State Funding Series Archives - Transportation For America

Passing Oregon’s transportation package was just the beginning of the hard work

Governor Kate Brown is conducting signing ceremonies in communities throughout Oregon this week to celebrate the passage of Oregon’s transportation package. While the governor, legislature, and stakeholders are enjoying this victory lap on a big legislative effort, the hard work of implementing the bill is yet to come.

“The transportation package is truly a roadmap to Oregon’s future. Let’s keep Oregon moving forward.” Gov. Kate Brown speaking at a signing ceremony earlier this week.

HB 2017 represents a big investment in transportation for Oregon – $5.3 billion over 10 years, with over $1 billion in state dollars dedicated to transit. But there are many questions remaining about how that funding will be spent.

Over the 10-year timeframe the package dedicates almost $800 million for a variety of earmarks; however, most earmarks are not cost-specific, shifting numerous critical decisions to later dates. Instead, each region receives a determined amount of funding for multiple projects.

This lack of specificity could be a curse or a blessing. Oregon’s DOT and the Oregon Transportation Commission (OTC) could interpret the lack of specificity as flexibility to spend designated dollars more effectively, like scoping projects to maximize return on investment. But to do so, they’ll need to apply “practical solutions” effectively.

The bill more than triples state funding for public transit. This will require the OTC to develop and finalize rules in less than a year for rationally distributing over $100 million each year in new funding to a wide variety of transit agencies — urban and rural, large and small. How will the OTC and local transit agencies quickly develop a process to demonstrate accountability and transparency in distributing and using that funding effectively?

A big challenge for implementers of this bill is that it’s not big enough to address everything. While the bill includes substantial new funding for repair, many roads and bridges in the state will continue to deteriorate. The freeway bottlenecks addressed in the bill are only a small subset of those in the Portland region, and may become clogged again due to induced demand in a few years. Will the public understand the limits of the package the legislature passed, even as they see their taxes increase?

The bill requires study and possible implementation of congestion pricing on major freeways in Portland. ODOT is already hiring for new positions to tackle this challenge. Congestion pricing (also called value pricing) has the potential to address many of Oregon’s congestion challenges in a fundamental way, but that doesn’t necessarily make it any easier. While shown to be highly effective in several cases, value pricing is politically difficult and a new technical challenge for Oregon.

Passing the bill was a huge success, but that was just part of what’s needed.

If Oregon’s leaders don’t construct a strong framework for accountability and measuring performance, it’ll be like making a great pass but then kicking the ball back into their own goal. Oregon’s work on this transportation bill is far from done, and those involved in passing the bill have much work to do to deliver on its promise to Oregonians.

Utah makes a bipartisan move to increase state and local transportation funding to help meet the demands of high population growth

Earlier this spring Utah became the third state in 2015 to pass a comprehensive transportation funding bill, raising the state’s gas tax and tying it to inflation. Unlike most other states acting this year, Utah raised revenues to invest in a variety of modes and also provided individual counties with the ability to go to the ballot to seek a voter-approved sales tax to fund additional local transportation priorities.

Fueled by the highest birthrate in the country, Utah’s population is expected to double by 2060. The state’s existing transportation funding sources — unchanged since 1997 and losing value against inflation — would not be sufficient to meet the demands posed by the rapidly growing population. Working proactively, the Utah Legislature and stakeholders worked together to raise new funding for transportation and ensure that the state stays ahead of the population boom.

TRAX Red Line to Daybreak at Fort Douglas Station. Flick photo by vxla. https://www.flickr.com/photos/vxla/

What does the new funding package do?

The new law, passed in March 2015, will generate approximately $74 million annually by replacing the cents-per-gallon gas tax with a new percentage tax indexed to future inflation. The bill also enables counties to raise local option sales taxes, which, if adopted by every county, would generate $124 million in new annual revenue specifically for local needs.

In specific terms, the bill replaces Utah’s current fixed 24.5 cents-per-gallon rate with a new rate of 12 percent of the statewide wholesale gasoline price, beginning January 1st, 2016, and indexes that rate to inflation. The bill also specifies that the tax can’t dip below the equivalent of 29.4 cents per gallon (i.e. a floor mechanism) or climb above 40 cents per gallon (i.e. a cap mechanism). Additionally, diesel, natural gas and hydrogen will see an incremental rise in their taxes until they reach 16.5 cents per gallon (an eight-cent increase for diesel and natural gas).

Importantly, the bill also enables all Utah counties to ask voters to approve a 0.25 percent local sales tax, the proceeds from which can be used to fund almost any locally-identified transportation need, whether roads, transit, bicycle and pedestrian infrastructure or other related projects. Revenues from these county sales taxes would be split between the county (20 percent), cities (40 percent), and a county’s transit agency (40 percent). If a transit service area doesn’t exist in the county, the money is split between the county (60 percent) and cities (40 percent).

Due to a constitutional restriction, all state gas tax revenue generated in Utah may only be used on roads, so this new optional sales tax gives counties and local governments a new mechanism to raise funds for their pressing needs, whatever they may be. While the state will see a much-needed revenue increase that can be invested in the state’s Unified Transportation Plan, the local option sales tax is a very important provision that could give localities of all sizes extremely flexible resources to meet their pressing local needs.

Lynn Pace, Vice President of Utah League of Cities and Towns

“There was a major push to say that we need a more multimodal transportation system,” said Lynn Pace, vice president of the Utah League of Cities and Towns. “We needed more flexibility, and that pushed people towards the [local option] sales tax because it was flexible, more flexible than the gas tax.”

Political compromises on the way to passage

At the end of 2014’s legislative session, a transportation bill that, much like this year’s bill, would have allowed counties to impose a voter-approved quarter-cent sales tax to fund transportation was defeated. There were other funding bills that died, including one that would have increased the gas tax by 7.5 cents per gallon and another that would have reduced the gas tax from 24.5 to 14 cents per gallon while adding a 3.69 percent fuel tax. In the end, there wasn’t adequate consensus between legislators to get a bill done in 2014.

This year was different, however.

The 2015 session started with an effort to raise or otherwise reform Utah’s gas tax. The Speaker of the House, Rep. Greg Hughes (R-Draper), wanted to drop the per-gallon flat tax and change it to a percentage tax so that the tax rose and fell with gas prices. Senate President Wayne Niederhauser (R-Sandy), however, felt that tying the gas tax to fluctuating gas prices was too risky. Prices could rise and fall dramatically, he said, subjecting Utah drivers to suddenly higher gas prices (or declining revenues coming to the state with low prices). To eliminate the uncertainty, Niederhauser wanted a straight increase in the gas tax.

Hughes however, didn’t believe that representatives in the House would pass a tax increase, fearing political fallout. Pegging the tax rate to gas prices would allow the state to eventually see revenues increase as gas prices rise without the political risk of imposing taxes immediately. In the end, the bill indexes the gas tax rate to inflation, but with a floor and ceiling put in place to counter destabilizing fluctuations in the gas price.

The importance of including the local option sales tax

Legislators had a similar back-and-forth on the bill’s other major revenue-raising provision: the local option sales tax.

Rep. Johnny Anderson (R-Taylorsville), the sponsor of this provision, wanted to ensure that money from the sales tax went to transit before it went to roads. Rep. Jim Dunnigan (R-Taylorsville), however, wanted to put that decision in the hands of the voters and local elected officials.

