David Agema represents the 74th District in the Michigan House of Representatives, a district that includes the city of Grandville and parts of Ottawa County in the Grand Rapids Metropolitan Area. He is a Republican and currently the Chair of the House Appropriations Subcommittee on Transportation. Prior to becoming a legislator, Rep. Agema served in the U.S. Air Force and Air National Guard, and then became a pilot with American Airlines. He earned his MBA at Central Michigan University.
Q: As a legislator, what are some things that influence you in your policy decisions?
A: First of all, what is the role of government? I think the role of government is to make a level playing field for people to do as much or as little as they want to and then reap the rewards, or lack thereof. There has to be a safety net but not a hammock. I look at a bill and I say okay, what does this do for Michigan? Is it good for business or is it bad for business? If it's bad for business, I vote no. It's businesses that create jobs, not government. If government is creating a job it is what we call, in economics, a tax leech, it takes taxpayers money to create it. When an individual agency creates a job, it pays taxes, if you catch my drift. It's not leeching off of the taxpayers. So the solution is not more government jobs, the solution is more jobs from businesses. So my goal is to make Michigan a place where businesses can make a profit. They'll come, they'll hire people, and our economy will turn around. Our present business tax structure is one of the worst in the United States, it's terrible. It's based on gross receipts, not based on profits, so nobody wants to come here, businesses are moving out, and with them goes the people. I ran on three issues, I want to stop illegal immigration cause it's a great drain on our society. Last year we figure we spent nearly 929 million dollars in health care, education, welfare, jails, and human services on illegals just in Michigan. And it ran on onerous laws and taxes that's just bad laws and taxes and we need to get rid of them.
Q: How much does the Republican Party influence you in your decisions?
A: They don't influence my decisions. I'll vote for what I think is right, if they don't like it, too bad. I was voted for three years in a row the most conservative, one year I dropped to two, can't figure that out, but the first vote I ever took, I think I was the only ‘no' vote on the board. If I think it's the wrong way to go I vote no. I'm on my third term, so I'll do what I think is right.
Q: How do interest groups influence you, do you associate with any interest groups?
A: Well what a lobbyist does, or an interest group, is that they'll come in here and some of them are good, some of them are bad, but they'll come in here and tell you what their issue is, why they think it's good. Then I always ask them what their opponent is going to say. And then you listen to the other side. Some of these people just try to blow smoke. You'll know who they are quickly. So do I associate with an interest group? No. Their job is to come to me and try and convince me and if they can't too bad. So I'll listen to them, doesn't mean I agree with them.
Q: As chair of the House Appropriations Subcommittee on Transportation, what are some ways you think transportation can be improved in Michigan?
A: Well, Transportation is primarily done through Public Act 51, to build roads and bridges and take care of them. What's happening now is with the six percent sales tax you pay for a gallon of gas, none of that goes towards roads. Most people think that that six percent sales tax goes to roads, it doesn't. It goes to schools, 70%, revenue sharing 30% roughly. There's a very small percentage in there, a little sliver that goes to what's called the General Fund. I want to grab that little sliver, which is about 81 million dollars last year, and put that into roads and when I do that I can go to the federal government, and I can get back some of my money they took from Michigan. For every gallon of gas, plus the six percent you pay on a gallon of gas, there's 18.4 cents a gallon federal tax, and there's 19 cents a gallon state tax. So on a gallon of gas you're paying what? Sixty cents a gallon now on four dollars a gallon or whatever it is. So, I mean they complain about the oil producers making so much money, they make about four cents a gallon. The government's making sixty, go figure. So my goal is to try and grab some of that money, and put it back into roads, and then I can get a match, and that match is four to one. I spend a buck on a road, Michigan taxpayer money, I can get four dollars back, up to a limit, on money they took from the state on that 18.4 cents a gallon, that they took from every gallon that was sold.
Q: So what about Public Transportation's cut from-[the gas tax...]
