The $1.9 trillion federal stimulus bill is spraying a firehose of money into state and local government coffers. It's now up to elected officials to spend it responsibly — and prioritize future financial stability over political expediency.
That means not throwing money at boondoggles or entertaining calls to cut every resident a check.
It means treating the windfall like the unexpected gift it is — a chance to address immediate needs that will benefit all, while potentially freeing up funds to pay down debts and liabilities.
The most immediate of needs? Infrastructure.
Governments at all levels in Michigan are poised to receive $10 billion from the stimulus: $5.6 billion for the state and $4.4 billion for municipalities.
Local governments in Michigan should direct this money to the damn roads — and overpasses, and bridges, and every other piece of crumbling concrete that's been driving business away from our state for too long.
Spring is the perfect time for prioritizing potholes. And using stimulus cash to invest in repairs now could save money in the long term, as infrastructure advocates have long pointed out.
The stimulus bonanza alone won't solve years of neglect. The cost of reconstructing a mile of highway in Michigan has nearly doubled in five years to $3.45 million, according to the state Senate Fiscal Agency. The annual price tag to fix the roads now stands at a whopping $3.4 billion, driven in part by rising costs of labor, machinery and materials.
Still, there's enough federal money flowing to make a dent. One Michigan city manager called it an "almost sickening amount" — not a criticism, but rather a reflection of the responsibility involved in deciding how to spend it. Wayne County, for example could get a $339 million windfall, more than half of its annual general fund budget. Oakland County, the state's wealthiest, stands to receive nearly $244 million.
While the state funds the bulk of highway repair in Michigan, county and local governments have plenty of projects worthy of funding, from neighborhood street resurfacing to municipal water and sewer upgrades to dam repairs.
There are some restrictions on the stimulus money. Cities and states cannot deposit the money in underfunded pension funds, and the state Legislature can't use it to make state-level tax cuts.
But the cash could be swapped for general fund revenue, freeing up that money to pay down debt — a win-win for both short- and long-term needs.
It's unclear exactly how the restrictions on the funding will play out, or whether there's a way to indirectly shore up ailing pension funds that are hobbling many municipal budgets in Michigan.
In the meantime, local government officials should be having these discussions now — in open and accessible ways. Spending decisions of this magnitude should involve an effort to include public input — a commodity that's been in short supply during the pandemic.
This is not an emergency. It's a chance to make thoughtful decisions about an enormous amount of money that stands to benefit Michigan far into the future. It's important to decide wisely.
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March 21, 2021 at 11:07AM
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Editorial: Don't lose sight of the damn roads - Crain's Detroit Business
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