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12 states successfully raised new transportation funding in 2015 — what can other states learn?

The second issue of Transportation for America’s “Capital Ideas” series, released today, takes a closer look at the states that passed new transportation funding and policy legislation in 2015, distilling it all into some notable trends, lessons learned, challenges, and recommendations for other states planning similar action in 2016.

After years of inactivity on the issue, transportation funding has increasingly become a priority in states both red and blue. 2015 was a high water mark for the number of states successfully raising new funding, boasting successful increases in 12 states, bringing the total to 23 since 2012.

Along with a big-picture overview of all the states that were successful this year, this short report takes a closer look at a state that passed one of the better overall bills (Utah), a state that suffered a defeat on the way to a final package that failed to fundamentally improve policy or solve the revenue question (Michigan), and a state that passed another round of policy reforms to build voter trust and accountability following an increase in new transportation funds in 2013 (Virginia).

Through the successes (and failures) of 2015, we pull together some practical lessons and challenges for the other states hoping to take up the issue in 2016 or 2017, like showing why instituting reforms to boost public confidence can increase the likelihood of success, why indexing fuel taxes to inflation still isn’t a long-term solution, and why states should still find ways to fund all of the diverse needs in their states — not just highways. (Something that not enough states managed to do this year.)

Many states have an uphill challenge on that last point: did you know that almost half (23) of U.S. states have constitutional restrictions on their fuel taxes that restrict their use to roads or highways only? Those are the kinds of nuggets you can expect in Capital Ideas II.

While 2016 may not be quite as active as 2015 was due to a busy election year ahead, this trend will not abate anytime soon.

Even though Congress did finally pass a five-year bill this year, states are unlikely to stand pat on transportation funding. Years of dwindling federal funding and lost revenues due to arcane, static, and declining gas taxes have left states struggling to balance their budgets, and unlike Congress did recently, states can’t sell future oil reserves, raid the Fed or rely on accounting gimmicks to cover their costs — they have to find real money.

Read the report in full online and stay tuned as we bring you more news about T4America’s work in states in 2016. While we made our name and earned our stripes working at the federal level since our inception more than six years ago, we’ve been doing more work at the state and local level, and we’re eager to tell you more about it in the months ahead.

Michigan ballot measure to raise transportation & education funds goes down by a large margin

A Michigan bill that would have raised new money and overhauled how the state pays for transportation was defeated by huge margin Tuesday with 80 percent of voters rejecting the complicated proposal.

The bill would have eliminated the state’s fuel sales tax and raised the tax on wholesale gasoline sales to 41.7 cents per gallon (or 14.9 percent of a gallon of fuel’s base value, whichever is higher). This maneuver would have ensured that the entirety of the wholesale gas tax would have gone to transportation, compared to the current gas sales which does not.

To compensate for the loss of gasoline sales tax revenues currently going to municipalities and schools, the bill increased the sales tax on everything else statewide from six to seven percent and allocated the additional revenues to schools, local municipalities, and a tax break for low-income families.

The proposal would have also increased vehicle registration fees, commercial truck registration fees and would have instated a fee on electric vehicles.

While certainly disappointing to the supporters in Michigan, it reinforces the same lesson we’ve shared here regularly: transportation-related ballot measures have the best chance of passage when they are simple, specific and transparent about the money that will be raised and exactly where and how it will be spent. Voters have proven over and over again that they’ll support transportation ballot measures — if they meet some of those basic qualifications. Michigan’s measure surely suffered from the complexity and from the combination of education and transportation funding together into one proposal.

Some of the states still in play in 2015

Though there have been no new statewide funding packages passed since our last update here, other states are trying to bring transparency to the process of selecting transportation projects. Texas’s HB 20 tasks the TxDOT with creating “a performance-based planning and programming process” that would evaluate which transportation projects receive state money. Similarly, Louisiana’s HB 742 would require the Louisiana Department of Transportation and Development to rank projects according to a series of measures that highlight which projects are most vital to the state.

Also in Louisiana, the House’s tax committee approved two funding bills. The first would raise the state’s sales tax by one cent, with the proceeds going towards 16 designated transportation projects. The second bill would increase the gas tax ten cents, from 20 cents per gallon to 30.