A: Public transportation right now, I cut some of that out of my budget, because our public transportation system is good, we need it especially in the cities, people are going to use it in the future, but it's subsidized right now at 82 percent to 99 percent of operating costs, so that means that a person getting on the bus, for every dollar spent on operating costs, pays a penny of the cost or 18 cents of the cost. And there's no incentive for public transit people to be efficient. They're running buses that have zero to five people on them, every half hour. That's not good. So, the total budget on that is 239 million roughly for the state and 166 million of that goes to operating costs, I cut ‘em 20 million, forcing them to be efficient. Stop some of those buses on every half hour, maybe run them every hour cause nobody's riding them anyway. And then that money I took out of there, I rolled it back into the roads, so I can get that match again, so I take that 20 million out, if I get a match for that I can get 100 million for the roads. You need a road before you need a bus. You gotta have a road for that bus to run on. So the bus issue is a little bit of a concern for me, because there's no incentive for them to be efficient with that kind of subsidy rate. I'd love to run a business with a government that subsidize me at 99 cents on every dollar, all I'd have to make is a penny.
Q: You have a bill [House Bill 4023] that would cut state funding for transit systems that cannot earn at least 20% of their revenue- [from farebox]
A: No, it wouldn't cut it, it would just tell them, you must take 20% of your operating costs from the farebox. In other words the people riding the bus ought to pay at least 20% of the cost, I don't think that's unreasonable. And they're not, no one is in the state of Michigan. They do it in Chicago, they do it in Indy, some of them are taking thirty, forty, almost fifty percent. We're taking, not even close to that.
Q: So you're just looking for bus systems to increase their efficiency?
A: Efficiency and perhaps their fares.
Q: So you would want bus fares to increase in cities like Grand Rapids, Detroit, and Flint?
A: Well, the question I would ask is, on average if you figure on The Rapid, it costs 10 bucks for every time a person gets on a bus, a person riding the bus is paying a buck and a half. Who's paying the rest? Other taxpayers who don't ride the bus. The question is should the bus rider pay two dollars for that ride. That's what my bill would say. I think it's reasonable to assume that they should pay twenty percent of the cost, just for the operating cost, that doesn't even include the cost of purchasing the buses, that's another huge cost. That's capital outlaid by the buses. That's incomparable, so I'm just asking for the operational, in other words, paying the gas, the maintenance, and paying the guy who's driving. That's another thing, you wanna see some waste, fraud, and abuse, they found one bus driver who was making over 140 thousand dollars a year, now give me a break.
Q: Ok, now some say that this would force state control over local millages, local communities' ability to make their decision- [on public transportation subsidy]
A: No, that doesn't have anything to do at all; it's just saying you are going to take twenty percent from the farebox. Now what do you choose to do? You can choose to eliminate routes every half hour, maybe go to every hour and a few to bring your rate up to twenty percent, or you can raise your fares, you can do whatever you want to do, but a good manager should already be efficient and making the choices he has to make. The problem we're getting is that because there is no incentive for them to be efficient, or run it well, they don't. They just expect us, the cash cow, to keep giving them the money to do it. We don't have the money to do it anymore, so since we don't have the money, we have to start cutting in areas, it's as simple as that.
Q: Right, but if local communities approve a millage to fund-
That's fine we're not going to stop that at all.
Q: Ok... And are you for or against new investment in public transportation for the Detroit Woodward Avenue Light Rail Line or the Grand Rapids Silver Line Bus Rapid Transit Service?
A: Well I'm not familiar with the one in Detroit. Off subject a minute, I've only got about five more minutes here, there are some independent people that want to run hydrogen high speed rail and put it in between I-96's east and westbound lanes and run them on a rail, that would go fast, and run on hydrogen. I'm all for it. Somebody wants to come in here and build that kind of stuff, high-tech stuff, I'm all for giving them that right of way between the roads. Let them go ahead and do that. I think that's a great idea. Especially if I'm not taxing you to do it because they're willing to do it on their own dime. They know they'll be profitable because they'll go fast, people get where they want to go quickly. The Silver Line in Grand Rapids that's going to run up Division Street - here's the difference with that, you got to remember that I have an MBA, I have a bachelor in economics and an MBA in business, the typical business says that ok, I'm going to create a business, I'm going to find a need, and I'm going to fulfill it, and I can make a profit. Their attitude on that is, what is it a rail?
