF). It then created a formula for the distribution of MTF funds. According to the formula, money is first taken off the top of the MTF for a number of items including the Bridge Fund and public transportation. The formula then calls for 39.1 percent of the remaining money to go to MDOT (which has jurisdiction over 8 percent of Michigan's roads), 39.1 percent to go to county road commissions (which have jurisdiction over 75 percent of Michigan's roads) and 21.8 percent to go to cities and villages (which have jurisdiction over 17 percent of Michigan's roads). Note that while MDOT receives 39.1 percent of the MTF funds according to the formula, when you add in the fund deductions that go to MDOT, such as the revenue from a half-penny of gas tax that is dedicated to MDOT bridges and the 1997 truck registration fee increase revenues, MDOT actually receives approximately 41 percent of MTF funds. What's wrong with the MTF? Michigan s MTF dollars are simply not generating enough revenues to adequately maintain the public roads in the state. Nor are these revenues keeping up with inflation. In recent years, MTF revenues have declined. Remember, this problem is compounded by the fact that Michigan's per capita road funding has lagged behind most states for at least 45 years. 6

39 From 1998 through 2008, MTF grew a net total of 7 percent statewide (see chart at right). This is significantly lower than the combined rate of inflation for these 11 years. In each of the last three years, MTF has actually declined by approximately 4 percent per year, as the chart shows. But that's not the whole story. Many of the costs associated with critical road maintenance activities are increasing far faster than the consumer rate of inflation. Here are some examples from one Southeast Michigan road commission for the period from 1998 through 2008: Item Percentage increase, '98-'08 12-yard snowplow/dump truck (purchase price) % Diesel fuel % Gasoline % Asphalt % Gravel % Guardrail & hardware % Plow blades % U-channel sign posts % Traffic signal cable % NOTE: Fuel taxes are "flat" taxes: They do not increase with the price of gas or diesel or with inflation. That means, assuming gas and diesel sales remain fairly steady, each year the gas and diesel tax revenues have less and less buying power. That's because no additional dollars are generated, while all the costs these revenues pay for increase from year to year. It also means that road agencies do not receive additional funding when gas or diesel prices go up. Federal Funds Most road agencies in Michigan rely on federal road funding, generated by the 18.4-cent federal gas tax, for major road improvements, such as road widening projects. While federal funds coming to Michigan have increased slightly in the last couple of years, the increase has been minimal for most road commissions. That's because the federal road funds coming to Michigan are split among the Michigan Department of Transportation (MDOT), county road commissions and cities and villages. After deductions for special programs and "earmark" grants, legislation and tradition set the division as follows: 75% = MDOT 25% = Divided among county road commissions, cities and villages statewide That means by the time the 25 percent local portion of any increase in federal road funding is spread among the 83 county road agencies and 533 cities and villages in Michigan, no single agency receives a very substantial amount. Additionally, Michigan is a donor when it comes to federal funds: We send more money to Washington DC than we get back. For every dollar Michigan sends to Washington DC in road funding, we get back 92 cents. So, what happens when there's not enough money for roads? When there s not enough money to adequately maintain roads, the road surfaces deteriorate, winter road maintenance services are reduced and, in urban areas, roads become increasingly congested. This ultimately has a negative impact on both business and quality of life. And... 7

40 Because the road agencies can't afford to spend enough in any community, the communities get frustrated and accuse the road agencies of spending all their money in other communities. And... Road agencies must compete with each other for the scarce road dollars. This undermines the cooperative spirit necessary to most efficiently maintain the road system on which Michigan relies. What if we could just stimulate economic development? Would that solve our road problems? Over the last decade, prior to the current economic downturn, some Michigan counties experienced tremendous growth. As a result of the growth, these counties received new revenue from taxes associated with all the growth. In some parts of the state, there was development of new office complexes, new commercial developments, tremendous new growth in the industrial sector and explosive growth in residential development. However, in most cases, this development resulted in no increase in funding for roads. Why? New development produces tax revenues in three areas: 1. Property taxes -- from new buildings 2. Income taxes -- from new jobs 3. Sales taxes -- from commerce at the new commercial developments How much of this tax revenue went to either MDOT or the county road commissions to address the traffic problems resulting from the growth? Except for the 17 Michigan counties with property tax millages dedicated specifically to roads, the county road commissions and MDOT get NO revenue from new development. The 17 counties with road millages are: Allegan, Baraga, Charlevoix, Chippewa, Crawford, Gladwin, Houghton, Huron, Iron, Leelanau, Midland, Montmorency, Ontonagon, Sanilac, St. Joseph, Tuscola and Van Buren. Millage revenue in these counties is spent on county roads and city or village streets but not state highways. Many townships in Michigan also contribute to the cost of maintaining and improving the roads within their borders. Some do this through a dedicated road millage, while others contribute dollars from their general funds on a project-by-project basis. Obviously, townships that use revenues generated by property taxes to contribute to the cost of road maintenance or road improvements, saw a road-related benefit from the new development. Township contributions In light of the insufficient level of state-collected road funding, the partnerships between road commissions and townships has enabled many road commissions to complete projects that otherwise would not have been undertaken for years, if at all. In 2007, townships statewide supplemented road commission budgets by a total of $102 million, with townships in 82 counties contributing to their road commission s efforts. 8