The Missouri Senate gave initial approval to a 1.5-cents-per-gallon gas tax increase (3.5 cents per gallon for diesel). The state’s gas tax has been 17.3 cents per gallon since 1992. The bill stills needs one more vote in the Senate before going to the House. There are only two weeks left in the state’s legislative session and it is unclear whether they will vote on the bill before then.

In Minnesota, where we recently documented the state’s prevalence of structurally deficient bridges, both the House and the Senate have passed transportation-funding bills, but the two differ greatly. The Senate proposal raises new funds via a gas tax increase and a Twin Cities regional sales tax increase. The House’s version mostly shifts dollars around or borrows funds for transportation. The issue has been pushed aside as legislators must also hash out a state budget before the May 18th deadline.

Governors step out in favor of raising transportation revenue

States across the country are facing huge deficits in their own transportation budgets — a problem compounded by the uncertainty over the support they’ve always received from the federal transportation fund, which is now just months away from insolvency. However, over the last month or so, at least nine governors have highlighted plans to raise new state transportation revenues in their State of the State addresses, marking the issue as a top priority.

NEWSLETTER - Governor State of the State on revenueWhile their speeches are notable for their willingness to take a stand on the issue, these governors (and many state legislators) are stepping out on the issue because states face growing needs and static or falling revenues from state as well as federal sources.

As of press time, six Republicans and three Democrats spanning from Washington to Connecticut have come out in support of raising transportation funding at the state level by various mechanisms in the hopes of providing stable and reliable revenue for years to come. And they’re counting on Congress to do their part and come through with reliable federal funding as well.

After looking over the transcripts of all nine speeches, two major themes stood out: the importance to a state’s economic growth and development of a well-run, well-funded transportation system, and the financial and public safety cost of poorly maintained infrastructure.

After campaigning on the issue, returning Connecticut Governor Dannel Malloy (D) introduced his plan for a 30-year overhaul of the state’s entire transportation system, including the creation of a “transportation lockbox” to ensure transportation revenues are spent on transportation projects. He has promised to propose specific revenue mechanisms in his February 18th budget address.

“We know that transportation and economic growth are bound together,” Governor Dayton said on January 7th. “States that make long term investments in their infrastructure can have vibrant economies for generations. States that don’t, will struggle. It’s that simple.

Transportation connects us – literally – community to community, state to state, nation to nation. It connects us economic opportunity, and it connects us to another.”

Idaho Governor Butch Otter (R) proposed raising transportation fees to help address the state’s ever increasing number of deficient bridges and poorly maintained highways, suggesting that spending some now will save more in the future. While calling for greater investments for transportation and infrastructure in his speech, he did not address any specific plans to do so, only saying to his fellow legislative colleagues, “I am not going to stand here and tell you how to swallow this elephant.”

“I fully understand the misgivings of some about higher transportation costs. But there is something to be said for the old adage about being ‘penny wise and pound foolish.’ In fact, every dollar we invest now in our roads and bridges will save motorists and taxpayers $6 to $14 later.”

In Iowa, with 35 percent of their annual transportation budget coming from the 19 cents per gallon gas tax, Republican Governor Terry Branstad is concerned about the state’s ability to adequately build and maintain the state’s infrastructure and transportation system with that source. The governor did say before his State of the State address that part of the solution could be allowing local governments to add their own gas tax for local projects and transportation needs. He expressed hope that lawmakers and stakeholders could come to a consensus on a specific solution.

“Over the past few years, rhetoric has trumped results when it comes to action on infrastructure funding for Iowa. A recently completed Battelle study demonstrates the need for us to take a hard look at adequate road funding. The study shows that without action funding available for road and bridge maintenance will fall short of what is needed to remain competitive and most importantly, safe.

