Michigan lawmakers have discovered something new to tax: the “points” on a person’s driving record. Under a bill sponsored by Sen. Jud Gilbert, R–Algonac, drivers who accumulate seven points within a two-year period will be assessed an annual $100 “driver responsibility fee,” plus another $50 for each additional point. Failure to pay the point tax will lead to license suspension.
In addition, a host of new taxes will be imposed for various infractions. The more serious the infraction, the larger the surcharge.
For example, drunk driving or fleeing a police officer will result in a $2,000 surtax. The tax will apply also to accidentally hitting a construction worker, police officer, or farmer.
The bill will not prevent these offenses, of course, but will turn them into profit centers.
And minor offenses aren’t overlooked. For example, a motorist unable to find his or her proof of insurance when requested by a police officer — even if they were, in fact, insured — would be assessed $300.
The new tax has been sold as a way to deter repeat violators. But what’s really happened is that lawmakers, looking for a rationale for raising taxes, simply found one that few lawmakers would have the guts to oppose. After all, who wants to risk being accused of not caring about driving safety?
The public safety fig leaf slipped a bit when, following passage in the Senate, the bill was referred not to the House Transportation Committee, as one might expect, but to the Committee on Appropriations, which decides where all the money will be spent.
It slipped a bit more when it came to light that the higher fines would be classified as administrative “higher responsibility fees” assessed by the Secretary of State, rather than as penalties imposed by courts. What this means is that lawmakers want to circumvent state law — which dedicates money from traffic infractions to libraries or local governments. Instead, they want this money to go to Lansing, where lawmakers can use it for their own purposes.
Besides the fact that the new law isn’t really about traffic safety, there are several problems with it. Part of the rationale for dedicating this money to libraries and local governments is to avoid creating a financial incentive for the state police to issue more tickets. The driving point tax law is devoid of such scruples. Although the new “fees” may not go directly to law enforcement, it is not hard to imagine police agencies reaching “an understanding” with legislators: Greater point-tax revenues flowing to Lansing likely will be rewarded with higher appropriations for law enforcement.
But not all the money may make it to Lansing. Motorists facing $300 fines are more likely to fight citations that would otherwise take them over the seven-point threshold. Given a potentially larger workload, to keep the courts moving (and court-cost revenue flowing), prosecutors are more likely to make deals. They could allow motorists to plead to no-point violations, dodging the point tax but paying a larger fine to the local court.
In short, the new law will create an incentive to write more tickets. Those who rack up more time on the road would be more vulnerable, as would drivers in already ticket-happy jurisdictions. There could also be a disparate impact on urban drivers, who may encounter police more frequently than average. It will also fall more heavily on those with lower incomes, who may accumulate more points simply because they lack the resources to fight a ticket in court.
Michigan cities appear to be ratcheting up ticket writing to make up for state revenue-sharing cuts. Some local governments have reportedly admitted that they depend on fine revenue to balance the books. The annual take is reportedly $1.5 million in Lansing and $4 million in Jackson County.
Traffic fines are ordinarily levied by judges, within guidelines set by law. These huge new penalties will increase some fines by 300 to 500 per cent, with no discretion available to judges. Attaching so much money to traffic tickets could exert a corrupting influence on traffic-safety efforts and on Michigan’s legal system.
Governments do not need more inducement to operate speed traps.
(Jack McHugh is a legislative policy analyst for the Mackinac Center for Public Policy, a research and educational institute headquartered in Midland, Mich., and editor of MichiganVotes.org, a service that catalogues legislation before the Michigan Legislature. More information is available at www.mackinac.org. Permission to reprint in whole or in part is hereby granted, provided the author and his affiliation are cited.)

