News Story

Money For Roads Doesn’t Go Where It’s Needed The Most

Roads in the worst condition are not a priority

In a recent social media post, state Sen. Jim Ananich, D-Flint, indirectly pointed to one of the challenges to improving the condition of Michigan roads.

Ananich, who is the Michigan Senate’s minority leader, said in a March 20 Twitter post: “MI Republicans: tossing a few pennies in a pothole and making a wish won’t fix our roads. I tried it just to see. Now let’s work together to find a real solution.”

Ananich also posted a short video in which he throws a handful of pennies into a pothole.

Michigan roads are funded through Public Act 51 of 1951 (PA 51), which governs how money gets allocated between state, county and local road agencies. Enacted in 1951, the law represented a compromise between rural and urban lawmakers. The Citizens Research Council of Michigan calls it the “third rail” of highway funding.

“The antiquated and inefficient formula used for sharing road funds with state and local road agencies guarantees that much of this funding will not go to those roads experiencing the most traffic or those in the worst condition,” the council stated in a report it released last month.

The law has not been changed in 67 years, mainly because in a big state there has never been a consensus on how to strike a balance between connecting far-flung communities and having smooth roads within them.

Under existing law, 39 percent of the money available for Michigan roads each year goes to the state Department of Transportation, 39 percent goes to county road commissions and 22 percent goes to cities and villages.

The formula also applies to $175 million in general state tax dollars that legislators have earmarked to fix roads this year, on top of gas tax and vehicle registration tax revenue. Of that $175 million, $68 million will go to state roads, $68 million to county projects and $38 million to cities. The money not spent by the state is divided among 83 counties and 533 cities and villages.

The Citizens Research Council said the state's system of divvying up the money doesn’t take into consideration which roads need repairs the most.

“Given the current PA 51 funding distribution system, it is nearly impossible to address the funding needs of heavily traveled roads or roads in greater need of repair without significantly increasing the allocation of revenues to those roads with less traffic or that have relatively lesser needs,” Craig Thiel, the council’s research director, said in an email. “Under this system, an increase in funding, regardless if it is one-time or ongoing in nature, will result in the same percentage increase for each road agency. This is inefficient."

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.

News Story

Detroit People Mover Maintenance Worker Paid $174,602 In 2017

Transit system loses nearly $10 per rider

The highest-paid employee of the Detroit People Mover monorail train last year wasn’t the general manager. It was a maintenance employee who had a base salary of $57,220 but ended up collecting $174,602 in total.

The employee had the job title of “electronic technician II.” The general manager of Detroit People Mover earned $119,565.

The figures came in response to a Freedom of Information Act request filed with the city agency that operates the People Mover, but the information sent did not include names. The agency is named The Detroit Transportation Corporation, but describes itself as a unit of the city of Detroit.

Three of the monorail’s four maintenance shift supervisors also collected six-figure pay while having base annual salaries of $61,131. One individual collected $105,456, another was paid $135,395 and the third made $161,368.

Four people with the job title of “mechanical technician I” also were paid substantially more than their base salary of $46,404. One made $111,182, another made $105,109 and the last two were paid $94,322 and $95,154 respectively.

Two “system control operators” had base salaries of $53,144 but finished 2017 with six-figure salaries. One collected $102,729 while the other was paid $100,962.

Altogether, there were 11 People Mover employees who were paid more than $100,000 by the city in 2017.

People Mover spokeswoman Ericka Alexander said the 2017 earnings included overtime and leave-time payouts. Alexander also said the Detroit Transportation Company hasn’t overspent its budget. It did spend 16 times more than it collected as revenue from user fares, though.

“The majority of individuals earning overtime are responsible for all facets of the operations and maintenance of the Detroit People Mover (DPM),” Alexander said in an email. “There are 12 vacancies in these divisions that DTC is seeking candidates to fill. We have few employees who earn annual salaries of six figures.”

The 2.9-mile downtown Detroit monorail loop lost an average of $9.89 on every trip it provided in 2016. The cost per trip was $10.51 and the average fare was 62 cents, according to a website that tracks transportation data. According the city of Detroit's 2017 consolidated annual financial statement, the People Mover cost $25.4 million to operate in 2017. The system is sustained by grants from the city, state and federal governments.

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.