Without action, Iowa’s roads and bridges face an uncertain future. Our farmers will find it more difficult to deliver their commodities to market. Business and industry will look elsewhere when considering where to invest and grow. As the study found, sound infrastructure remains a prerequisite for economic development. “

While Democratic Minnesota Mayor Mark Dayton has yet to give his State of the State address, his administration did release the details of his $11 billion transportation funding plan this week. It implements a 6.5 percent gross receipts tax on gasoline, raises the current 1.25 percent base on vehicle registration fees to 1.5 percent, and increases the sales tax by a half cent in the Twin Cities Metro area, specifically for improved transit, bicycle, and pedestrian infrastructure.

“Inadequate transportation clogs our lives with worse traffic congestion, longer commutes, more dangerous travel conditions. Those deficiencies restrict our future economic growth and detract from our quality of life,” said Governor Dayton. “If we continue to avoid these problems, they will only get worse. It’s time to begin to solve them.”

South Carolina Governor Nikki Haley (R) called for a 10-cent gas tax increase, as long as the legislation included cutting the state’s income tax by 30 percent and restructuring the state’s Department of Transportation.

“Deficient roads and highways are an economic issue. That’s why we supported $1 billion in new road funds last year, which was the biggest infrastructure investment in a generation. It’s why we proposed in our Executive Budget dedicating an additional $61 million in auto sales tax funds entirely to roads. But we know that’s not enough. We still have very substantial revenue needs that need to be addressed.”

Republican South Dakota Governor Dennis Daugaard outlined his transportation plan that would raise the vehicle excise tax from three to four percent, and increase the motor fuel tax by two cents this year and an additional two cents every year going forward. His plan would also implement a 10 percent increase in vehicle registration fees for local entities. The plan would allow the state to invest $50.5 million more for roads and bridges, with $39.8 million for the state highway fund, and an additional $10.7 million for local towns and cities.

“Our entire economy – our very wellbeing – depends on road infrastructure,” Governor Daugaard said during his State of the State Address. “And right now, our roads are underfunded.”

Addresses from the governors in Georgia, Michigan, and Washington focused on the need to raise revenue because current conditions represent public safety issues — or could soon without adequate investment.

The Republican governor from Georgia, Nathan Deal, has suggested that his state needs an estimated $1 billion to $1.5 billion more to maintain the state’s roads, highways, and bridges — and even millions more to expand. He offered the legislature three options to raise the funding needed to maintain the state’s infrastructure: a regional one percent sales tax designated for infrastructure projects; a plan that will reprioritize funding and focus on the most essential projects; or a “transportation plan that would address the ongoing needs of maintenance and repair, as well as freight corridor and other transportation improvements.”

“We are currently operating at a rate that requires 50 years to resurface every state road in Georgia. If your road is paved when you graduate high school, by the time it is paved again you will be eligible for Social Security.

If we continue to do nothing, we would continue to have to depend on the federal government, whose transportation funds are also dwindling. If we should choose not to maintain and improve our infrastructure, economic development would stall, companies would be unable to conduct their business efficiently, commuters would waste more time and gas sitting in traffic, and no one would be satisfied.”

Michigan Governor Rick Snyder (R) signed a plan to raise $1.3 billion more a year to mend deteriorating roads and other transportation infrastructure, contingent on Michigan voters increasing the state sales tax to seven percent via a May ballot measure. This bipartisan package of 11 laws would restructure and ultimately raise static per-gallon fuel taxes while exempting fuel from the state’s 6 percent sales tax.

“The key issue is public safety. If you look at it and you look at our bridges, one out of nine is structurally deficient. So, when you drive Michigan and you see plywood underneath the bridge, why is it there? It’s keeping crumbling concrete from falling on your vehicle, that’s unacceptable.

When you talk about our roads and you see those potholes, just think about the issues and concerns you’ve had this personally. When you swerve to miss a pothole, you are a distracted driver. You are putting yourself at risk and other drivers and other people. If you hit that pothole and you blow a tire you’re at risk of a major accident. That is unacceptable.”

Democratic Washington Governor Jay Inslee introduced a cap-and-trade program that would require the largest industrial polluters to pay for every ton of carbon they release, and then direct at least a portion of those funds into transportation. It could raise nearly $1 billion in its first year to pay for transportation projects. California is the only other state to attempt such a funding mechanism.