As legislators moved towards the end of the session, the House and Senate passed different versions of the transportation bill. The Senate opposed allowing counties to impose a voter-approved sales tax, but the House insisted. Eventually, the chambers came to an agreement, provided that local option sales tax revenues could go to not just transit but all forms of transportation, from roads to transit, bike and pedestrian infrastructure.

Staying on message

The 2014 debate on transportation funding by Utah legislators laid some of the important groundwork for this year’s success. But this time, several ingredients (and some notable changes) came together this year to help convince formerly skeptical legislators to vote yes.

The bill’s supporters — which included the Wasatch Front Regional Council, the Utah League of Cities and Towns, and the Utah Transportation Coalition, among others — were able to present a compelling and winning message about why Utah needed to raise additional dollars to invest in the transportation system. They talked about the critical economic development connection, as well as accommodating and moving more people and goods within the booming state over the next 25 years. Supporters educated both the public and legislators about why Utah’s communities need to be able to raise funds for and invest in multimodal transportation projects.

In a conservative state like Utah, supporters found that economic arguments worked best for convincing legislators and the public that transportation is a worthwhile investment. Their argument was two-pronged: first, a state with a good transportation network can more easily attract businesses, which need solid transportation infrastructure to attract talent, get their employees to work, and ship their goods, and, second, that waiting to repair critical transportation infrastructure will make maintenance cost more in the long run.

Read T4America’s separate 2014 profile of Utah’s “Can-Do” transportation ambitions.

With stories of partisan gridlock making headlines every day, Utah stands out as a model of collaborative planning for a better future. State leaders and citizens have managed to stare down a recession while making transportation investments that accommodate projected population growth and bolster the economy and quality of life.

Click through to read the full story.

To make sure that the message really resonated, supporters made sure that they were all singing from the same sheet.

The Utah Transportation Coalition — a group that includes the Salt Lake Chamber of Commerce and the Utah League of Cities and Towns — conducted two years of studies to find the facts they needed for their education campaign.

“What we did differently this year versus last year — in years past — is that we worked together, we were all in lockstep together, we knew our message, stayed on message,” said Abby Albrecht, Director of the Utah Transportation Coalition. “We worked really hard to be the voice in the community and in the legislature about transportation, why it was so important for our economy, for our quality of life, to our healthcare.”

A clear, unified plan for future investment

That singular message is captured in Utah’s Unified Transportation Plan, a statewide transportation plan synthesized from several regional plans and plans from the state DOT and the Utah Transit Authority. The unified statewide plan prioritizes those needs and outlines the $11.3 billion most critical projects to fund.

Having a statewide plan in which everyone could see their needs reflected helped everyone feel that the entire state was working together to develop a holistic vision for the future instead of a bunch of regions competing against each other for the same funds. That unity of purpose across the state helped bring legislators on board.

“Every legislator has skin in the game at that point,” saidMichael (Merrill) Parker, Director of Public Policy at the Salt Lake Chamber of Commerce. “It’s not urban versus rural, or region versus region; every legislator is in the same camp trying to solve one problem, not their local district’s problem.”

With a clear vision in hand, supporters worked hard to spread that message.

“There was a [unified] plan in place, an agreed-upon plan in place, saying, ‘This is what needs to be done, we all agreed that this is the plan, and here are the gaps in funding,’” said Pace, from the Utah League of Cities and Towns. “So, it put us in the position to say, ‘We all agreed what needs to be done. Utah’s population is going to double in the next 30 years, we need funding to implement the plan, to help make it happen.’”

All of that education paid off.

The law passed the House on March 9th and in the Senate on March 12th. Governor Gary Herbert signed the law on March 27th. This provides counties the ability to place local sales tax referendums on the ballot as early as November 2015.

On to the ballot box

Supporters cheered the bill’s passage in March, but there are still important hurdles to clear to reach the bill’s full potential. The bill could raise an additional $124 million annually for transportation if adopted by all Utah counties. Groups like the Salt Lake Chamber and Utah Transportation Coalition are embarking on public education campaigns in the counties that are placing local sales tax questions on their November ballots.

110 of Utah’s 244 cities have passed resolutions urging their county governments to put the proposition on November ballots, and as of August 24th, 12 of Utah’s 29 counties have taken action to do exactly that. That list of 12 counties includes Salt Lake County, the state’s most populous county, and where, according to the Salt Lake Tribune, elected officials in all 16 cities supported the county’s action in August 2015 to place the initiative on this November’s ballot.

Salt Lake County Mayor Ben McAdams

The mayor of that county, Salt Lake County Mayor Ben McAdams, knows how important investing in Utah’s transportation is, especially since his region is the most populated in the state:

“We want to have a visionary approach to transport, where we look into the future and forecast what our region is going to look like. We know that a transit-oriented future will improve quality of life, save tax dollars, and really help us develop the kind of community we want to live in. That all takes forethought and planning.”

This year’s move by the legislature was a triumph of bipartisan cooperation and compromise, undergirded by the clear vision for investment that local leaders and civic groups have bought into. As a result of their successful work, the state will see an increase in transportation funding in 2015, but we’ll be watching especially closely this November as Utah counties join countless others in deciding measures at the ballot to also raise new local money for transportation.

Need a quick summary of Utah’s transportation law? You can read it here.

Want more information on states moving to raise new transportation revenues at the state or local level? Don’t miss our page of resources chronicling the active and enacted plans since 2012.

Iowa was the first to successfully raise new state transportation funding in 2015 – and they did it with bipartisan support

Iowa in February became the first state in 2015 to pass a transportation-funding bill when legislators moved to raise the state’s gasoline and diesel taxes by 10 cents per gallon.

Though seven states have now successfully moved to raise new transportation funding in 2015, Iowa made it to the finish line first. On February 25^th, Republican Iowa Governor Terry Branstad signed a bill into law that increased the state’s gasoline and diesel fuel taxes by 10 cents per gallon, raising new funding to help maintain the roads and bridges crisscrossing one of the most important states for freight and agriculture in the U.S.

Iowa governor Terry Branstad.

In signing the bill, Branstad said: “This is a great example — on a difficult and controversial issue — of the kind of bipartisan cooperation that really makes Iowa stand out as a state, where we work together and we get things done on behalf of the citizens of our state. This is important for economic development. This is important for our farmers to be able to get their crops to market. I know that many people have been waiting a long time for the legislature to act.”

The increased gas tax — the rate on regular gas rose from 21 to 31 cents per gallon, and the rate for diesel rose from 22.5 to 32.5 cents per gallon — and other associated fees took effect on March 1^st. Last week, Iowa’s Department of Transportation stated their plans to use the new funds toward $700 million in road maintenance and construction projects.

“I feel Iowa took a huge step forward by addressing our aging infrastructure,” State Rep. Josh Byrnes (R-Osage), chairman of the House Transportation Committee, told AgriNews. “It shows that Iowa is truly open for business and we have the leadership to make difficult decisions. Iowa is a net exporter of goods and these funds will help ensure that Iowa continues to have the needed infrastructure to transport people and products.”

HISTORY LESSON

At the start of the legislative session, Iowa was facing an estimated $215 million annual gap between revenues and needs, according to the state Department of Transportation. The state’s gas tax was last raised in 1989 to 19 cents per gallon, during current governor Terry Branstad’s first foray as governor of the Hawkeye State.

