Snyder wants to spend revenue from new online sales tax on road improvements | Michigan Radio
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Snyder wants to spend revenue from new online sales tax on road improvements

Aug 14, 2018

Michigan decided last week to collect sales tax from online businesses -- which could increase the state's tax revenue by almost $250 million in the next three years.

But the question now is what to do with that extra money.

Governor Rick Snyder and his administration are urging Michigan lawmakers to put it towards fixing the roads. However, the state's education groups think it should go to public schools. Thanks to a 1994 ballot proposal passed by Michigan voters, schools receive the majority of the state's current sales tax money.

Lance Binoneimi is the Vice President of Government Affairs at the Michigan Infrastructure and Transportation Association. He’s glad Snyder wants these funds to go to the roads -- he says they just keep getting worse. He says legislators need to figure out where the money can be best spent.  

“[Infrastructure] needs continue to grow with lack of investment into them, so policy makers will need to decide, you know, which is a top priority for them,” Binoneimi says.

But people in the education sector say the money could go a long way in Michigan schools.

Peter Spadafore is the Associate Executive Director of the Michigan Association of Superintendents. He says the extra $250 million could fund a third of Michigan’s special education program.

Spadafore also worries putting the new revenue towards roads would be unfair to voters.

“With folks understanding, as far back as 1994, that the bulk of it was going to go to education, and then finding out that it won't -- it feels like another lottery bait and switch,” he says.

State Treasurer Nick Khouri says putting the new revenue towards roads would not take any money away from schools, since it wasn’t part of the budget for either issue. He also says putting this money into the roads is well within the bounds of the state constitution.

“This absolutely meets the constitutional requirements… if it’s spent on roads, we will still be way in excess of the constitutional minimum requirements of K-12 funding,” Khouri says. He’s hoping there will be a law regarding these tax dollars on the books by the end of the year.