“Without action, there will be 52 percent cut in the maintenance budget, and 71 bridges will become structurally deficient or functionally obsolete. Without action, commute times will continue to rise, robbing us of time with our families. Without action, our ability to move goods efficiently will be diminished.

[This plan] keeps us safe by fixing our bridges, patching our roads, and cleaning out air and water. It also embraces efficiency, saves time and money, and drives results that the public can trust through real reform. Finally, it’s a plan that delivers a transportation system that truly works as a system. A system that transcends our old divides and rivalries. No more east versus west, urban versus rural or roads versus transit.”

Though some plans are certainly better than others, these nine governors are demonstrating true leadership by bucking the conventional wisdom and supporting new revenue to invest in transportation and infrastructure. More could follow in the weeks ahead as a few more State of the State addresses happen and legislative sessions get underway. Transportation for America is pleased to see these leaders take a stand on raising stable transportation funding, and we hope that Congress follows suit to support their efforts by rescuing the nation’s transportation fund from insolvency this spring.

As Michigan legislators race the clock on a transportation deal, other states plan initiatives

We tapped a nerve in November with the Capital Ideas conference in Denver. More than 30 states sent representatives – some of whom went right back to their states and got to work helping their communities make progress.

Folks in Michigan are working with Gov. Rick Snyder to adopt a long-term, stable funding source for infrastructure. As their session winds to a close this week, legislative leaders are working in a House-Senate conference committee to hammer out a compromise that could bring as much as $1 billion a year in additional funding to repair and improve transportation infrastructure.

Gov. Snyder, who has been pushing for money to fix roads and bridges since coming into office, has seen the lame duck session as an opportunity for the GOP-controlled legislature to adopt a plan to raise additional transportation revenue, according to The Detroit News.

“The money I’m talking about is to get us to fair-to-good roads,” Snyder said, after taking a tour of Detroit’s highways. “They’re not even going to be great roads, folks. … We were the state to put America on wheels. Now we’re also widely known as a state with some of the worst roads in the country, and that’s just unacceptable.”

Over the summer, House Republicans responded by passing a much more modest plan to help fund the road upkeep. The $450 million a year would have come mostly from the general fund rather than a gas tax increase, while converting the 19 cents-per-gallon tax to a 6 percent tax at the wholesale level.

But the governor and Senate leaders preferred a more robust package that did not require taking money from other areas of the state budget. It took until after the election, in November, for the Republican controlled Senate to respond by passing an even larger funding package. The plan would increase the gas tax to the equivalent of 44 cents over four years, based on the wholesale prices.

While Michigan legislators work on their compromise, we already are hearing of transportation initiatives moving in other states. This month James Corless, director of T4America, was invited to testify before the Senate Transportation Committee in Oregon. We also met with legislators, state and local officials, and business leaders in Louisiana to discuss transportation policy and funding options. Many others in our state network are developing plans for the upcoming 2015 legislative sessions.

To join with us in our state work, sign up for the state advocacy network.

From state to town, Michigan takes strong steps toward a better transportation future

One place illustrating the national positive voting trends for transportation is Michigan, where citizens voted to raise taxes for transportation investments in cities and counties across the state, at least one anti-transit elected official was ousted, a Republican governor led the charge for regional transit investment in the state’s biggest metro and when given a chance to bail in the name of “cost savings,” local voters doubled down on their existing transit system.

There were a lot of eyes on Michigan during Transportation Vote 2012, in part because of the sheer number of transportation measures being decided there: over 30 different ballot questions in 2012 alone, according to the Center for Transportation Excellence.

Though there were dozens of worthwhile transportation ballot measures passed this year, Eaton County, Kalamazoo County, Muskegon City, and Ogemaw County all either renewed or passed new substantial tax millages to support public transportation specifically.

That’s no fluke, as Tim Fischer of the Michigan Environmental Council told us. Fischer, the Deputy Policy Director for MEC and part of the Transportation for Michigan coalition echoed a familiar refrain about the success of transit related ballot measures.

“I think the real message is that voters will support transit almost every time when they know where their money is going and what it will be used for,” he said.

