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Gongwer: Road Groups Push Increase Before Next Bidding Season

Thursday, October 18, 2007   (0 Comments)
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Road builders are under no illusion that their drive for more transportation money will be included in the current round of budget talks, but they urged legislators to implement gas tax and registration fee increases they are advocating by the end of the year to be sure money is in place for the next construction season.

Michigan's Transportation Team, which includes road builders, local governments and business groups, said at an event Wednesday that not approving the $1 billion transportation funding increase they have proposed will cost the state some 12,255 jobs, and not all of those will come from road construction.

Mike Nystrom, vice president of government and public relations for the Michigan Infrastructure and Transportation Association, said the state reacts quickly if a company threatens to move and take a few hundred jobs out of the state. "Those losses pale in comparison to the 12,255 jobs being lost by reductions in transportation funding."

The difficulty, he said, is the jobs are going in small batches.   For instance, Mark Johnston with Ajax Paving Industries said his company was moving concrete plants to Florida, where there is work, taking 75 jobs with them.

Mr. Johnston said he expected to see work in the state drop 25 percent next year unless the state increases transportation funding.   "Once we relocate our people to a different state, they'll most likely never come back here," he said.

Dennis Gillow, director of infrastructure for the International Union of Operating Engineers Local 324, said his union expects to see 1 million fewer man hours next year, about a 10 percent drop.   And he said similar drops could continue through 2010.

But Mr. Nystrom said those jobs are only the visible part of the problem and do not include the jobs lost because businesses chose not to locate in the state.  "Businesses don't want to invest in a state that doesn't invest in its infrastructure," he said.

Rich Studley, executive vice president of the Michigan Chamber of Commerce, said the transportation funding proposed is not likely to hurt the business climate because businesses see it as a user fee.   "You can see a tangible return on the investment," he said.   "We're never going to support just throwing money at any problem."

Mr. Studley argued in some ways it was ironic that the transportation funding package had not yet moved through the Legislature.   "You have lawmakers who say they want good roads but don't want to pay for them, but they just voted for a $700 million job killing tax increase," he said of particularly the expansion of the sales tax to services.

He noted that the Chamber did not oppose the income tax increase as part of the budget solution because it used collection infrastructure already in place.

"We made extraordinary efforts to work with the governor and the Legislature to balance the budget," he said.   But so far only the tax increase part of the budget solution has been passed, he said.   The cuts have yet to be seen and the reforms passed to date have been minimal, he said.

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