By Dave Bailey
Oxford Village resident
In October 2011 some press coverage of this initiative (not in the Oxford Leader) caught my eye since it did not explain up front in the article just what the Personal Property Tax is, and how it is levied. Now on January 11 I see a piece in the Leader by James M. Hohman which concerns me for a different reason. I will comment on Hohman’s piece at the end of this piece.
First concern: I have asked some members of the general public to tell me about their perceptions of the Personal Property Tax. They all say it is levied on persons. When I ask them whether they themselves pay it, they shrug their shoulders. When I ask why they are not paying it, they guess that they don’t own anything really valuable. These misperceptions extend to some people who might be expected to know better, such as one person I spoke with, a college senior at a good Michigan private college who is interested in government. She didn’t know.
Given that the general public is so uninformed, should not the media explain the basics to them? Isn’t that what we expect the media to do, at a bare minimum, when the public is uninformed?
Let me repeat that this complaint is not directed at the Leader. The January 11 piece does tell what the Personal Property Tax is, namely, a tax not on persons or on the property of persons but on businesses. .
Second concern: Should the Personal Property Tax be repealed, every municipality in Michigan will lose revenue, unless some action is taken. In many cases, the revenue losses will be large. In good times, the losses might be manageable, but these are not good times. Tax bases have been declining for some years, and any prudent planner should anticipate further declines. An immediate economic turnaround would be a pleasant surprise, but we shouldn’t count on it.
What the prudent planner might not have anticipated, is the present initiative to eliminate the Personal Property Tax. Coming as it does after the lean years of depression, oh I’m sorry, I meant to say recession… ‘anyway, for the already hard-hit municipalities, the impact of PPT repeal would be like a defender piling on after the tackle. No fair!
Third concern: In response to a repeal, municipalities can do some things to minimize the hit. But available options will vary.
The first thing which might occur to a city council or other local legislative body, is to raise the millage enough to maintain the revenue stream at or close to pre-repeal levels. This strategy has two problems at least:
In almost all municipalities the greater part of the new revenues must come from the residential taxpayers, not from the previous payers of PPT. The residents should understand and sympathize with their council members, who are just responding, as best they can, to trouble coming from Lansing. But many will not understand.
Some municipalities are already maxed out on their millages. In those localities, the officials and/or the voters might feel resentment, since the state legislators had changed the rules on them. And since they are maxed out, they feel helpless as well as resentful. To be fair, shouldn’t the Lansing folks include in the PPT repeal bill an increase in the maximum millages which the various types of municipalities may levy? That way, those maxed-out municipalities which want to maintain their levels of service would have a legal way to do it.
Another option for councils to consider is of course to reduce services. To be fair, they should reduce or eliminate those services which were provided to the previous payers of PPT. If that could be done exactly, the residential taxpayers would not suffer at all. But in the real world, most services are provided to all, including to the innocent residents, who therefore would suffer. However, I am sure that something could be arranged along these lines.
Additional options doubtless exist. I shall not attempt to list them all.
Fourth concern: Municipalities with bonds outstanding would be pushed closer to default. Council members would need to decide whether to default on their bondholders, or default on their residents by eliminating service. Perhaps we would then find out who their true constituency really is. Do bondholders vote?
Fifth concern: The initiative, if passed and responded to by the councils, would transfer wealth from the class of homeowners to the class of those who presently pay PPT. For that reason, it may appear to some voters as an act of class warfare, an act of war in other words. I won’t go into my reasons for wanting to avoid that happening.
What can be done, and what should be done?
These are two different questions. For example, it could be argued that nothing should be done. Let the state legislature enact the PPT repeal. Then, after the inevitable consequences take place, vote the foolish legislators out of office, and replace them with wiser ones. We in Michigan would end up ahead of the game, since PPT is but one issue, and wiser legislators would favorably impact all the issues.
If you don’t want to wait through several election cycles, then you might alter this plan a little. Do nothing, and then recall the foolish legislators. This is faster, but it won’t work unless the governor is recalled first.
I do not support either of these strategies. It would be better to oppose, up front, the passage of any bill that would repeal the Personal Property Tax. That way the municipalities would avoid even a temporary loss of revenue, and they would be able to continue their services to individuals and corporations without interruption. Later, if opposition to the bill should fail, and PPT is actually repealed, then one of the other two strategies could be used.
Sixth concern: In the title of his Leader column, James M Hohman used the phrase ‘without replacement?. Surely he must realize that if the PPT were to be abolished, many municipalities would want to do just that, namely, replace their lost revenues. I take offence at Hohman’s ‘without replacement? suggestion. The Village of Oxford, in which I serve as an elected official, has a Charter, granted to us by the State of Michigan. The Charter gives the village the power to levy a millage. Any attempt by Hohman, or by state legislators, to interfere with the powers granted to the village in its Charter, is an attempt to interfere with the Charter itself. The Charter of the Village of Oxford is our equivalent of the Constitution of the United States of America. I support and defend both. Mister Hohman, leave our Charter alone!
Dave Bailey serves on the Oxford Village Council.

