Did Whitmer 'cave'?
The first-term Democrat unveiled a budget in March that proposed to fix roads by raising fuel taxes from 26.3-cents to 71.3-cents per gallon in three phases and would have generated $2.5 billion a year once fully implemented in 2021.
The Republican-led Legislature balked at the fuel tax plan. GOP leaders have not publicly proposed any long-term road funding alternatives but claim they have presented alternative options to Whitmer during private negotiations.
Shirkey said last month he expected a final road funding deal would include a gas tax increase of less than 10 cents per gallon spread out over three years. He also has pushed a plan to refinance debt in the state’s teacher pension system to free up cash for roads, which Whitmer has said she does not want to do.
The 45-cent fuel tax hike was a linchpin of Whitmer's $60.2 billion executive budget proposal. It would have produced $1.9 billion in new and annual road funding revenue while freeing up another $600 million to boost spending on schools and other priorities.
Whitmer appears to have “caved” on linking road funding to the budget, which means Democrats may win few — if any — legislative priorities during her first year in office, said Matt Grossman, Director of the Institute for Public Policy and Social Research at Michigan State University.
The administration “either gave away their leverage or never actually had the leverage they thought they had to get Republicans to make concessions in terms of increasing revenue or making funds available for Democratic priorities,” he said, acknowledging that deals of the budget are still being worked out.
The no-fault auto insurance reform law Whitmer signed in late May remains the most significant bipartisan agreement so far during the state’s newly divided government.
That “could be viewed as a win for Whitmer, but it can’t be characterized as a win for Democrats or liberal policies,” Grossman said of the insurance reform law. “It was more favored by Republicans.”
Whitmer likely made a “calculated” decision to delay road funding talks but likely lost some leverage in the process, said TJ Bucholz, a Democratic strategist for Vanguard Public Affairs in Lansing.
“I understand that you’ve got to balance the budget any way you can, but I’m a little worried that this sort of compromise in this fashion negatively impacts the ability to get a substantive deal done on roads,” he said.