Bad Roads Bad News for Business

After the record-breaking winter weather, spring is a welcome sight. But while we leave the frosty temperatures and massive piles of snow behind, winter leaves an unwelcome reminder of its icy reign —roads full of potholes.

For many of us, this is an inconvenience. For businesses that rely on the roads to transport people and/or products, however, poor roads can be bad for their bottom line.

Business owners and community leaders alike support funding to fix the problem. Lawmakers recently approved a short term solution. Many see the need for a long term one, too.

Mercy Ambulance Services is a family-owned private full-service emergency transport company. Their licensed paramedics and EMTs also provide transportation on Amb-U-Cab to those who are wheelchair bound and need to be transported to in-state or out-of-state hospitals and other facilities. The company has a fleet of 11 ambulances and six cabs.

“Our biggest concern is with patient comfort,” said Dennis G. Palmer, President and CEO, who’s been with Mercy Ambulance for 30 years. “This has been a bad winter,” he said, worse than other ones in his memory.

He notes that although the main roads have been in fairly good condition, some are “spotty” and the drivers divert to different routes when possible.

As we thaw, and get into warmer weather, Palmer predicts the roads will be three times worse, and he hopes that legislators agree on a plan that gets and keeps the roads in good repair.

Last month, Michigan lawmakers approved a one-time supplemental spending bill to fund road maintenance such as pothole repair. The bill sets aside $215 million from a surplus collected from tax revenues.

Governor Snyder, however, has said that one time funding is not enough. He proposed a more permanent solution at his State of the State address in 2013. He asked to raise fuel taxes and registration fees to cover an additional $1.2 billion per year on roads and bridges. This year, the Michigan Department of Transportation estimates that that the amount has jumped to $1.3 billion because roads keep getting worse, especially after this harsh winter.

“The longer we wait, the worse the roads get and the more it costs to repair them,” said Jeff Cranson, Director of Communications, Michigan Department of Transportation. “If we got $1.3 billion, we could make huge strides in fixing our infrastructure.”

MDOT address this issue in a “Transportation Reality Check” information sheet they created in early March and posted on their website:

“For many years MDOT, county road commissions, and city public works departments have done the best they could with dwindling construction and maintenance funds and the higher costs of materials, keeping roads driveable and bridges safe.

“Now more extensive work is inevitable. Roads and bridges are falling apart at a rapidly increasing rate, and the cost to repair them keeps rising.”

East Lansing Mayor Nathan Triplett can attest to the deterioration of local roads and the need for additional funding.

“We have been struggling to find the resources to fix the roads in East Lansing,” he said. While he agrees with the legislation action for a “one-time infusion of resources,” Triplett, who also serves on the Board of Trustees of the Michigan Municipal League, said that we need a more permanent and comprehensive fix.
“We cannot afford to do nothing. The longer we wait, the worse the roads will get and the fewer resources we’ll have,” he said. “To fail to do so is hurting business, our job providers in the community.”

Michael W. Rogers, Vice President Communications for the Small Business Association of Michigan (SBAM) agrees that fixing the roads is good for business.

“Michigan has had many bright signs of a successful economic recovery over the last few years and a well-maintained infrastructure is a key component to continuing that recovery,” he said. “We are at a point in Michigan where our economic engine is revving up and we are able to discuss how much we can spend on our infrastructure, not just how much to cut from it as in years past.”

Rich Studley, President & CEO of the Michigan Chamber of Commerce said that the quality of the roads is among the worst in the nation, yet Michigan spends among the least to fix them. He agrees that Michigan needs to budget more for regular maintenance and repair for the good of the economy.

The road conditions have an impact on the three primary business sectors in the state — manufacturing, agriculture and travel and tourism. “We don’t want businesses going out of business, closing their offices and relocating to other states,” he said.

The Michigan Chamber supports increasing state and local funding by at least $1.6 billion per year raised primarily by user fees — such as changing the gas tax to a percentage of the wholesale price of fuel — and raising vehicle registration fees. He hopes businesses and the state legislature can work together to solve the issue once and for all.
Now that Michigan legislators have passed the most recent bill on supplemental funding, it appears that more legislative work will be done to find a more permanent solution.

“In the short term, the Michigan Legislature (resolved) how much to spend on the roads for basic road repairs and weather-related incidents,” Rogers said. “In the long term, however, the issue is still complex. SBAM hopes that both the governor and the Legislature will be efficient in this process. Prior to any increase in taxes or fees, strict measures for spending accountability must be in place to ensure that these tax dollars are spent competitively and efficiently.”

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