For years, key legislators and business leaders pushed for meaningful legislation to bolster transportation funding, but they never gained enough momentum to pass it, said Senator Tod Bowman (D-Clinton), chair of the Senate Transportation Committee. “We couldn’t drum up enough support. We didn’t really have the leadership from the Governor,” he said.

This year would prove to be different, however.

Iowa state representative Jim Lykam.

Gov. Branstad’s vocal support was critical in convincing Republican lawmakers that this was a must-pass piece of legislation for the state, said State Rep. Jim Lykam (D-Davenport), the ranking member of the House Transportation Committee. “We were in constant communication with the governor’s office,” he said. “You always run the risk of sending the bill down and having the governor veto it, and we needed to make sure this wouldn’t happen.”

The bill had to jump an atypical hurdle before it passed. The Senate minority leader and the House speaker required that the bill garner “yes” votes from the majority of each minority party in each chamber. This unusual requirement meant that the bill would not move without widespread consensus.

“This consumed me for the first six weeks of the session,” said State Rep. Lykam. “It was just back and forth negotiations. You try and do something — you pick up votes, but then you lose votes over here — so it was a give and take.”

IOWANS GETTING INSPIRED IN DENVER

Just before their work began in the new legislative session in January, Rep. Lykam and Senator Bowman attended Transportation for America’s Capital Ideas Conference in Denver in November 2014, which helped them find focus and fresh ideas that they brought back to Iowa. Senator Bowman learned from a group of attendees from Massachusetts about the pros and cons of tying any future gas tax increases to inflation.

Scott VanDeWoestyne, the government affairs director for the Quad Cities Chamber of Commerce — another Capital Ideas attendee — said the conference helped light a fire under him and the two legislators.

“They were able to come back from Denver, and come here to the Quad Cities region and engage in good conversation,” VanDeWoestyne said. “Good comprehensive discussions with their colleagues about, ‘Hey, these are some of the other things states are doing, and we need to be focused on this.’”

VanDeWoestyne also stressed the importance of Iowa’s transportation funding bill to the Quad Cities metro area.

“Our economy in the Quad Cities region is growing fast,” he added, “and the state’s transportation investments have had a tough time keeping pace. This is one of the reasons we have championed greater federal and state transportation investments in Iowa. So, it was very heartening to see this year that Iowa moved towards a solution, and we’re happy to be a part of the compromise.”

EDUCATING THE MASSES

As with any piece of legislation that involves new taxes, not all Iowans were on board. A coalition of stakeholders from across the state focused on educating legislators and the general public and establishing consensus that the transportation package was necessary to support economic development and provide better quality of life to the state’s residents.

Iowa state senator Todd Bowman.

“The more that people know about the issue, the easier it is to push a difficult thing like a tax increase,” said Senator Bowman. “Nobody wants to pay more taxes for their fuel. But nobody wants their roads and bridges to deteriorate, and so it becomes a point of education.”

THE GOVERNOR’S SUPPORT

Rep. Lykam cites the governor’s continuous support as one of the critical reasons why this bill gained the broad agreement needed to pass the legislature. “When the Governor grabs the microphone, you know he’s got the bullhorn for the full state,” said Lykam. “It was very, very important that we had his support.”

It took a few years, a broad coalition of stakeholders and bipartisan consensus, but Iowans have shown what can be accomplished when partisan politics are set aside to raise the necessary revenue to maintain and enhance their transportation system to support the state’s economy.

As we note here often, the Iowa legislature acted to expand their capacity to match and stretch the dollars they expect from the federal program. Congress needs to act, in turn, to stabilize and increase that funding, to ensure that the bold moves in state houses this year are not undermined by a wobbly federal partner.

States continue to take action to solve transportation funding crises

This year started with a transportation bang for many states across the country. In the last few weeks, four states in particular have made major strides in funding transportation and infrastructure projects as gas prices continue to remain low.

Georgia transportation officials have said they are facing an annual, billion-dollar funding gap to maintain their existing roads and bridges in good condition.Last week, the Georgia House passed HB 170which would make a few notable changes to their current funding structure, where they currently use both a sales tax and a per-gallon excise tax on gasoline. HB 170 would remove the current sales tax on gasoline entirely and increase the current 8.2 cents per-gallon rate by 21 cents for a new rate of 29.2 cents per gallon. The bill also requires the rate be adjusted annually to adapt to growing vehicle fuel efficiency and inflation in the cost of highway construction.

Besides the excise tax, the legislation would also impose new fees on private electric cars and commercial electric vehicles. The bill has been sent on to the state Senate.

In North Carolina, where gas tax rates are pegged to fuel prices, the House and Senate are moving competing bills to address an expected multi-million dollar shortfall resulting from cheaper gas and growing efficiency.

The Senate’s version, SB 20, eventually would raise the floor for the sinking gas tax from 21 cents per gallon to 35 cents per gallon, and increase the percentage rate on fuel from 7 percent to 9.9 percent. But it actually would cut the fuel tax by 2.5-cents per gallon between now and December. This would reduce transportation funding by $33 million between now and July, but is expected to raise an additional $237 million next year and $352 million a year by 2018.

Last week, the House passed a version of this bill that would reduce the current rate of 37.5 cents a gallon to 36 cents and hold it at that rate until the end of 2015. Delaying an expected drop in the adjustable, percentage gas tax rate (a consequence of falling gas prices) would bring in an additional $142 million during the next fiscal year (or approximately half of the Senate’s version).

In Utah, the Senate acted Monday to raise gas taxes for the first time in 18 years, increasing it by 5 cents per gallon this year, with an additional penny added each of the next four years. The state is currently looking at a deficit of $11 billion over the next two decades if the legislature does not act now. Consideration of the plan now moves to the House, where leaders are considering a slightly different approach.

Coming off a bold call to action in Governor Jay Inslee’s State of the State speech, Washington’s Senate on March 2 passed a $15 billion transportation package paid for by raising gasoline taxes by 11.7 cents over the next three years. It also would allow certain localities, including Seattle, to ask their voters for additional transit funding in the coming years.

Iowa, in the meantime, already has passed and enacted a transportation revenue package. Strongly supported by Governor Terry Branstad, the bill increases Iowa’s state gas tax by 10 cents per gallon. New funds will go entirely to highway projects, as required by a restrictive state constitutional requirement in place in Iowa and dozens of other states.

Watch this space for a more in-depth look into how business community and other supporters, along with legislative leaders, helped move the package to passage.

After years of depressed revenues and growing needs, states are making big moves on transportation this year. Whether or not they have long-term economic payoff will hinge on the degree to which their cities and towns get the resources and latitude they need to compete in the 21^st century.

Make sure to check back with our resource that tracks state transportation funding for the latest updates; you can also sign up to receive the latest news and updates.

Update on 17 states moving to raise money for transportation

From Washington to South Carolina, 17 state legislatures (with others likely to follow) are debating plans to raise new revenue for transportation after a decade in which their primary funding sources shrank and federal support became increasingly uncertain. See the current state of play in our freshly updated national roundup. (Updated 2/25/15)

View our updated resource tracking state transportation funding plans here.

Among those 17 states, Iowa, Georgia, and Washington have been in the news over the last two weeks due to significant progress made toward producing a funding package in their state legislatures.