41 Part III: What other road-related issues might you hear about? What about using property taxes for roads? Though the largest sources of road funding in Michigan are the state-collected gas tax and vehicle registration fee, some local governmental agencies have already been forced to turn to the property tax for supplemental road funds. While road commissions have no taxing authority, as noted above, in 17 counties, the voters have approved a countywide property tax millage dedicated to roads. Some townships and many cities and villages are already doing this as well. Why? Necessity, resulting from decades of inadequate road funding and demand from citizens for better roads. The net result of these efforts is a shifting of the road funding burden partially onto local property taxes. Are property taxes the best way to pay for roads? Which is the most equitable way to raise money for roads, fuel taxes or property taxes? But there is an even more basic question implied in this question: Should road funding be based on: A. The extent to which you use the roads; OR B. The value of your property? Which method hits the elderly and those on fixed incomes the hardest? The County Road Association of Michigan (CRAM) believes the fuel tax is the most equitable way to fund roads in Michigan, because: A. The fuel taxes are "user" taxes (the more you use the roads, the more you pay); and B. Michigan has not exhausted the fuel tax as a funding mechanism (Michigan s fuel taxes remain below the national average and well below many of our neighboring states). Are Michigan cities & villages currently supplementing their state road funds? Yes. Michigan's cities and villages already subsidize their streets. They discovered long ago that MTF funds are not adequate to address their road needs. On average, Michigan cities and villages receive nearly half of their road funding from a source other than the MTF. That other source is typically local taxes of one form or another. In other words, Michigan's cities and villages have already been forced to turn to sources other than the state-collected road funds for nearly half of their road funding needs. In some of these communities, dedicated property tax millages are already used for roads. In others, the community uses general-fund monies for road maintenance. As noted above, road commissions have no taxing authority. They cannot raise property taxes, and they have no general fund that could be used to supplement their state-collected revenues. Unless they receive contributions from townships, road commissions must operate with what they receive from the state (MTF), which, as in the case of the cities and villages, is inadequate to meet road needs. What about the diesel tax? Currently, Michigan charges 15 cents tax per gallon of diesel fuel, but 19 cents per gallon of gasoline. According to MDOT, a Federal Highway Administration study estimates that 40 percent of the cost of building and repairing roads is attributable to trucks, but the revenue generated by the 15-cent tax on diesel 9

