By DEBRA HAIGHT
BCR Correspondent
ST. JOSEPH, MI – The Berrien County Road Department will likely see more money in coming years with the road funding changes mandated in the new state budget, but funding may come up short in the meantime this year.
That was the message last week from Road Department Director Mark Heyliger to County Commissioners last week. Commissioners heard his plea for help and approved a no interest loan of up to $2 million from the county’s delinquent tax revolving fund for this year.
The road department was instructed to begin repayment in April and pay the entire loan back by the end of the year.
“This cash flow issue is coming at the absolute wrong time,” County Administrator Brian Dissette said. “The resolution you’re approving today calls for a $2 million draw down from the delinquent tax fund for use by road department. The treasurer is here today and is supportive of the planned drawdown.”
County Treasurer Shelly Weich concurred, saying that her office was ready to help out the road department in this situation. “I understand the need is out there; it is alarming,” she said.
“Thankfully we do have this funding we can turn to. I am a little leery that this will happen again, but I understand that the state is working through the bugs of the new system. We’re willing to loan the money and hopefully get them back on their feet.”
“The situation should correct itself if the state delivers on what’s being promised,” Dissette noted. “Assuming the marijuana dollars arrive, the road department fund balance will grow substantially by well over $7 million. You shouldn’t receive a similar request in years to come.”
This was Dissette’s last official county board meeting as county administrator. He is leaving at the end of the month to take the deputy county administrator position in Ottawa County. He has been with the county since mid 2020.
Heyliger outlined how the new state budget changes how road departments are funded and how they will hopefully bring more money in to fund road repairs. He noted that prior to the new budget, the state’s road funding came primarily from the fuel tax and vehicle registration fees at 40% each, followed by income tax at 16% and marijuana revenue at 3%.
The new budget removes the $600 million transfer from the general fund to roads as well as removes the 6% sale tax on gasoline. The sales tax on gas is being replaced by a 20-cent per gallon tax. The new budget also adds more marijuana revenue and a bigger share of the corporate income tax to road funding.
Heyliger said that the corporate income tax plus the bigger share of marijuana tax revenue is expected to bring in between $1.1 and $1.5 billion. Of that amount, $100 million goes to local bridges, $40 million to rail crossing upgrades and $100 million for transportation infrastructure projects.
He said that leaves $1.08 billion left to be divided among municipalities in the state, the Michigan Department of Transportation, and the state’s 82 counties. In the county, the funding will continue to be divided between 33% going to local roads and 66% going to primary roads.
Heyliger and Ed Noyola of the Michigan Association of Counties reported that this year’s temporary road funding shortfall has been caused by the timing of when the new funding sources will kick in with the new formula.
They said that the state road funds lost $600 million off the bat last October when the redirected income tax funding was removed. The new gas tax collections began this month but the revenue won’t be seen until March. The corporate income tax collection is done quarterly instead of monthly and the increased marijuana tax revenue collection won’t begin until late this year.
“It will be February 2027 when the new funding mechanism is in full effect,” Heyliger said. “Then it will be March 2027 when the monthly payments from the state will include the full funding changes … Overall this is extremely good news for the road department, but it will take a while to get there.”
Also at last week’s meeting, the county board approved a bond issue for the Paw Paw Lake Wastewater Treatment Plant project in the Coloma and Watervliet area.
Community Development Director Dan Fette reported that the 4 municipalities in that area are asking to borrow $1.2 million through the county for the project. Borrowing money through the county allows them to get a lower interest rates on the bonds. He said the municipalities expect to pay off the bonds in 15 years.
The county has funded several projects in conjunction with local municipalities through State Act 185 over the last several decades. Ones done over the last 15 years include the $21 million Benton Township water distribution system in 2011 and Berrien Springs and Oronoko Township water and sewer projects totalling more than $8 million in 2011 and 2014.
The county board will hold a special workshop meeting this week on Jan. 29 to start strategic planning discussions. That meeting will start at 10 a.m. at the county conference room in the Berrien County Health Department.