Moroun money pushing Proposal 5, tax hike supermajority

Oct 31, 2012

It’s obvious why the Ambassador Bridge-owning Moroun family is backing Proposal 6. That’s the ballot measure that would require of vote of the people to build international crossings. It would be another step toward blocking a competing bridge Canada has offered to fund.

But the billionaire and his family are also spending lots of money backing Proposal 5. That measure would require a two-thirds majority of the legislature or a vote of the people to change tax policy.

Yesterday we posted a story explaining the pros and cons of Proposal 5. But, it did not look at why the Morouns are spending money to support it. The truth is, no one seems certain. And the Moroun’s have not said.

But, as we researched the proposal and talked to those involved, one thing kept coming up. A gas tax.

Lana Theis heads up the Michigan Alliance for Prosperity, the organization officially responsible for putting Proposal 5 on the ballot.

“I think we already pay enough in road taxes.  And, I spoke to a legislator about it and asked him about it. And, I asked him, ‘Are all taxes taken for fuel applied to the roads right now?’ He said, ‘Absolutely not.’”

Actually, only the 19 cents per gallon state excise tax goes to roads and transportation. Theis wants all the taxes, including the sales tax use to support schools, local governments, and other state obligations, to go towards the roads.

Theis’ group is also running this radio ad which starts out with a phony news report.

Fake news announcer: “Well, Michigan drivers can get ready for more pain at the pump this holiday season, Governor Rick Snyder signing into law today his gas tax hike, giving Michigan the highest taxes on gasoline in the entire nation. Despite widespread public opposition the, uh, controversial measure passed the state House by the narrowest of margins: a single vote."

Second announcer: “It doesn’t have to this way. On November 6th vote ‘yes’ on Prop 5 to protect Michigan taxpayers from unnecessary tax hikes like Governor Snyder’s new tax on gasoline.”

It’s true that Governor Snyder has been talking about restructuring the gas tax. He says Michigan loses $1 billion a year in road value because the state does not have the money to maintain them properly.

The Governor says the state needs to change how gas is taxed to raise more money, because the roads are only going to get worse.

“It actually takes less money from our taxpayers. Because if you look at – if we let these roads deteriorate, how much money is that going to cost?”

The problem is road tax revenue is based on a per gallon charge. Because of the economy and more fuel efficient vehicles, drivers are using less fuel. So revenue from gas taxes are down. By restructuring the tax to a percentage on the wholesale price, more taxes are raised. It also would mean a slight increase at the pump, about nine cents a gallon at today’s prices.

Conservative bloggers are outraged. They are fighting mad about any chance of a gasoline tax hike of any kind. Tea Party followers want to stop it anyway they can and the two-thirds proposal would virtually make any tax increase impossible.

So, we’re back to the question of why is the Moroun family spending money to support Proposal 5?

There are three theories:

  • First, The Moroun family does not only own the Ambassador Bridge, but it owns a huge trucking empire. A fuel tax change could affect their profits. But, as one expert observed, they need good roads in Michigan and a fuel tax change would not affect them any more than any other trucking competitor.
  • The second theory, the Morouns put money into Proposal 5 because they needed help gathering signatures for Proposal 6. Conservatives and the Tea Party movement had people; the Morouns had money. It was a matter of ‘You scratch my back and I’ll scratch yours.’
  • And the final theory is getting out the conservative vote which would be more likely to vote for Proposal 6, the vote on the bridge. If conservatives are not excited about Mitt Romney and might not vote, the Morouns needed something that would get them to the polls. A vote to make it nearly impossible to raise taxes or change tax policy in the state would appeal to most conservatives and Tea Party affiliated voters.

All of this is speculation. But there’s little else to go on except for a billionaire family which has spent tens of millions of dollars in the last couple of years to put two constitutional amendment proposals on the ballot, run extensive ad campaigns, and supported the state’s most conservative legislators and Tea Party groups.