Calculated moves - Part 3
Legislators mull strategies while rising costs and deteriorating infrastructure keep road budgets in a state of perpetual check

By Keith Goble
state legislative editor


Like chess masters engaged in a world- class match, state lawmakers are working within tight time constraints as they maneuver to pay for projects demanded by the driving public.

Here is a sampling of the moves some state officials are considering to avoid checkmate when it comes to their road budgets.

In Wisconsin, Gov. Jim Doyle signed a two-year, $57 billion state budget this fall.

Trucking industry officials in the state had reservations about a provision in the budget that calls for the first boost in truck fees in Wisconsin in about 10 years. Some in the industry said they believe it is a better option than other alternatives discussed during the budget negotiations.

Others said it is yet another blow to trucking operations that have already been weakened the past few years.

One of the numerous fee increases in the budget is a 30 percent increase in the registration fee for all trucks traveling Wisconsin roads. That one fee increase is projected to generate $57 million during the next two years.

Beginning Jan. 1, 2008, owners of the largest trucks will pay as much as $2,560 in annual registration fees, up from $1,969.50 – an increase of $590.50. The jump in cost will hit all trucking operations that use Wisconsin roads, regardless of where they are base plated. The fee will be based on the percentage of a truck’s mileage racked up in the state.

The final version of the budget left off a provision sought by the governor that called for taxing oil companies. Trucking industry officials said it would have increased fuel prices by as much as 10 cents per gallon because the oil companies would have passed the cost on to consumers.

Included in the budget bill is a provision long sought by transportation advocates. It prohibits the governor from diverting money from the state transportation fund for other uses. During the past four years, Doyle has rerouted $1.1 billion from transportation to education, then increased borrowing to pay for roads, the Milwaukee Journal Sentinel reported.

Another provision in the budget includes funding for the state’s Diesel Idle Reduction Grant Program. It also includes exemptions from emission inspections for vehicles of model years ranging from 1967 to 1995 and vehicles of model year 2007 or later that are powered by diesel.

The budget also prohibits building a weigh station in Rockland on Interstate 90. In addition, it includes up to $80 million in state borrowing to help start passenger rail service between Madison and Milwaukee. The project still needs federal approval.

Arizona Gov. Janet Napolitano is considering putting before voters a question about whether to impose new taxes to pay for roads. The governor is asking for insight on how best to close a gap in funding for transportation needs.

One particular option she is interested in pursuing is the possibility of building a rail line to link Tucson and Phoenix. Tolling existing roads also will be explored.

Napolitano said she wonders whether private groups would foot the bill for some of these needs. In addition, she wants to explore increasing the state’s fuel tax rates or the state sales tax, the Arizona Daily Star reported.

The governor plans to have a package ready to offer lawmakers during the regular session that begins in January. That would give state officials time to decide whether to put a tax proposal on the ballot as early as next fall.

Transportation officials in Georgia are talking up alternatives to a fuel tax increase to help pay for road and bridge work.

A joint House and Senate Transportation Funding Study Committee was told the state faces a $7.7 billion transportation funding shortfall. A U.S. Department of Transportation official told the legislators that one option to ease that burden, partnering with private groups, is worth looking into.

Senate Transportation Chairman Jeff Mullis, R-Chickamauga, was open to the idea. He said tolling and private ventures could eliminate the need to increase fuel taxes, the Chattanooga Times Free Press reported.

Mullis said a public-private partnership could be used to complete a rail running from Atlanta to Chattanooga. The line is sought to ease congestion on Interstate 75. Special lanes also could be added to I-75 that users would pay to drive on, Mullis said.

House Transportation Chairman Vance Smith, R-Pine Mountain, said three funding options are being considered. The options are to increase the state’s fuel tax, create regional local option sales taxes, or do nothing at all.

A leading state senator in Kentucky wants to give cities and counties the authority to issue bonds and create tolls for roads and bridges.