In Washington, a (still contentious) plan currently before the full Senate would raise the gas tax by a total of 11.7 cents per gallon by 2018. In Iowa, Gov. Terry Branstad just signaled that he would likely support a ten-cent increase in the state gas tax if the legislature can come together to pass one and send it to his desk for approval. In Georgia, the House Transportation Committee passed a bill to replace the state’s sales tax on gasoline with a 29.2 cents per gallon tax and give counties more authority to tax gasoline; floor debate has been postponed while supporters work to round up votes.

Update: Iowa’s package passed both House and Senate on Tuesday afternoon. Link. -Ed.

Most states rely heavily on their taxes on gasoline and diesel fuel to provide their share of transportation budgets, and those sources have taken a hit as vehicles have become more efficient, per-person driving mileage has declined and construction costs rise along with inflation — the same forces that have been squeezing federal funding and the 18.4 cents-per-gallon gas tax. Unchanged since 1993, the federal gas tax has lost approximately one-third of its purchasing power. In 2012, Congress did something it had not done in decades, passing a federal transportation law that failed to increase funding. In 2014, Congress punted on a long-term solution, scouring the couch cushions once again to scrape together enough funding to keep the program hobbling along until May 2015.

Even if Congress comes through, the aging infrastructure in need of repair in many states and the demands coming from demographic and economic changes mean states need more revenue, not less. (And yes, many states also need to dramatically reform how they spend the dollars that they have, which can go a long way toward building the public confidence required to successfully taxpayers for additional money.)

One key lesson worth noting up front that we shared yesterday: Legislators who supported such moves have met with little to no pushback at the polls. Our updated analysis of November’s election data should be instructive for the legislators currently weighing action: 90 percent of legislators supporting revenue increases in ten states since 2012 won their re-election bids.

We’ll be following the action in these states closely and likely adding more to the list, so stay tuned.

With GOP victories, SAFETEA-LU team in line to chair Senate committees

With last night’s election, both the Senate and House will see leadership changes in key transportation committees. With the nation’s transportation funding source running near empty and the current law, MAP-21, expiring in the spring, these new committee leaders will have an opportunity to make an impact in the very near term.

First, the Senate, where the Environment and Public Works Committee writes the largest portion of the transportation bill, the “highway title”. Chair Barbara Boxer (D-CA) is expected to yield the gavel to Sen. Jim Inhofe (R-OK). Though the two worked closely together on MAP-21, Inhofe has indicated that he plans to conduct EPW business differently than his predecessor, and it’s unclear at this point exactly how he would stray from the current course.

The next biggest piece of the Senate bill, the “transit title”, is written in the Banking Committee, where Richard Shelby (R-AL) is in line to become chair. The Inhofe-Shelby pairing also led negotiations on SAFETEA-LU – MAP-21’s predecessor – in 2005.

In the House Transportation and Infrastructure Committee, Ranking Member Nick Rahall (D-WV) — amazingly a member of this committee his entire time in Congress — lost re-election to his 20th term, which eliminates the top Democrat on the committee. Rep. Peter DeFazio (D-OR) is next in line for the top Democratic seat on the Committee, and is a familiar and vocal proponent of a strong federal role in transportation.

That covers the policy side of the equation. On the funding side, Utah Sen. Orrin Hatch (R-UT) is projected to take over the Finance Committee, swapping roles with Sen. Ron Wyden (D-OR). On the funding side in the House, Rep. Paul Ryan (R-WI) is expected to take over the Chair of the Ways & Means Committee for retiring Rep. Dave Camp (R-MI).

In the short-term, the biggest battles will come over annual appropriations, setting the spending levels for discretionary programs such as TIGER and Amtrak. The first order of business for Congress when it returns next week is extending the continuing resolution – a temporary funding measure – that expires in December long enough to allow appropriators to hammer out spending levels for the full fiscal year. That will now likely occur under the GOP-controlled Congress early in the next calendar year.

The 800-pound gorilla of questions marks though, is how Congress will fund the nation’s transportation system next year and beyond. Gas tax receipts are dropping, cars are getting more fuel-efficient and driving is leveling off – and most baby boomers haven’t even stopped commuting yet. Although a faction of Republicans has called for the feds to abandon their traditional role and devolve the lion’s share of responsibility and oversight to the states, that idea so far has not gained traction with the full caucus. Though yet another short-term fix was agreed to a few months ago to keep the program going into next year, that funding will be tapped out by Spring 2015, and the trust fund will be near insolvency yet again.

Raising the gas tax may be a non-starter in a GOP Congress, though that remains to be seen. Other revenue ideas have struggled to gain a foothold, including the House GOP proposal during the last reauthorization to boost revenue with fees from expanding oil and gas drilling into formerly protected areas. On the Democrat side, DeFazio has introduced legislation to replace the federal gas tax with a fee at the refinery level that would be indexed to inflation, potentially yielding a more stable funding source.

In all, Tuesday’s election results should make for a fascinating 2015.

Important transportation ballot measures decided yesterday

Despite the defeat Tuesday of some high-profile measures, transportation funding asks continue to be approved at very high rates – and a few key wins may have impact for years to come.

While some of the key measures we were tracking did not fare well, on the whole, transportation (and transit specifically) did well at the ballot box (See the full list of measures we’re tracking below.) According to the Center for Transportation Excellence’s final results, 72% of all transit or multimodal measures were approved this year, including yesterday’s results – similar to the trend of recent years.

One of the most significant measures at the state level was considered in Massachusetts, where voters were deciding whether or not to repeal a legislature-approved provision to index the gas tax so revenues could keep up with inflation and allow the state to keep up with their pressing transportation needs. The measure to repeal was approved, albeit at a fairly close margin (52.9-47%), which means that Massachusetts will lose a portion of their new funding for transportation, but not all — they also raised their gas tax by three cents, but that was unaffected by this ballot measure.

The Massachusetts vote was definitely one that other states were watching closely as a potential bellwether for attempts to raise new revenue elsewhere. As Dan Vock at Governing Magazine wrote today, “That is not good news for transportation advocates, who are looking for politically feasible ways to raise money for infrastructure improvements.” Though a handful of other states did succeed in raising their gas taxes over the last couple of years, it’s possible that more states hoping to raise revenues in the next few years will consider a shift away from the per-gallon tax to a sales or wholesale tax (as Virginia and Maryland did for example) rather than trying to add in automatic indexing, which many voters saw negatively in Massachusetts.

Rhode Island voters approved a statewide ballot measure to fund some pretty significant transit improvements across the state, including new transit hubs to connect their popular passenger rail services with buses and other forms of transportation, and improvements to the statewide bus network. Scott Wolf, the executive director of Grow Smart RI, which ran the campaign on the measure, was full of praise today:

We commend our fellow Rhode Islanders for recognizing that these investments will provide benefits far beyond their costs and make it easier for the state to retain and recruit a young, talented and mobile work force. If we can continue to pursue this kind of asset based economic development strategy under Governor-Elect Raimondo, we at Grow Smart RI are confident that Rhode Island’s best days will still be ahead of us.