By Eric S. Wilson Vice Chairman, Road Commission for Oakland County

It won’t be long until temperatures drop precipitously and snow flakes start falling.
Unfortunately, drivers may notice a reduced number of snowplows on the road, as we at the Road Commission for Oakland County (RCOC) struggle to get by with reduced staff resulting from years of declining revenue.
These are challenging times in Michigan, and we ask the public for patience.
We’re all affected by Michigan’s shrinking economy, and the Road Commission is no different.
Despite our many steps to improve efficiency and save money, we have been unable to avoid staff reductions, which have a significant impact on winter road maintenance.
As recently as two years ago, we had 190 snowplows/salt truck drivers. Last year, the number dropped to approximately 165.
This year we have 150. That’s a 21 percent reduction in drivers.
In addition, several other critical factors are impacting the Road Commission this year.
For example, the cost of salt has increased by more than 30 percent compared to last year.
We’ll likely spend nearly $1 million more on salt this year.
Additionally, the Michigan Department of Transportation (MDOT), for the second year in a row, has mandated a slightly reduced level of winter maintenance on some of the roads we maintain on its behalf (RCOC serves as a contractor, maintaining most of the state highways in the county on behalf of MDOT).
This is due to MDOT’s ongoing budget challenges caused by the same declining road funds.
On county roads, the biggest difference motorists will notice is not during the initial blast of a winter storm, but in the hours and days that follow.
Here’s why: RCOC typically puts 106 snowplows/salt trucks on the road to battle a major storm.
According to our safety rules, the drivers can stay on the road for up to 16 hours before they must rest.
In the past, following this initial 16-hour effort, RCOC was able to replace the first 106 drivers with up to 84 drivers for a second shift to continue fighting the storm or clean up after the storm.
This year, no more than 44 drivers will be available for the second shift. That reduction in staff is a direct result of declining state road funding.
Why is this happening? The current fiscal year (2009/10) marks the fourth straight year in which our primary source of operating funds ? revenue from the state gas tax and vehicle-registration fees ? has declined. Those four years follow nearly 10 years of virtually flat revenues.
In fact, we’ll receive less funding in 2010 than we received in 2000 ? 10 years ago.
It may take RCOC snowplows/salt trucks longer to get into subdivisions following snow storms this year due to the reduced number of drivers.
Safety dictates that we focus our reduced resources on the roads that carry the most traffic at the highest speeds.
Only when those are sufficiently clear will we move to the slower, less-traveled subdivision streets.
We understand the need for school buses to be able to travel safely on the roads, and the need for our residents to be able to get to work or school during a snow storm.
However, until the state Legislature acts to increase road funding, we are all going to have to work together to make the best of things.
This is Michigan. Our winters have never been easy.
But, we in Michigan have always been able to overcome our adversities.
We will persevere. In the mean time, let’s all be a little more patient and enjoy the ‘winter wonderland? that is Michigan.

By Kenneth M. Braun
On March 24, for the second time in four months, the Michigan House voted to allow public school districts to hold elections for so-called ‘sinking fund? millages so as to increase the amount of money taken for operating expenses (see: ‘Sneak Attack,? January/February 2009 Michigan Capitol Confidential).
Currently, as a result of passage of Proposal A in 1994, school district operating expenses are funded on a per-pupil basis from the state’s School Aid Fund, which is itself funded through a combination of earmarks from the state sales tax, the personal income tax, an education property tax, business taxes and more.
According to the Michigan House Fiscal Agency, FY 2008 funding ranged from a minimum of $7,204 per pupil to a maximum of $12,387. Now at $13 billion per year, the SAF is the largest single expenditure of state government.
According to Michiganvotes.org, House Bill 4313 would ‘allow school districts to levy up to three mills for ten years to buy or fix school buses, and to buy computers? and that ‘the tax increase election would be either on May or November election days.?
Under Proposal A, school districts may hold bond elections to construct or make improvements to buildings. Sinking fund mills are currently an extension of this power, allowing districts to put away money to pay principle on those bond debts and to make capital improvements ? but not for operating expenses such as school buses and computers. One original justification for Proposal A, approved by 69 percent of Michigan voters, was to put an end to local millage elections for operational funding by creating the SAF’s large pool of foundation allowance money at the state level.
Proposal A’s constitutional protections against a return to these local millages are such that some legal experts believe that it would require a three-fourths supermajority vote in both chambers of the Legislature to reinstate the millage votes. If true, this would require 83 votes in the House of Representatives, but HB 4313 received only 74 favorable votes on March 24.
According to the HFA, fewer than half of Michigan’s school districts now have sinking funds and more than 80 percent of those districts levy less than 2 mills, rather than the 5 mill legal maximum. The Michigan Chamber of Commerce, a staunch opponent of HB 4313, notes that if the use of sinking funds is expanded to operational spending, then there will be a powerful incentive for many more districts to hold sinking fund elections seeking much higher property taxes.
Calculating the potential impact of the sinking fund expansion that the House approved in December 2008, the Michigan Chamber warned that it could lead to property tax hikes of $3.2 billion to $7.6 billion. While the version of HB 4313 passed by the House is restricted to spending on buses and computers, and was thus slightly more limited than the 2008 version, the business group’s opposition to expanded taxing power remained high.
‘Since 1994,? noted a Michigan Chamber statement before the HB 4313 vote, ‘school funding for operations is up 99% and school debt funding (like sinking funds) is up 269%! It seems logical that administrators should be able to run their districts without trying a sneak attack on taxpayer’s wallets.? Elsewhere, the Michigan Chamber noted that total inflation was up only 33 percent from the passage of Proposal A in 1994 until 2007.
Demonstrating the seriousness of the hostility to HB 4313, the MIRS Capitol Capsule newsletter noted that the ‘story in the House is that the Michigan Chamber of Commerce has basically told Republicans that anyone on the GOP side of the aisle who votes yes on HB 4313 can expect to have the Chamber oppose them in future primaries.? Ultimately, 11 Republicans decided to do just that. Other business groups opposing HB 4313 included the Detroit Regional Chamber of Commerce, the Grand Rapids Chamber of Commerce, the National Federation of Independent Businesses, the Michigan Manufacturers Association and the Michigan Association of Realtors.
Rep. Tonya Schuitmaker, R-Lawton, one of the Republicans to vote for the proposal, compared the spending of additional tax dollars by schools to spending by businesses. ‘I see it very analogous with companies that need capital improvements for technology,? she told MIRS.
Rep. John Walsh, R-Livonia, noted that he initially favored HB 4313, but then turned against it due to ‘overwhelming? opposition when he pitched the idea to his local businesses.
Another opponent, Rep. Phil Pavlov, R-St. Clair, made note of Michigan’s rapidly falling home prices and wondered how raising taxes on those homeowners would bring about better public education.
The bill is now before the Senate Finance Committee, chaired by Sen. Nancy Cassis, R- Novi.
Kenneth M. Braun is the senior managing editor of Michigan Capitol Confidential. He may be contacted at braun@mackinac.org. For additional information and an opportunity to comment on this legislation, please see www.mackinac.org/10424.

