Voters have Diminished Clout in Lame Duck

How much, if any, will gas taxes increase?

Lame duck sessions in the Michigan Legislature provide a no holds barred setting for Lansing lobbyists and special interests. Many lawmakers will be leaving the Legislature at the end of the year or the end of their next term; others who were just elected to new terms know they won’t have to face the voters again until two or four years from now.

The political environment is ripe for deal cutting. Some lawmakers who have measures they want to see enacted will gladly support unrelated legislation in order to get “their own bills” passed. Trying to predict what will happen during a lame duck session is risky. A line from the Kenny Rogers song “The Gambler,” describes the situation. “There’ll be time enough for countin’ when the dealing’s done.”

This year’s lame duck session started shortly after the election. It will resume again after the two-week Thanksgiving/deer hunting break and could run up to Christmas week. The headline-making big item on the agenda is road funding. Gov. Rick Snyder has made it clear that his No. 1 priority is securing a new revenue stream (pegged at between $1.2 billion and $1.5 billion) before year’s end.

To most Lansing special interest groups and lobbyists, the simplest means of getting the money would be hiking the state’s fuel tax and registration fees. Others, including some lawmakers, argue that all or much of the road funding dollars could — and should — come out of the $52 billion state budget. Still others question whether $1.2 billion is needed immediately and assert that the revenue stream could be secured in smaller bites over the course of the next few years.

When the collective will of Lansing’s special interests is weighed against that of ordinary voters, the special interests win out more than their share of the time. In a lame duck session, such as this year’s, the deck is stacked even more to their advantage than usual.

Last week the Senate passed House Bill 5477, which would double the state’s fuel tax. In past years the fact that the bill moved so quickly could have been interpreted as assurance of its eventual passage in the House. That dynamic, however, has changed since Gov. Snyder came to office. Legislation that is bound to be unpopular with voters now frequently moves from one chamber to the other only to ultimately wither on the vine.

Gov. Snyder and Senate leadership tried to pass the fuel tax hike in June. Attempting this only six months prior to an election seemed like a fool’s errand, and predictably it failed. But a key question now may be: How many lawmakers promised in June that they would vote for the tax hike after the election was over?

It seems likely that House Bill 5477 moved before the two-week break to allow lobbyists, special interests and the administration additional time to try to line up enough “yes” votes for the fuel tax hike to pass in the House. That task might not be easy. There are indications that the House is reluctant to pass the fuel tax increase; but indications are not guarantees.

If it was left up to House Republicans alone, the legislation would seem to be doomed, but there are 51 House Democrats who are part of the equation. Some Democrats probably see supporting the fuel tax hike as an opportunity to cut deals on legislation that is important to them.

One indication that there currently aren’t enough “yes” votes in the House to pass the fuel tax hike is the recent posturing of the Michigan Chamber of Commerce. The Chamber has supported the fuel tax hike, but it is now threatening to back a ballot proposal in 2016 that would require all of the taxes collected at the pump to go toward fixing and maintaining roads. At present a portion of taxes drivers pay for gas goes to the School Aid Fund and local governments. Changing that so all the money is dedicated to roads would likely force lawmakers to adjust the budget to make-up the lost education and local government funding by eliminating or trimming other programs.

No doubt, the Chamber’s threatened proposal would ruffle the feathers of Lansing special interests; but is the threat of this sort of proposal enough to make House members, especially Democrats, vote for the fuel tax hike? That could depend on how seriously the Democrats take the threat, how they think it would impact the 2016 election, and whether they see the road funding issue as a hot potato they are in no hurry to help remove from the laps of the Republicans.

Last spring House Republicans forwarded legislation that would produce roughly $500 million for road funding, while barely nicking drivers’ wallets. That approach could still be part of the mix. One possible outcome might be a hybrid solution that includes the House GOP plan coupled with a smaller fuel tax hike.

A theory often repeated in the lobbies of the Capitol is that: “Voters will be just as upset over a small tax hike as they would be over a larger one; therefore, just go ahead and pass a larger one.” We can bet lawmakers will be hearing that self-serving special interest wisdom uttered again and again as this lame duck session unfolds.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.