Legislative Update

Federal Transportation Funding (SAFETEA-LU) & Hurricane Katrina

The recent catastrophic disaster resulting from Hurricane Katrina has caused some in Washington D.C. to suggest that funds recently authorized in the six-year transportation act (SAFETEA-LU) be reallocated to offset the cost of disaster relief for the gulf coast region. However, there are many in leadership positions in Washington who are standing firm to protect the hard fought funding formula as it was passed in SAFETEA-LU.

The proposal to eliminate earmarks and transfer the funds to disaster relief would significantly disrupt the delicate highway formula balance that was reached in SAFETEA-LU, which ultimately ensured a minimum rate of return for both “donee and donor” states.

Additionally, SAFETEA-LU specifically provides $100 million dollars per year in funding from the Highway Trust Fund for highway and bridge repair and reconstruction caused by such disasters.

The MITA national affiliate The American Road & Transportation Builders Association (ARTBA) suggests that most of these diversion proposals are political grand standing. However, MITA will keep you updated if and when any of these proposals seem to gain any momentum.

State Panel Reports Sewage Project Bills

The Senate Natural Resources and Environmental Affairs Committee reported House Bills 4572-73, which allow the Great Lakes Water Quality Bonds (Proposal 2 of 2002) to be used for the design of combined sewer separation and other sewer improvement projects. Under these bills, $40 million could be used as grants, not as state revolving fund loans, for the planning phase of sewer projects around the state. Each grant would be limited to a maximum of $1 million.

Another requirement within this legislation is that municipalities receiving these grants must begin and complete construction within very specific timelines, otherwise, they will be required to repay the grant at an interest rate of 8% per year.

It is the hope of every supporting group that these grants will ultimately help get even more state revolving fund loans out into the communities and thus get more sewer construction projects moving forward.

MITA Staff to Meet with Governor Granholm

MITA’s Executive Vice President Bob Patzer and Vice President of Government and Public Relations Mike Nystrom plan to meet with Governor Granholm next week to discuss her proposed $400 million in bonded transportation construction projects.

Although MITA is enthusiastic about the infusion of $400 million into the industry, there are also several concerns pertaining to the long-term direction of the administration with regard to transportation related funding.

In our visit, we will convey to the governor our gratification for her interest in stimulating construction related activity and jobs, and will also seek a clear direction as to where the administration will head over the course of the next few years with regard to a comprehensive long-term funding plan for Michigan’s transportation system.

MITA will keep you updated on this proposal as well as any long-term funding proposals as they are developed.

Detroit Free Press Editorial Supports Gas Tax Boost

A Sunday, October 9, 2005 editorial of the Detroit Free Press ( click here to read the article) suggests that our state legislature, the governor and MDOT need to reassess the state’s transportation program and the significant needs that exist throughout the state.

In this editorial the Free Press suggests that a state gas tax hike must be evaluated and strongly considered in the near term future.

MITA will be working hard with newspaper editorial boards throughout the state to push for a comprehensive funding increase for our state transportation system over the course of the next two years.

Watch your mail for information regarding this important endeavor.

Please contact Mike Nystrom at MITA with any questions, concerns or comments regarding any of the above issues.