42 accounts for only 15 percent of the funds needed for these activities. In other words, trucks are not paying their fair share to build and maintain roads in Michigan. For the last several years, a proposal has been discussed in Lansing to raise the diesel tax. CRAM believes the diesel tax should be raised so it is equal to the gas tax. If the diesel tax is increased, CRAM would like the revenues to be funneled through the MTF road-funding formula, as with most other state-collected road funding, so that all levels of roads in Michigan benefit equally. A 4-cent diesel tax increase would generate approximately $40 million statewide. Road Commissions would receive 39.1 percent of that, or about $15.6 million collectively. Thus, no individual road commission would see a large increase in funding from such an increase, but every little bit helps. CRAM and its members believe raising the diesel tax is the equitable thing to do. Development impact fees Over the years there have been several attempts to authorize certain governing bodies to levy fees on developers to cover the costs of road improvements necessitated by their developments. These fees, which are used in other parts of the country, are known as development impact fees. CRAM supports this idea and has been involved in this discussion for more than a decade. To date there has not been enough support in the state Legislature to enact the necessary laws to make development impact fees possible in Michigan. So, what is being done? Currently, three efforts are underway in Michigan to attempt to address the road funding crisis the state is facing. They are: 1. A vast consortium, known as the Michigan Transportation Team (MTT) is pursuing the "Drive MI" campaign, aimed at raising Michigan's gas and diesel taxes and vehicle registration fee. CRAM is a member of this team and actively supports the effort. In addition to CRAM, team members include the Michigan Infrastructure-Transportation Association, Michigan Municipal League, Michigan Chamber of Commerce, the International Brotherhood of Teamsters, the Michigan Farm Bureau, Michigan Public Transit Association, Michigan Retailers Association and many others. 2. As one element of the Drive MI effort, a group of Michigan business, government and civic leaders created a group known as Businesses for Better Transportation (BBT), which is seeking to establish local funding options that would allow counties to raise money on their own to address transportation issues, such as congestion or public transportation. The effort is supported by many road commissions across the state as well as organizations such as the Michigan Association of Counties and many others. BBT was able to introduce enabling legislation in 2008 that would have allowed counties to seek voter approval for a local-option gas and/or diesel tax, local-option vehicle registration fee, local-option license fee, local-option property transfer fee and a local-option sales tax. Counties could choose from this menu of options and pursue one or more that meet their needs. While the legislation was not enacted in 2008, it is expected to be reintroduced in Each year, a portion of the MTF dollars is diverted from road and transit needs to fund non-transportation state departments through what are known as interdepartmental grants or IDGs. In theory the IDGs are used to refund those departments for the collection of monies that go into the MTF, such as the Secretary of State s Office, which collects vehicle registration fees. However, CRAM and many others feel these departments receive more than is warranted by the cost of collecting these dollars. As a result, CRAM and others are working in Lansing to reduce the IDGs, so more transportation dollars are used for true transportation purposes. 10

43 Easy Solutions? "There is always an easy solution to every human problem neat, plausible and wrong." -H.L. Mencken, 1949 When it comes to road funding, H.L. Mencken was certainly correct -- there are no easy solutions. We must urge our state legislators to increase the gas and diesel taxes and vehicle registration fee and implement reforms to ensure transportation funding stays in the MTF. Here are some of the easy solutions that are frequently proposed, with an explanation of why they are wrong. "Why not require truckers to reduce the weight they carry?" It is true that heavy trucks do far more damage to the road surface than cars. It is also true that Michigan allows heavier trucks than most states (164,000 pounds vs. 80,000 pounds). However, studies have indicated that road damage is related more to axle load than to gross weight. Michigan's axle load restrictions are comparable to most other states. Additionally, if Michigan reduced the gross vehicle weight allowed, it is estimated there could be as many as 12,000 to 15,000 new trucks added to the roads. CRAM believes heavier trucks do far greater damage to the roads than cars and don't pay their fair share for road upkeep. Consequently, CRAM believes heavy trucks should pay a fairer share. "Why not use toll roads?" Below are seven reasons we do not use toll roads in Michigan. 1. Only freeways can be made toll roads. 2. Typically, tolls collected on toll roads are used to maintain the toll roads, not other roads. 3. Freeways represent 1 percent of Michigan's public road system. If all Michigan freeways became toll roads, 99 percent of Michigan's public road system would remain underfunded. 4. States with toll roads, such as Ohio and Pennsylvania, have a higher gas tax than Michigan to maintain their other roads. 5. Toll roads are especially effective for states with high pass-through traffic. Michigan is a peninsular state, with little pass-through traffic. 6. To avoid tolls, some motorists would drive on local roads, increasing the burden on those roads. 7. Retrofitting existing freeways to be toll roads could be expensive. "Why not just build roads to European standards?" It's true that in some European countries, roads are built to higher standards and last longer than the roads built in the United States. But, they also cost considerably more. What is the cost difference? It is estimated that building roads to the European standard would increase project costs by 50 to 75 percent. If Michigan road agencies opted to build roads to European standards, they would only be able to reconstruct half as many roads, meaning the rest of our roads would deteriorate to an even worse condition before they could be repaired. Additionally, it is interesting to note that the cost of gas in Europe is more than $5 per gallon -- mainly because fuel taxes there are much higher. We hope this information has helped to illuminate the problems Michigan s county road commissions face when it comes to road funding. CRAM hopes Michigan s townships will join us to work together to find solutions that result in better roads across our great state.

44 Xxxxx Funding Factoids

45 State Trends Federal Funds for Michigan: 75% MDOT 25% Divided among 83 Counties, and 533 Cities & Villages