Published: May 08, 2008 09:56 am         

County wants to borrow cash to fix roads

TRAVERSE CITY -- Grand Traverse County may borrow up to $4 million to address crumbling county roads.

Roads are funded through gas taxes, but the county board is willing to use property tax revenues to prop up the financially struggling county road commission. The board proposes to borrow the money and split repayment costs with the road commission.

A final proposal that outlines what roads to fix and how much to borrow will be presented to the county board on May 20.

"The biggest public safety issue in our community is the condition of our roads," said county board Chairman Addison Wheelock Jr. "The tricky issue is picking the roads because so many of them need work."

Road commission Manager Mary Gillis said she will create a list of the most heavily traveled roads that need repairs.

The $4 million loan plan originated Tuesday when county board members discussed using $1 million for road repairs from a budget surplus fund. Talks then moved to borrowing $4 million, if the road commission can afford a repayment plan.

"We're never going to borrow money any cheaper than we are now," said Harold Kelly, road commission finance director. "The way our costs are going up you might be saving money in the long run."

It costs the road commission about $175,000 to repave one mile of road, but $500,000 if the road has to be completely reconstructed.

Fuel costs have jumped 300 percent in the last 10 years. Trucks cost 74 percent more and the cost to fill potholes has more than doubled.

Meanwhile, revenue is falling.

Roads are funded through state and federal gas taxes of 37 cents per gallon.

Higher gas prices and more fuel-efficient cars lead to fewer gallons of gas sold and less tax revenue, Gillis said.

"The fuel tax is a true user fee and the most equitable way to pay for roads," Gillis said. "But funding is not keeping pace with inflation."

The road commission maintains all public roads in the county except for state highways and Traverse City streets. The road commission estimates it will take $129 million to bring all paved county roads up to a good condition.

Streets in Traverse City are not included in the proposal. City taxpayers would be on the hook for about 16 percent of the property taxes the county board would use to pay back its share of the loan.

"I don't see the city being part of this," said Commissioner Herb Lemcool of Garfield Township. "It's going to be a county road issue."

Lemcool proposed the road commission spend $2 million this summer on road repair and another $2 million in 2009.

In 2010 the county board will ask voters to approve a 0.5 mill property tax levy for roads that would continue to raise about $2 million a year, he said.

Lemcool dismissed proposals to ask state and federal lawmakers to increase funding to county road commissions, raise gas taxes, or allow passage of a local hotel tax.

"We can go to the Legislature until the cows come home and they aren't going to help us," he said.