It's a bus, it's not on a rail, but yeah, it's a bus that acts sort of like a train-
Their attitude is that if we build it, people will come. Well guess what? If that were true in mass transit, people would have come and I wouldn't have to subsidize 82 to 99 percent. I doubt whether that will be functional and there was a study that was done that if it did increase people riding up Division Street, and people would want to live near that, it drives the very people out because they couldn't afford to live there and it drives property values up to the point where the people that are poor that need a ride can't ride anymore and they got to move out of the district. The study shows that that does that. So if you're trying to serve the poor to get them where they want to go, in the long haul they end up moving out because businesses move in and the higher income houses move in and so forth. Now whether that's going to happen, I don't know.
So if the question is am I against mass transit, no. But I am against any agency that runs inefficiently. The problem with government is almost everything they do is inefficient. Like every budget I'm on, whether it's higher ed., department of community health (DCH), transportation, I can find waste, fraud, and abuse in every single one of those because the government's so big the left hand doesn't know what the right hand is doing. So you can't ask me to spend more money that we don't have, and we're not efficient with what we do have. The transportation issue is all restricted, you can't go anywhere else with it, it has to go into transportation. There's only two ways I can solve transportation issues, I can raise your taxes on fuel which is absolutely the wrong thing to do in a recession, or I can try to find ways to obtain money that's already there, like that little percentage that's in the six percent gas tax or that little percentage that's in aviation fuel, try to put that in, so that's what I'm trying to do. So I'm trying to do everything I can to get roads built without raising your taxes. That's what I'm trying to do.
Q: Ok so the main way you want bus systems to be more efficient is to run less buses on off peak hours?
A: Absolutely, no question, and I got to go, but I mean I had my father in law, he's 87 years old in Grandville, and he counted for twelve hours. Every half hour a bus had between zero and a maximum five people. You tell me that's efficient. It's just not. Now if I was running that for profit, I'd have to say, "You know what, now we're going to run that bus maybe 7:30 in the morning to 9:30 every half hour, and then maybe every hour and a half, try to get that load factor up on the bus." And I asked them what the load factor was, and The Rapid is the best in the state, in Grand Rapids, and they said well they had 28 people per hour, and let's think about that. How many stops does a bus make in an hour, how far does a bus go in an hour? How many people are really on that bus at any one time? Let's multiply 28 by a buck and a half what is that? Forty, fifty bucks an hour? It doesn't even cover, again, it covers the gas, much less the drivers pay, the wear and tear, so my attitude is, charge a little more, if you're getting a service, pay for it. I'm saying take more for your farebox or take down your frequency and become efficient. I went over to the state my first year, I asked the same questions and I couldn't believe. The further east you go, the worse it gets, as far as subsidies. I think that CATA here I think, is subsidized at 85 percent in Lansing, and some in Detroit, I think it was 99, the People Mover in Detroit, and it may have changed a little now, maybe 95 percent.
Q: Right but these agencies also provide free or low-cost service to people with disabilities, elderly-
A: I have no problem with that, I say go ahead and do it, but then still you can cover your cost from the people riding the bus. That's my point. The People Mover charges people fifty cents, they're subsidized at 95 cents to the dollar. I said, "why don't you charge a buck?", and he looked at me and by the way I looked at his own data that said that people who ride it make between 45 and 65 thousand dollars a year, and I said, "Why don't you charge a buck?" -"Well we might lose ridership." I looked at him and said, "At 95 percent subsidy, shut it down, because there's nobody riding it for fifty cents." It's just draining our coffers with money we can't afford. I flew in the airlines for years, I was a fighter pilot as well, but in the airlines, we had to keep the airplanes about 82 percent full or we lost money, and the buses, if they have three people on it, they're not making a profit and they don't care. So it's an issue for me, I just think it has to be efficient and they're not. They have to be more than they are. If other cities can do it for thirty, forty percent of their farebox, why can't Michigan? Why do I have to subsidize it? The other guy, just down the street who lost his job, can't afford to pay the taxes on his house, why does he have to pay for that?