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Rep. Markkanen: U.P. forest industry, haulers to see level playing field with advancing plans
RELEASE|October 19, 2021

Legislation from state Rep. Greg Markkanen stepping up for Michigan’s vital foresting industry was advanced today by the House Transportation Committee.

House Bills 4976-78 allow the Michigan Department of Treasury to enter into reciprocal agreements with other states to exempt raw forest products transported into another state within 30 miles of the border from the International Fuel Tax Agreement (IFTA).

The plans address short hauls, removing burdensome requirements across state lines – notably via Wisconsin for U.P. transports.

“This legislative package will help small businesses that help move raw forest products in our region,” said Markkanen, of Hancock. “I am pleased to see these bills moving forward in the Legislature. This sector is a key economic driver for the U.P. A practical update was needed to address this issue. Other states such as Wisconsin, Iowa and Minnesota already do this, and these proposals will allow Michigan and the U.P. to be competitive.”

Motor fuel taxes are charged and collected across every state and Canadian province in North America, with IFTA serving as the mechanism to streamline and equitably hash out taxes for interstate carriers. The Department of Treasury is responsible for operating the IFTA program in Michigan.

While IFTA provides for an easy collection and implementation of each state’s fuel tax, there are some cases where reciprocal agreements to forego the process make more sense and simplify things for both haulers and state agencies.

Currently, only the Department of State has the power to enter into reciprocal agreements. Markkanen’s plan shifts this responsibility to the Department of Treasury as it is the department responsible for handling IFTA collections.

HBs 4976-78 now move to the full House for further consideration.

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