At the local and regional level, there was perhaps no more significant symbolic vote than the one taken in metro Atlanta yesterday. For the first time in more than 40 years, Atlanta’s MARTA system will be expanding into a new county, as Clayton County, Georgia overwhelmingly approved (73% in favor) a one-percent sales tax increase to join MARTA, expand bus service into the county, and save half of the projected revenue for planning and implementing a possible rail connection into the county.

Clayton was the only one of Atlanta’s five core counties that lacked a local public transit system, and there was a surge of momentum for this referendum after a limited county bus system folded in 2010. When it did, Clayton State University saw a drop in enrollment and scores of jobs at Atlanta Hartsfield-Jackson Airport got much harder to reach for county residents.

From a regional perspective, with more of the region now having a stake in MARTA — it was intended to serve all five metro counties when it was created, but only two opted in — the agency will expand their base of users and bring more local officials to the table who care about seeing it succeed. And the resounding vote of support with local dollars will likely help continue develop support from the state legislature, where MARTA CEO Keith Parker has been hard at work to create allies for the only major transit agency that receives no dedicated funding from the state.

The news was not so good one state further south, where Pinellas County, Florida (St. Petersburg/Clearwater) saw their Greenlight Pinellas referendum roundly defeated, with only 38% in favor. (A smaller similar measure was also defeated in Polk County, to the east of Tampa.) The referendum would have made enormous expansions to their existing bus service, added new bus rapid transit corridors, and begin laying the groundwork for light rail running through the spine of the county.

It’s a blow not just for Pinellas County, the most densely populated county in the state, but also for the Tampa region at large. Business and civic leaders were hoping that Pinellas would take a first step that Tampa would follow in 2016 with a measure of their own, as they stitch together a region with two major cities divided by the bay. Pinellas leaders can take heart, however, in the fact that many places have lost their first (or even second) run at an ambitious ballot measure, before winning in the end.

We’ll be back shortly with a look at some of the national and state candidate races, and the implications of all the moves in Congress will have on the precarious nature of the nation’s transportation fund, and the upcoming reauthorization of MAP-21 in 2015.

State

Massachusetts – Question 1 to repeal state’s new funding for transportation
Result: Measure Approved (52.9% – 47.1%)
T4A summary: Massachusetts vote a bellwether for efforts to raise state transportation revenue

Rhode Island – Question 6 transit bond measure
Result: Measure Approved (60% – 40%)
T4A summary: Rhode Island’s first statewide ballot measure to support transit

Wisconsin – Question 1 for transportation funding
Result: Measure Approved (79.9% – 20.1%)
T4A summary: Voters in two states consider measures to restrict funding to transportation uses

Maryland – Question 1 on transportation funding
Result: Measure Approved (81.6% – 18.4%)
T4A summary: Voters in two states consider measures to restrict funding to transportation uses

Texas – Proposition 1 to direct rainy day funds into highways
Result: Measure Approved (79.8% – 20.2%)
T4A summary: Texas looks to voters to ensure billions in highway funding

Louisiana – State infrastructure bank
Result: Measure Defeated (67.5% – 32.5%)

Local

Clayton County, GA – One percent sales tax to join MARTA and re-start bus service
Result: Measure Approved (74% – 26%)
T4A summary: After spurning it for decades, suburban Atlanta county seems poised to join regional transit system

City of Seattle, WA – Proposition 1 to add a 0.1% sales and use tax to prevent bus cuts
Result: Measure Approved (59% – 41%)

Austin, Texas – Proposition 1 for $600 million bond for light rail
Result: Measure Defeated (43% – 57%)

Pinellas County, Florida (St. Petersburg) – Greenlight Pinellas for improving transit service & adding light rail
Result: Measure defeated (38% – 62%)
T4America summary: Leaders say St. Petersburg measure key to economic success

Alameda County, CA – Measure BB for a half-percent increase in sales tax to fund local transit and transportation projects
Result: Measure Approved (70% – 30%)

Gainesville, FL (Alachua County) – 1% sales tax for a range of transportation improvements
Result: Measure Defeated (40% – 60%)

Vermont, New Hampshire, Massachusetts follow the trend: voters support transportation revenue increases

As voters have been proving over and over during primary season this year, raising taxes or fees for transportation isn’t a political death sentence – no matter the party or political affiliation. In the past two weeks, Vermont, Massachusetts, and New Hampshire’s state legislators faced their first primary since voting to pass bills to raise additional state revenue for much needed transportation and infrastructure projects.

See all the primary results in states that have approved transportation fee increases here.

Vermont passed House Bill 510 in March 2013, to diversify their transportation revenue by introducing a 4 percent sales tax on the price of gas. This raises the overall gas tax by 7.5 cents, though it put a floor and a cap on the new sales tax portion so that Vermont drivers will never pay less than 13.4 cents per gallon or a maximum of 18 cents. H.B. 510 also authorized $10.38 billion in bonds.

“It was not an easy choice to move in this direction, and we didn’t make this decision lightly,” said House Transportation Chair Pat Brennan (R-Colchester) said at the time.“ We explored anywhere between 15 to 20 different funding options, and we ended right back here every time.”

The measure passed 128-42, with 18 Republicans and 104 Democrats voting “aye.” Of the 15 supportive Republicans who ran again, just one lost in the primaries on August 26^th. Leigh Larocque (R-Barnet) lost to Marcia Robinson Martel. All of the 86 Democrats who supported the bill and ran for re-election won their primaries.

Massachusetts’ ambitious H3535, enacted in 2013, raised the gas tax 3 cents and indexed it to inflation, while also requiring the Massachusetts Department of Transportation and Massachusetts Bay Transportation Authority to raise a greater portion of their costs – up to an additional $229 million a year — through various avenues including tolls, fees, fares, and others.

In the heavily Democratic state, the bill passed 158-38, with 157 Democrats and just one Republican voting yes. All but one of the 133 supportive Democrats running for re-election won their primaries, with Rep. Wayne Matewsky (D-Everett) losing his seat to Joseph McGonagle, Jr.

(There is a footnote to these results in Massachusetts. A measure has been added to this year’s November’s ballot to reverse the legislation completely. One benefit of that is that, after these primaries, we’ll have another public referendum on raising transportation revenues put directly to the voters. It’s just one of many important ballot measures we’ll be keeping a close eye on here this November, so check back. – Ed.)

New Hampshire has a very similar story. In 2013, lawmakers approved Senate Bill 367, which increased the per gallon tax by 4 cents. The funds raised were dedicated to rehabilitation and bridge repair projects for the next two years. In the last version of our report on bridge conditions in 2013, New Hampshire had the eighth-worst bridges in the country, with 14.9% of all bridges rated structurally deficient. The bill also added bonds for the widening of Interstate 93.

The bill passed 208-150, with 186 Democrats and 22 Republicans voting in favor of upping the state’s investment in transportation. Just three of those supportive legislators running for re-election failed to keep their seats, meaning 98.13 percent kept their seats after supporting SB 367. 21 state legislators decided not to run for re-election for various reasons.

John Graham (R-Bedford), William O’Neil (D-Manchester), and Steven Briden (D-Exeter) lost their seats in Tuesday’s primary. As of this writing there is no indication that the transportation revenue vote was a primary culprit.

Among all states holding primaries after a transportation tax increase – these three plus Pennsylvania, Virginia, Maryland, and Wyoming – supportive legislators have kept their seats at a rate of 98 percent. Voters clearly have been rewarding their state legislators who are brave enough to make the hard decisions when it comes to funding transportation and infrastructure.

