Dillon Warns Aviation Fuel Sales Tax Exemption Will Harm Schools

Proposal would cause School Aid Fund shortfall to school districts
Tuesday, May 7, 2013

LANSING — State Representative Brandon Dillon (D-Grand Rapids) warned that a proposal to exempt aviation fuel from the state sales tax would blow a hole in the School Aid Fund budget and further hurt public school districts already struggling after seeing funding decrease by about $2 billion over the past two years.

“I support growing Michigan’s transportation industry, but we can’t do that at the expense of our kids, who represent our state’s future,” Dillon said. “To give big corporations such as major airlines a tax break when our schools are running on empty is irresponsible. It tells our kids that we care more about airlines than we do about them.”

The bills that would change the way aviation fuel is taxed are House Bills 4571 and 4572. HB 4571 would increase the aviation fuel tax on the basis of its wholesale price. HB 4572 would then exempt aviation fuel from the state’s 6 percent sales tax. Republicans who support the bill say that the School Aid Fund would take a $55 million hit if the bill is passed. The two bills were reported out of the House Transportation Committee today without any solution to ‘fix’ the school funding shortfall Republicans created with these bills. A third bill, HB 4677, which could have replaced the School Aid Funds, wasn’t voted on by the committee and isn’t connected to the other two bills.

Groups opposing the aviation fuel sales tax exemption include the Michigan Education Association, Michigan Association of School Administrators, Michigan Association of Intermediate School Administrators, Michigan Association of School Boards, Michigan Association of Elementary and Middle School Teachers and the Kent Intermediate School District.

“Our schools simply can’t absorb another funding cut,” Dillon said. “It’s wrong to punish kids who are already crammed like travelers in coach class in overcrowded classrooms that don’t have enough textbooks to go around while giving major corporations a tax break at the fuel pump.”