Senate President David Williams, R-Burkesville, has prefiled a bill for consideration during the 2008 session that would allow local governments to create public infrastructure authorities that could issue bonds for road and bridge work. The authorities could also privatize projects and place tolls on the projects. The authorities also would have control of state and federal highway money for road maintenance and construction projects.

All authorities would have to be set up by the governor and approved by lawmakers. The groups could decide toll rates and the location of collection booths. If approved, state law would need to be amended to authorize leasing of bridges or highways to private groups.

Maryland Gov. Martin O’Malley said passage of a major transportation funding bill is one of his main objectives for his state’s upcoming regular legislative session.

Discussion by the governor about a large plan for transportation funding doesn’t include any cost estimates or funding sources. He has previously floated the idea of increasing the state’s fuel tax or other levies to pay for road and bridge work, The Washington Post reported. He also talked about sending a larger portion of the state’s corporate income tax revenue to transportation.

Maryland transportation officials have said the state needs as much as $600 million in annual revenue to keep pace with needs during the next 20 years. The state now pays for its transportation work out of an account that is separate from the general fund. That fund faces a projected $1.5 billion budget deficit for next year, The Post reported.

To help bridge the gap, lawmakers are talking about increasing certain taxes, including sales and income taxes.

At a minimum, transportation officials in the state want to start increasing the fuel tax rates on a periodic basis to keep up with rising construction costs. The tax now brings in about $800 million annually.

Massachusetts Gov. Deval Patrick has unveiled a five-year, capital investment plan that would allot $5.72 billion in borrowed money for transportation projects.

More than $1.1 billion would be earmarked for transportation in fiscal year 2008. That would be a 25-percent increase compared with the current fiscal year. The new funding includes $613 million for statewide road and bridge repair projects – up $80 million from a year ago.

Although the investment plan includes a good chunk of change, Patrick said it only partly resolves an estimated transportation funding shortfall of up to $19 billion during the next 20 years.

“We have to think about some additional new revenues,” Patrick told the Boston Herald.

Some ideas discussed by state officials to fill the funding gap include higher fuel taxes, raising tolls, and implementing congestion pricing on the Massachusetts Turnpike.

The governor must convince lawmakers to approve bonds needed to pay for his plans. Bills to authorize those bonds are expected to be filed.

Critics of the plan have a cautionary message for the governor. They say Patrick needs to make sure his plans for new spending don’t outpace the state’s revenues or ability to borrow money.

Two state legislative panels recently got together to discuss possible solutions to Utah’s road-funding woes.

Interim committees on transportation and revenue heard presentations on options to help the state generate billions of dollars to build, repair and expand highways to help relieve traffic congestion.

The Utah Taxpayers Associations told lawmakers part of the solution to pump life into the state’s struggling transportation system could be to double the state’s 24 cent-per-gallon tax charged on gasoline and diesel. To offset the hike, they said the state’s personal income tax should be reduced accordingly, the Deseret News reported.

Another option would be to remove the sales tax exemption on fuel purchases. That would amount to an additional 4.75 percent tax tacked onto pump purchases.

One other option presented to lawmakers was to implement congestion pricing in high-traffic areas. These and other options to help pay for roadwork can be considered once the Legislature opens its 2008 session in January.

A legislative panel in Wyoming is looking into the possibility of imposing tolls on Interstate 80 truck traffic to help foot the bill for rising road repair costs.

The Joint Interim Committee on Transportation, Highways and Military Affairs asked state transportation officials to find out whether the federal government would permit the state to charge truckers to use I-80 in the state. The panel also wants some information on how much revenue would be generated.

If they get positive feedback, committee members have said they will pursue an in-depth study on tolling once the next regular session begins in February.

Another option drawing consideration by lawmakers is to increase the state’s fuel tax rate by 10 cents and charge higher fees for driver’s licenses.

The dime-per-gallon tax increase would be phased in during the next three years. It would generate about $70 million annually. The state would get $47 million from the tax increase while counties and cities would split the rest. LL


This is the third, and final, installment in Land Line’s series outlining how various state officials are seeking solutions to road and bridge funding problems.