All of the primaries this season in the states that we’re following have occurred, so we’re wrapping up this series for now. But all of these results are chronicled in one place now on our website, along with our page tracking all of the considered and enacted state plans to raise transportation revenue.

A dozen states have moved to raise transportation dollars, with more to come: Track them here

With Congress continuing to flail on providing stable funding, many states are finding they can’t wait and are moving on their own. But it’s not always as simple anymore as adding pennies to a per-gallon gas tax, so states are taking some creative approaches.

You can learn about what 12 states already have done – and the political fall-out from it – with our revamped and refreshed tracker. You’ll also see what’s brewing in still more states.

With the Highway Trust Fund still headed for insolvency due to declining vehicle miles traveled and more fuel-efficient vehicles, states have increasingly been coming up with their own plans for raising additional transportation revenue over the last few years — and 12 states have approved plans to raise additional revenues.

Version 2.0 launching today has plenty of new information on these state plans with some comprehensive details on how votes broke down on successful bills. Perhaps most interestingly, you can see how voters responded to those politicians who supported plans to raise additional transportation revenue.

Want a hint about that one? How about this:

View “How do voters respond to state legislators raising transportation taxes?“

As we’ve been chronicling on the blog for the last couple of months, the conventional wisdom has been turned on its head with the recent primaries in these states — members of both parties supporting any sort of tax or fee increase for transportation have been winning their primaries almost across the board. With Massachusetts and New Hampshire primaries taking place Tuesday of this week (as well as Vermont just a few weeks ago), we’ll update the numbers on this page later Wednesday — numbers we don’t expect to change a whole lot.

This updated resource provides detailed information on and bill numbers for the current (or immediately recent) funding plans that were considered as well the 12 successful plans to raise revenue at the state level for transportation.

Click on through to see the full array of information, including tables with the vote results on the bills and results from the primaries for supportive elected representatives.

Did we miss something? Let us know.

Want to learn more about state and local transportation funding?

This afternoon, along with the Center for Transportation Excellence, we’re hosting a half day event to examine state and local transportation funding campaigns at the ballot box and beyond. While many of you who might like to attend won’t be there in the room with us, you can follow the conversation from us and hopefully many of the participants on Twitter.

Measuring Up 2

This afternoon’s event is part of Infrastructure Week 2014 in DC, an event to “focus on the consequences of inaction and the importance of interconnected infrastructure that provides a safe, secure and competitive climate for business operations nationwide.”

Our event focuses specifically on ballot measures or state legislation raising funds for transportation at the local level.

In cities, towns and suburbs across the country, local leaders are responding to new economic challenges with ambitious plans for their transportation networks. Scores of local communities across the country are finding ways to put their own skin in the game first with local funding while hoping for a strong federal partner to make those plans a reality.

Local leaders from Indianapolis, St. Louis, Atlanta, Nashville and Los Angeles among others will be on hand to share how they’ve successfully passed ballot measures or state legislation. There’s a lot to learn and we’ll be releasing some new materials later this week about the world of ballot measures and state legislation raising money for transportation. For example, did you know that all but 12 states have considered revenue-generating transit or multimodal ballot measures since 2000? And nearly half of those were measures to raise sales taxes?

Follow along this afternoon with the hashtag #MeasuringUp, where we’ll be sharing useful nuggets throughout the afternoon and hopefully participants will be as well. And the broader conversation for Infrastructure Week can be found at #RenewRebuild

And tweet right at us at @t4america and @CFTEnews

Locals encountering help or hindrance from states on their transportation plans

Flickr photo by John Greenfield http://www.flickr.com/photos/24858199@N00/10090187245/

Several places have been in the news lately as they find their ambitious efforts to solve transportation challenges hinging on legislative action this lawmaking season. In some, state legislators are helping out with enabling legislation, but in others they are challenging the concept of local control and threatening needed investment.

The prime case of the latter has been in Nashville, where a handful of Tennessee legislators decided to interfere in a regional Nashville plan to build a first-of-its-kind bus rapid transit system through the region’s core.

An initial measure from a non-Nashville lawmaker would have required a vote of the General Assembly to approve the BRT line, despite the state DOT’s role in planning the line as a member of the Nashville Metropolitan Planning Organization’s board. An amendment to an unrelated bill said flatly: ”No rapid bus project in a metropolitan form of government, such as Nashville, could be built without the permission of the … General Assembly.”

Mayors of Tennessee’s four large cities immediately saw the threat that legislative micromanaging posed to their ability to meet their economic challenges and fired off a letter (pdf) that helped persuade legislators to try a different tack. The House version now simply affirms the status quo that the DOT must approve use of state right-of-way for a transit line and that only the legislature can appropriate state funds.

But new language was added in the Senate’s version that would prohibit any transit system from picking up or dropping off passengers in the middle of state roads as a “safety” measure — exactly what’s planned for The Amp line — regardless of what the Federal Transit Administration or engineers at TDOT have to say about the safety track record of center-running BRT. (Center running BRT is already in use or on the way in Cleveland, OH; Eugene, OR; San Bernardino, CA; Chicago, IL; and a handful of other cities.)

Current conditions on Ashland in Chicago, and rendering of the new planned center-running BRT for the corridor. Does one of these streets look safer for pedestrians than the other?

In Indiana, meanwhile, the legislature finally granted metro Indianapolis the right to vote on funding a much-expanded bus network, including bus rapid transit. What it won’t include is light rail, as dictated by the new law, which would allow six counties to hold referendums to let voters decide whether to build a transit system using mostly income-tax revenue, according to the Indianapolis Star.

Despite the mode-specific directive, it was a big victory for the business community, who pointed out that the state stands to benefit if growth engine Indianapolis continues to succeed economically. The region is a hotbed of healthcare jobs, and once again, providing a better bus system — something Mayor Greg Ballard and region’s other leaders are committed to doing — means that those employers get access to a bigger pool of workers, and workers of all incomes can reach a greater range of jobs.

Four years after their bus service was completely canceled, Clayton County just south of Atlanta proper is catching a helping hand from the Georgia general assembly. Lawmakers just passed a measure that would allow Clayton County voters to vote on approving a penny sales tax to restore local transit operations — something voters, local leaders and citizens alike strongly support.

When Clayton County lost that bus service, they lost something that employers — especially those at Atlanta Hartsfield-Jackson Airport — depended on to get employees to work every day. There are thousands of jobs at that enormous airport right at the edge of Clayton County, and a good transit connection was a boost for jobs and residents to benefit from that economic magnet.

Up in Minnesota, the state is moving a huge comprehensive funding package for transportation across the state — one of many states considering ways to raise their own new revenue for transportation. (See our tracker) A House committee voted 9-6 Friday to pass the comprehensive transportation funding bill (HF 2395). Similar legislation didn’t make it through the House committee in 2013.

Supporting and enabling these efforts is exactly what states should be doing as local cities and regions are trying desperately to make these sorts of investments a reality, usually with their own skin in the game; not obstructing them at every turn.

When a city or region wants to raise a tax via public ballot vote to improve their transportation network, shouldn’t the state leaders proudly support those efforts of a city bootstrapping their way up?

