Lawmakers are starting a process of exploring the feasibility of having insurance companies effectively injecting some cash — which would likely be used for infrastructure improvements — into the state’s coffers. Similar financial investment tools are used in other states, and the bipartisan group of state Senators looking into the investment vehicle that could generate up to $900 million for road, highway, and bridge upgrades is on the right path by putting their toes into the water of the issue rather than diving in head-first.
State Sens. Mike Kowall (R-Commerce, Highland, Milford, Walled Lake, Wixom, Wolverine Lake, White Lake, Orchard Lake, West Bloomfield); Steve Bieda (D-Warren), minority vice-chairman of the state Senate Finance Committee; and Jack Brandenburg (R-Harrison Township), chairman of the Senate Finance Committee have put forward a three-bill legislative package that would allow certain insurance companies to prepay their premium taxes early to the tune of up to $900 million — money which would essentially be repaid to the companies through a 10 percent tax break in later years.
Kowall and Bieda both said the next step in the process is to ask Gov. Rick Snyder’s administration to weigh in on the proposal, which is laid out in Senate Bills (SBs) 985 through 987, all of which have been referred to Brandenburg’s Senate Finance Committee, where they await hearings and testimony.
Bieda said he expects committee work to begin on the proposal at some point after the Easter holiday, and Kowall stressed that the legislation would not result in a tax hike on Michigan’s citizens.
It’s laudable that lawmakers are approaching the proposal with a measure of caution rather than ramming the issue through the Republican-controlled state Legislature since such a financial investment vehicle would be new to the state. The complexities of the issue at hand deserve candid discussion and deliberation, including input from all the stakeholders involved, rather than a policy debate founded on platitudes. Infrastructure funding is a serious issue for serious people.
Members of both political parties know that Michigan’s road and highway network is in serious decline, with some reporting a funding deficiency statewide at $1.2 billion, and a variety of funding proposals have been floated in the past with little or no success. While more details are needed on the exact repercussions — both positive and negative — of the three-bill proposal introduced to the state Legislature last month, getting the ball rolling on a thoughtful and honest dialogue about its merits and drawbacks is a step in the right direction.