Along those lines, a handful of cities around the country were offered a choice to secede from existing transit systems and decide to send that money elsewhere — a phenomenon explained in more depth by Angie Schmitt at Streetsblog Capitol Hill a few weeks ago — including one vote in Walker County, Michigan, a city in the western suburbs of Grand Rapids. In a show of support for their existing system, voters in Walker rejected that attempt by a huge margin (73 percent opposed), “because residents see real value in their local transit systems even though they might not ever use them,” Fischer added.

“Road millages, by comparison, don’t always fare so well and have been rejected more often than passed in recent years. People perceive that they already pay for roads through the gas tax and are less inclined to pay for roads through millages.”

(That wasn’t the only good news in Grand Rapids, which also recently received $20 million in federal funds to build a BRT line.)

In a more recent development, just last week, the Michigan legislature passed landmark legislation finally creating a regional transit authority in Detroit, something that transit advocates and Detroit leaders have been trying to do for decades.

They were no doubt urged along by USDOT Secretary Ray LaHood, who told Michigan leaders they wouldn’t receive federal money for the Detroit Woodward light rail line without a regional authority to receive and manage the money.

“The RTA passage will trigger USDOT to release $25 million in promised federal funds which will add to about $80 million in private money,” Fischer said. “In addition, a component of that legislation is the development of about 100 miles of rapid bus transit (‘BRT light’).”

The coalition that helped the RTA legislation along to victory was a broad one.

MOSES (Metropolitan Organizing Strategy Enables Strength), which does faith-based organizing within over 40 congregations in southeast Michigan, was a key part of the successful coalition. MOSES did much of the legwork to push the bill through, holding scores of meetings with legislators to affirm to them the importance of investing in public transportation (pdf), and explaining how the lack of this regional authority was a significant roadblock to doing that.

Michael Tasse with MOSES said that their leaders and members had been having meetings with legislators for over two years on the regional transit bill.

“We pushed the governor to support it,” Tasse said. “We helped persuade legislators who were on the fence or who might not have initially supported it by helping them to understand the bill. A big part of what we spent a year doing is educating them on the bill and pushing them to read through it and understand it. We made scores of visits in district, and we went to Lansing more than ten times.”

MOSES is celebrating the passage of the bill as 2012 comes to a close. “This is important because it’s about transportation — not just rail lines to Chicago, but the bus lines that connect people across town and the factories across town and the suburbs,” he explained. “Connecting people to those jobs is how we’re going to build strong families and communities in Southeast Michigan. If people can’t get around, they’re stuck, and that creates a gap between the few and the many.”

But the wins go beyond just local or regional transit in Michigan. Passenger rail statewide has had a significant boost in the last year, certainly helped along by the leadership and straight-up boosterism of the Republican Governor Rick Snyder.


Michigan Governor Rick Snyder talks to the media at an event sponsored by the Michigan Municipal League.

Michigan has received about $500 million for the Chicago-Detroit/Pontiac passenger rail route, including funds to purchase about 130 miles of track from NS, adding to the 100 miles already owned by Amtrak. 234 miles of the 300 mile Chicago-Detroit route are now under public ownership. Trains are already running at speeds of 110 mph on some of this stretch, and they’ll run that fast for longer stretches once more track is upgraded next construction season.

Incidentally, this line from Detroit to Pontiac runs right through the town of Troy, where a mayor who refused a federal grant to build a new train station there was ousted by recall in November and removed from office.

All of these stories of Michigan communities and the state seizing control of their futures and declaring the importance of transportation at the ballot box are encouraging, but they still can’t go it alone — they need the feds to step up and support these kinds of communities leading the way.

“The rail projects wouldn’t exist without it [federal support], nor would the Grand Rapids BRT line,” Tim Fischer told us. “The locals must do their part, but federal money is necessary to turn the projects into reality.”

Michigan boosters like Fischer see the positive trend continuing.

“I am optimistic for Michigan’s future. Our passenger rail programs and transit systems have come a long way in just a few short years. Also, communities across the state have great interest in complete streets — over 80 have adopted complete streets policies or resolutions since we established our complete streets law in 2010.”

“Things are coming together at long last,” Fischer said.