Editors note: We’re in the process of updating it with 2014 information, but you can find similar information to the Minnesota plan over on our State Funding Tracker, which focuses largely on state (i.e., not local) plans to fund transportation.

In 2013, 20-plus states took up transportation funding: Here’s the final tally

Welcome to 2014! With a large number of state legislatures convening as the new year gets underway, it’s worth a look back at an important trend from 2013: States stepping forward to raise additional money for transportation. With federal funding remaining flat in 2012′s transportation bill (MAP-21) and after years of deferred action during the long recession, a large number of states, metro areas and local communities moved to supplement federal dollars with new revenues of their own.

In April, we reported that 19 states were looking at ways to increase their own funding for transportation. Some needed the funds just to make ends meet after years of flat or declining state revenues, while others also were looking for funds to match those available from MAP-21 new and updated loan and grant programs (like TIFIA or TIGER).

Here’s how they fared:

Key Successes

We covered Maryland’s ambitious plan on this blog, as well as Massachusetts.

Both of those states’ plans indexed the state gas tax to keep pace with inflation — something the federal gas tax, unchanged since 1993 — does not do. In Maryland, the state also added a sales tax on gasoline, while in Massachusetts, the package included an increase in cigarette taxes and certain business taxes. The good news was that in making the changes, both states recognized the importance of all modes of transportation and the revenues will fund important transit and road projects around the states.

In Virginia, Governor McDonnell began the debate with a proposal to abolish the per-gallon gasoline tax entirely and replace it with sales and wholesale taxes on fuel. That brought together legislators from both parties, who developed an innovative package of revenue increases to put transportation funding on a long-term, stable footing.

New legislation raised vehicle fees, along with local taxes in two of the states’ most heavily populated areas, Northern Virginia (near Washington, DC) and Hampton Roads (near Norfolk/Virginia Beach on the coast). Recognizing that businesses, residents, and visitors to Virginia depend on many types of transportation to move around the state, the new law directs funding to all modes of surface transportation, including transit, passenger rail, roads, and bridges. The package is projected to have more than $9.5 billion in economic impact in the state. As the Gov. McDonnell said in signing the bill: “This legislation will ensure that Virginia’s economy can grow in the years ahead, and that businesses will have the infrastructure they need to create the good-paying jobs Virginians deserve.”

Most recently, legislators in Pennsylvania reached agreement on a package of tax and fee changes that will raise $2.3 billion annually for the state’s transportation infrastructure – $1.65 billion for roads and bridges and $475 million for transit. The debate went down to the wire with agreement finally reached in a special legislative session just before Thanksgiving, allowing the governor to sign the bill on a cold day in late November.

AP photo by Nabil Mark – Gov. Tom Corbett, center, signs into law a bill that will provide $2.3 billion a year for improvements to Pennsylvania’s highways, bridges and mass-transit systems.

The PA legislation eliminates the retail tax on gasoline and a state cap on gas tax paid at the wholesale level and raises various vehicles and driver fees over the next five years. The new funding will help to advance projects like the rehabilitation of the structurally deficient Liberty Bridge in Pittsburgh and of outdated equipment used by SEPTA.

Not all states that raised money recognized the value of investing across the board in all types of transportation to keep their economies moving. Ohio, Wyoming, and Vermont enacted tax increases intended for highway projects only. In Wisconsin, new bonding authority was enacted, with bond funds directed almost entirely to highways.

One positive outcome in Wisconsin: While the governor had proposed kicking transit out of the state transportation fund (similar to what the House of Representatives proposed in 2012), the legislature rejected that proposal and instead transferred general fund money into the fund (much as the federal government has done for its highway trust fund) to keep funding public transportation.

Try again next year!

Some states explicitly punted the issue to next year by creating commissions to report back to the legislature on transportation revenue options.

In Indiana, where a bill had been moving forward to allow the central Indiana region (which includes Indianapolis) to raise their own regional taxes to pay for transit, legislators instead commissioned a study on how to fund transit in the region. In November, the transit study commission voted in favor of allowing counties in the Indianapolis region to impose an income tax or business tax increase, if approved by a voter referendum, to fund regional transit. Reports like these help reinforce the notion — which we agree with — that regions should always have the ability, especially with the blessing of voters, to raise their own revenues to invest in regional transportation needs. We will definitely be keeping Indiana on our “watch list” for 2014.

Another state to watch in 2014 is Washington, where legislators negotiated on transportation funding through mid-December before calling it quits for the year. They promise to resume when the next legislative session begins in January. The current discussion is about increasing the state gas tax, with legislators debating items such as stormwater treatment, how to use the sales taxes collected from transportation projects, and funding for public transportation.

The need is urgent in Washington. Without any increase in state revenue, for example, the bus systems in the Seattle region are facing severe cuts in service that employers and employees depend on, along with fare increases.

A state we also hope will try again is Missouri, where a plan to raise $7.9 billion over 10 years through a penny sales tax passed both the Missouri House and Senate, but was then filibustered at the 11th hour when the Senate took up the package for a final vote. The fact that it was a sales tax was notable because in Missouri, as in many other states, while gas taxes are limited to only funding highway projects, a sales tax can be used for any mode of transportation, giving the state much more flexibility to invest.

Looking back

This movement we saw in 2013 is just the beginning. More and more states are increasingly looking for ways to bring more of their own dollars to the table, as well as making plans to invest in a range of transportation options. For a complete list see our state funding tracker.

The folks on the ground in these towns, cities, and metro areas know how important transportation is to their economic success. And keeping those local economies humming is key to our national economic prosperity.

Other states – and the federal government – need to take a page from their playbook and find a way to invest more money in transportation – it’s vital for our economy. One good place to start the discussion would be with our proposal to raise more revenue for transportation for the price of a weekly coffee and doughnut per commuter.

NPR: 19 states (and counting) creating plans to raise more transportation dollars

More than a third of all U.S. states have plans of some sort to raise new money for transportation to help cover yawning budget shortfalls and keep up with maintenance and new construction of their state transportation networks.

NPR picked up the story this week that we’ve been following very closely and spent some time talking to T4 America director James Corless about the growing trend of states stepping out on their own to raise their own money for transportation to augment the federal funding that did not increase with the last transportation bill.

One major reason federal transportation funding did not increase is that “cars are getting more efficient, and people are actually driving less,” James Corless told NPR. “So that has conspired really to put less revenues into these state and federal funds — trust funds out of the gasoline tax. So purchasing power is declining, and so states are getting creative,” he said.

Listen:

From the story:

According to figures released by Transportation for America, which advocates for modernizing the nation’s infrastructure, 19 states have approved or are considering legislation to increase transportation funding.

One creative approach was taken by Virginia, which actually eliminated its gas tax while raising sales taxes and imposing a tax on wholesale fuel. The state is also allowing the congested Northern Virginia and Hampton Roads areas to raise their own tax revenue.

Republican William Howell, the speaker of the Virginia House, helped broker the deal. “It was a true compromise,” he says. “As with most any compromise, no one’s 100 percent happy with every feature of it. There are some things that I’m not crazy about. I’m sure there’s some features that other people don’t relish. But we had to do it.”

