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Lawmakers eyeballing ‘restricted funds’ as next option to pay for roads

May 11, 2015

Last week’s defeat of Proposal One means the billion dollar question of how to pay for Michigan’s roads remains unanswered.

Lawmakers were quick to say that they’re going to work throughout the summer to come up with a new plan. But, if they haven’t been able to find a solution yet, what makes them think they’ll be able to now?

Beyond the General Fund

These somewhat desperate political times have some lawmakers eyeballing a pool of money that hasn’t, yet, been part of the road-funding conversation. A pool worth some $20 billion.

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“I want to look beyond the General Fund. We have roughly $20 billion of annual state spending that is restricted spending,” Republican House Speaker Kevin Cotter told reporters after Prop One’s shellacking.

But, of course, there’s a reason that the Legislature and the governor haven’t gone after that money yet. And that’s because of that operative word: Restricted.

Can’t touch that

Many of the billions of dollars in restricted funds are dedicated to specific purposes. By law.

These trust funds go to things like benefits for veterans and buying land for state parks or environmental cleanup. The School Aid Fund is also a dedicated fund.

Every deer hunter, for example, pays an extra $1.50 into the Game and Fish Fund for Deer Habitat. Do hunters want that money to go toward roads? There’s also the Children’s Trust Fund and the Animal Welfare Fund. Should that money be diverted to pay for roads?

Restricted funds are restricted for a reason: the public actually likes the idea of money being collected and used for a specific purpose.

Some of these restricted funds also help the state get matching federal funds from D.C. It’s hard to believe that any elected official would want to be part of plan that would mean their constituents get a smaller payback from Washington on their federal taxes.

Not so fast

Although for some lawmakers the restricted funds seem like a viable option, others aren’t so taken with the idea. Republican Senate Majority Leader Arlan Meekhoff, among others, says he doesn’t see a big payoff from rooting around in restricted funds.

That doesn’t mean the debate over restricted funds won’t happen (in fact, some liberals and libertarians in the Legislature may even want to have a little fun at kicking around the funds that go to the much-talked about as of late Michigan Economic Development Corporation) but that will just be a sideshow in a much bigger debate over road funding.

And, let’s be clear: restricted funds are restricted for a reason - because the public actually likes the idea of money being collected and used for a specific purpose and not simply left to the discretion of politicians.