By K. Joseph Young

Vote Yes on Feb. 24 to further the goal of ‘A successful and happy life to live more abundantly for the entire community.?
When you have the opportunity to add to your home, enlarge it, remodel it to be more efficient in the use of space and more energy efficient (reducing your utility bills), make it safer–bringing it up to new building code and security standards, more attractive and not pay a penny additional in your monthly mortgage payment, by extending the mortgage by ten years, you would do it! Well the February 24 School bond vote gives you and the entire community the opportunity to do just that!
The current 7 mill tax rate limit will remain the same for the next fifteen (15) years regardless of the outcome of this bond proposal. The current debt is expected to reduce starting in the year 2024, which under this bond proposal would start reducing in the year 2034 with a final payment due in 2041.
Your YES vote will allow for the building improvements to be made now, when our economy is struggling, and take advantage of today’s economic opportunities without a change in your tax rate for the next fifteen years! Even if you vote no the tax rate will remain at the 7 mill limit for the next 15 years!
* The $70 million is being split in two bond issues ($43 million and $27 million) that keeps the interest cost down by borrowing the bonds when you are ready to use them. A two phase construction plan enables this split and savings opportunity.
* The interest rates on the bonds at this time in our economy are the lowest in years, resulting in a cost savings on borrowing the funds.
* The construction costs are down due to the low demand for building projects which has created a very competititve bidding process. This results in providing the best return on our investment.
* The phasing of the construction (along with the borrowing) will not only continue with competitive pricing but will also allow for a longer economic shot in the arm over the next four years (from 2009 to 2012) for Oxford’s local community–creating our own Oxford Community economic stimulus plan. The project calls for 80% of the jobs, contractors and material providers to be within twenty-five miles of Oxford! The school bond project provides for a community economic stimulus plan that will provide much needed work and business activity and it does NOT raise our millage rate!
* The return on your investment is most significant–it is a win/win/win for schools, business and residents.
* The Parks & Recreation Department programs will continue to work with the schools to maximize the use of the expanded facilities.
* With the increased population, business activity will increase for our downtown restaurants, shopping and services.
As you ponder the School Bond Proposal February 24 vote, ask yourself what is the down side of having improved, safer, expanded facilities that will enhance the quality of life for the entire Oxford community and vote YES.
We have much to be thankful for. We are blessed with not only a clean and safe community, one that has great growth potential but most of all with people that genuinely care and want the very best for Oxford. On February 24 you have the opportunity to make the community even better by voting YES.

K. Joseph Young is a resident of Oxford Township.