T4 partners meet President Obama, talk about transportation and infrastructure

Three T4 America partners were invited to join us at the White House Monday to meet the President of the United States and talk about transportation funding, specifically the infrastructure portion of the President’s American Jobs Act. The President’s plan, which failed to make it to a final vote yesterday in the Senate, would have invested $60 billion into infrastructure.

White House staff contacted T4 America to invite a few of our local partners out there with boots on the ground working hard to get their local, state and congressional leaders to start making smart, solid investments in transportation to help boost the economy and get people back to work.

Brian Imus of Illinois PIRG, Scott Wolf of Grow Smart Rhode Island, and Arnold Weinfeld of the Michigan Municipal League (pictured, standing right) were invited guests of the President for his Monday working group meeting in the White House to talk about the urgent need for America to invest more dollars, wisely, in our aging transportation system.

Arnold Weinfeld got a chance to stand up at his front row table a few feet from the President and tell him the same thing that we highlighted on our blog last week, that fixing bridges and building transit and passenger rail are bipartisan issues in Michigan. Tired of waiting on Washington to act — similar to the President’s motivation for the jobs bill — Governor Rick Snyder has put forth an ambitious plan to invest in all kinds of transportation for the state.

Michigan citizens and local partners like the Michigan Municipal League or the Michigan Suburbs Alliance know that a successful future for Michigan hinges on making smart investments in transportation to keep people and goods moving quickly and safely, whether in a car over a repaired bridge, on foot to the corner store, or in a new light rail vehicle on the Woodward light rail line underway in Detroit.

We desperately need the fresh infusion of money into our deficient bridges and aging transit systems that the American Jobs Act would have provided. Unfortunately, the Senate failed to get the necessary 60 votes for cloture in the Senate to vote on the transportation portion of the American Jobs Act. But that doesn’t mean that it’s the end of the road for transportation funding. Far from it.

Attention in the Senate will now turn to the long-term transportation bill that’s seemingly been just over the horizon for months now. The Environment and Public Works Committee is expected to release their part of the bill this afternoon, for markup next Wednesday.

Though we do need the kind of infusion that the jobs act would have provided to get things rolling today and put people to work, we really need the certainty of a long-term reauthorization bill, new policies and clear reforms to make sure that we make the best use of our transportation dollars.

With Congress in limbo, Michigan Governor Rick Snyder puts promising transportation ideas on the table

More state and local officials are coming to grips with the fact that they cannot wait for Washington to act on infrastructure investment and repair. After two years of short-term extensions, a new transportation bill may or may not happen in the next six months. From a vantage point closer to their constituents, local leaders of all political stripes see the need for more immediate solutions — and know that the potential impact on the economy is too important to be ignored because of partisan squabbles.

Michigan Governor Rick Snyder (pictured at right), a Republican elected in 2010, is one of those leaders. And his new $1 billion blueprint for the state’s infrastructure, released earlier this week, does a commendable job of ditching ideological gestures in favor of common sense.

One of the more ground-shifting components of Snyder’s plan is his preference for rapid bus service in the Detroit area to complement and expand on the Woodward light-rail line already in the pipeline. As the Detroit Free Press discussed in an editorial this morning, it is likely that some will dismiss bus service as inferior to rail. That distinction is for Michiganders to decide, but Snyder’s willingness to consider a medley of transportation options should induce a healthy discussion.

He’s also willing to discuss revenue, which remains the most major hold-up in Congress. Under Snyder’s proposal, voters would get to decide at the local level whether to raise vehicle license fees by $40. Allowing for local debate and deliberation would likely increase the chances of new revenue being secured.

Snyder would also shift Michigan’s current gas tax to a levy as percent of the price per gallon, rather than a flat fee, a shift that is expected to increase overall receipts.

The additional revenue from both of these measures would fund road repair and public transportation, including enhanced bus and rail service in Detroit and its surrounding suburbs.

Now that Snyder has outlined his preferences, it is up the state legislature to make the next move. As the Free Press put it:

The governor has not solved southeast Michigan’s transportation problems. But in laying out a practical plan for providing — and paying for — rapid transit service, he has given leaders a road map to a better transportation future.

Photo courtesy of AnnArbor.com