A robust system for pricing and revenue generation is fundamental to sound asset management practices. Implementing effective rate structures guarantees sufficient cash flow to finance crucial investments and ongoing maintenance of our infrastructure networks. While one-time infusions of infrastructure funding can temporarily alleviate current deficiencies, they do not address the underlying systemic causes of their existence. Predictable cash flow from a well-designed system allows for consistent budgeting and planning, avoiding the boom-and-bust cycles fueled by one-time injections. This enables proactive maintenance and prevents costly breakdowns in the future. This is the path to sustainability, and helping others down that path is a short-term priority of the MIC.
MIC Will Establish a Funding and Finance Committee to Oversee Our Advocacy Efforts in This Space. The Committee Will Collaborate With Academics, Associations, and the Private Sector to Develop Consensus Driven Policy Recommendations for the Legislature.
The way we currently pay for fixing and maintaining Michigan’s roads, bridges, water systems, and other infrastructure is outdated and won’t be enough eventually. This is because people are using less gas for cars and heating, using less water overall, and there are changes in our population. These factors mean the old ways of collecting money (like gas taxes and water bills) won’t bring in enough to keep everything in good shape. If we don’t find a new way to pay for infrastructure, things will only get worse, which will make life harder for everyone in Michigan. To fix this, we need to be open and honest about how much things cost (transparent rate reforms) and come up with a long-term asset management plan for funding our infrastructure so it can be properly maintained for years to come.
Partnering With Academic Institutions and Private Consultants, The MIC Will Look To Provide Low- or No-Cost Ratemaking Training for Public Finance Professionals.
Building sustainable and equitable water rates requires a dedicated team of government experts with deep community understanding. This team should possess expertise in costbalancing, equity with a focus on low-income assistance programs, and conservation strategies achieved through innovative rate structures. Climate change and evolving customer behaviors necessitate timely adjustments to rate structures, making a dynamic approach crucial to safeguard long-term infrastructure investments. By fostering strong community engagement alongside in-house ratemaking expertise, we can ensure cost recovery, promote fairness for all water users, and cultivate trust with the public.
The Funding and Finance Committee Will Partner With Social Service Networks, Michigan Department of Health and Human Services, and The Michigan State Housing Development Authority to Promote and Advocate Policies That Ensure All Michiganders Continue to Have Access to Safe, Reliable, and Affordable Infrastructure Services.
While subsidizing utility bills offers temporary relief for low-income residents, it doesn’t address the root causes of high bills. The state needs to prioritize long-term solutions like efficiency upgrades, weatherization programs and plumbing repairs, alongside rate reform that reflects how different demographics utilize infrastructure. Upgrading our infrastructure is vital, but we must ensure a just transition that doesn’t disproportionately burden low-income communities. Reconciling affordability, equity, and significant investment needs is complex, but achievable. Rate reform and upgrade programs need to be implemented in parallel. Data-driven rate structures that reflect usage patterns can help. However, in many cases, this alone won’t be enough. Strong partnerships between social service networks, state assistance programs, and utility companies are crucial. These partnerships will bridge the gap between customer ability to pay and the cost of service. This ensures essential services remain accessible for vulnerable residents while preserving the financial health of service providers, ultimately leading to better asset management.
MIC Will Work With the Department of Treasury to Draft Guidance for Communities Interested in Developing Clean Energy Revenue Streams.
Traditionally, infrastructure projects have relied on established sources like user fees, property taxes, and government funding. While these remain important, exploring clean energy revenue streams offers a promising path towards affordability for Michigan citizens. Recent legislation opens doors for communities: expanding on-site renewable generation, offering tax breaks for clean energy installations, and enabling innovative business models for electric vehicle charging networks. By empowering communities to unlock these new revenue streams, we can not only diversify our infrastructure funding but also position Michigan as a leader in the clean energy transition, creating stronger communities for the future.
