Dan Gilmartin is executive director and CEO of the Michigan Municipal League
For far too long, Internet-based companies have reaped the economic benefits of doing business in our state without making the investments in local services that brick-and-mortar businesses have made.
That’s why it’s such good news that a recent U.S. Supreme Court decision has finally leveled the playing field for Michigan’s business community by allowing Michigan to enforce existing sales tax laws regarding online transactions.
This ruling can help communities by bringing much-needed revenue to cover police and fire protection, parks, senior centers and other services.
Sales tax revenue represents the second-largest source of revenue for Michigan’s communities. Unfortunately, the state has not lived up to its promise to provide steady revenue streams through revenue sharing, with the net result that the continued deferment from local programs and services to the state’s budget now tops $8.6 billion.
Fortunately, we can start to reverse that trend with the $200 million in sales tax revenue from online sales the Michigan Department of Treasury expects to collect in the coming fiscal year. It’s vital that this revenue go to communities rather than being specifically earmarked by Lansing.
It’s also abundantly clear that the state needs to take this opportunity to begin making important strategic investments in our communities. For too long, we’ve neglected and deferred investment in critical services such as police and fire protection, parks and other local services on which residents rely.
The state of Michigan ranks dead last in the nation when it comes to supporting our communities. This disinvestment in our communities has resulted in our local officials limping along trying to do more with less.
It’s now to the point that many communities struggle to provide basic services such as adequate police, EMS and fire protection, senior programs, trash removal, and snow plowing — all because the state doesn’t properly invest in our communities.
This is hurting our ability to attract and retain talent because we can’t create the kinds of places people want to live and where businesses want to locate.
A recent EPIC-MRA poll showed overwhelmingly that residents want their tax dollars spent locally. The poll showed 86 percent of residents prefer their taxes be used to provide local services, with only 9 percent saying their taxes should go to Lansing to fund state departments and agencies.
While we understand Gov. Rick Snyder’s desire to use this additional sales tax money to fix the roads, the public’s demand that local services need funding can’t be ignored. Our communities ― and our state ― can’t thrive if they don’t offer the types of services that make for attractive, livable communities. This revenue represents a real opportunity for lawmakers to send a message that they understand that, without strong communities, nothing else ― including roads ― really matters.