Though a third of all states do have some sort of proposal in the works, they’re all certainly not created equal. Ohio is looking to borrow more than a billion dollars against future turnpike revenues to build yet more roads. Gov. Walker in Wisconsin wants to borrow $1.2 billion and repay it with dwindling trust fund dollars and general tax revenue. A bill in Indiana would allow Indianpolis counties to tax themselves and invest that money in transit. Massachusetts has a plan to raise as much as a billion dollars a year for multimodal needs, including budget relief for their amazingly indebted transit agency.

Want to learn more and see what your state is planning, if anything?

Visit our home for state plans here.

Tracking state transportation funding plans

Maryland State Route 200 CC Flickr photo by Dougtone With MAP-21 signed into law last summer, attention has shifted from Washington out to the states.

In many cases, states have looked at the bottom line in MAP-21 and are deciding that they need more money for transportation and are embarking on ambitious and often groundbreaking plans to raise additional revenues for transportation.

Visit the home for state plans here, where we’re tracking all of the proposed (and enacted) plans in one easy, simple chart. If you see something we’ve gotten wrong or a state we should add, drop us a line and let us know.

And don’t miss our series of posts examining the plans and debates in a few key states.

Ambitious Maryland plan moves forward to index gas tax, add sales tax for transportation

When Maryland’s Intercounty Connector (ICC) highway opened in 2011, it did more than create a new east-west toll road between I-270 and I-95 in the northern suburbs of Washington, DC: It also severely hampered Maryland’s ability to build other large-scale transportation projects for years to come. But now there’s significant momentum to raise new state revenues for transportation to ensure that the state won’t have to shelve their plans for a 21st century transportation system.

Update 4/3/12: The Senate passed the House bill (HB515) last Friday, heading to Gov. O’Malley for his signature. The separate “lockbox” bill will require a conference to reconcile the differences in House and Senate versions.

With MAP-21 out the door, attention has shifted from Washington to the states. In many cases, states are deciding that they need more money for transportation and are embarking on ambitious and often groundbreaking plans to raise additional revenues for transportation. This post is part of a longer series we’ll be doing in 2013 examining how states are addressing the need for more transportation dollars, along with key policy changes. Visit the home for state plans here, where we’re tracking all of the news. – Ed.

While half of the ICC’s almost $2.6 billion cost was paid for with future tolls that don’t really impact the state’s transportation budget year to year, the other half ($1.3 billion) was covered by sources that have huge impacts on Maryland’s ability to build any other significant large transit or road projects.

The state spent $265 million in general funds and though the $180 million from the state’s Transportation Trust Fund represents only about 10 percent of what the state gas tax and vehicle fees bring in each year, Maryland is also devoting $750 million in future federal funds they haven’t yet received to the project — or almost 130 percent of what the state receives from the feds each year for all of their state highway needs. ($580 million in FY12.)

That means that a large share of Maryland’s future federal transportation dollars under MAP-21 — which itself represents a loss in real dollars over previous transportation bills — are already spoken for by this mammoth project.

The ICC under construction in 2011, Creative Commons Flickr photo by Dougtone.

Even without building the ICC, like a lot of states, Maryland would certainly have to make some tough decisions. But with it, it’s easy to understand how state and independent analysts have been saying that by 2018, Maryland will only have enough money to cover maintenance and repair, making it nearly impossible to fund any new highway projects or any of the long-awaited and much needed public transportation projects, including the new Red Line subway in Baltimore, the Purple Line rail link for Metro and the innovative Corridor Cities Transitway rapid bus line in the DC region.

Get Maryland Moving, a new coalition of advocates of all stripes from across the state, coalesced around the urgent need to keep these worthy projects (and many others) from being relegated to a perpetual “wouldn’t that be nice” wish list, providing Marylanders with other options for getting around, and ensuring that Maryland doesn’t have to cease all investment in their transportation network.

Since the (state) gas tax was set at its current level of 23.5¢ in 1992, construction costs have doubled, according to this report from the CA DOT. Simply put, just like the federal gas tax that was last increased in 1993, inflation has far outpaced the value of the gas tax, and with Americans driving fewer and fewer miles each year in more fuel efficient vehicles, they each bring in less revenue.

A rally in Annapolis at the State House organized by Get Maryland Moving in March 2013.

Urged along by the diverse Get Maryland Moving coalition, the current proposal started from a plan put forward by Governor Martin O’Malley, the President of the Senate and the Speaker of the House, though it has been modified as it has moved through the state legislature. The House passed the bill (HB1515) just last week, and the Senate is due to debate and vote on it soon.

You can view the Governor’s initial plan on our page of state transportation funding plans, but here is the deal as it currently stands in the Maryland legislature. The plan would:

Index the gas tax to inflation starting immediately (with a ceiling of 5 cents maximum increase in any given year.)
Add a three percent sales tax at the gasoline pump, phasing that in over a period of three years starting this summer.
There are other provisions that could change the sales tax rate on gasoline that have to do with internet sales tax. In short, if Congress allows states to tax internet sales, Maryland will devote that revenue to transportation. If not, they’ll raise the sales tax on gas to five percent.-=
Raise $4.4 billion for transportation over six years (including the ability to borrow against increased future revenues.)

A popular argument against the tax has been the supposed increase that residents will see at the pump — 13-20 cents per gallon as reported by state analysts and trumpeted loudly above the fold by the Washington Post and other outlets. But gas prices fluctuate wildly even within submarkets — many places may see gas prices go up by 20 cents a gallon in just a few weeks at certain times of year.

Along those lines, the Get Maryland Moving coalition visited a bunch of Maryland gas stations on one particular day to show the wild variety in prices, sometimes at locations within sight of one another, and produced this terrific graphic.

The Get Maryland Moving coalition consists of some of T4 America’s core local partners in the region as well as strong representation from local elected officials and business groups that don’t want to see Maryland drop the ball on projects like the Purple Line that would create a vital (and decades overdue, many would argue) east-west transit connection in the region that would also eliminate long rides through the core of the Metro system to reach the opposite end of the Red line.

Most of the leaders of the suburban counties in the DC metro region have been strong advocates for the plan in the legislature. From The Washington Post:

“This is a big problem, and we need a big solution,” Montgomery County Executive Isiah Leggett (D) testified at a hearing of the Senate Budget and Taxation Committee. “My view is go big or go home.”

Leggett appeared on the same panel with Prince George’s County Executive Rushern L. Baker III (D) and Baltimore Mayor Stephanie Rawlings-Blake (D). All three praised a bill introduced by Senate President Thomas V. Mike Miller Jr. (D-Calvert) but said they remain open to alternative methods to raise more money for transportation.

The moment of truth is coming soon for Maryland’s transportation future. The 90-day legislative session ends in just a few weeks in early April.

A state with one of the oldest transportation systems tries to make things new — new state series

It’s a state that boasts the first active subway line and a network of turnpikes that predated the Interstates, so it shouldn’t surprise you that Massachusetts has some of the oldest infrastructure in the country.

Though Massachusetts’ bridges are middle of the pack in deficiency nationally, they’re beyond middle age (an average of 56-plus years) and many of its busy subways, bus lines and commuter trains – and the roads, bridges and tunnels that carry them — are starting to fall apart after decades of heavy use. Saddled with debt from the Big Dig (among other things) and chronically underfunded after years of budget cuts, Massachusetts leaders and advocates are trying to reform their transportation agencies while raising new money to bring an aging system into the 21st century.

With MAP-21 out the door, attention has shifted from Washington to the states. In many cases, states are deciding that they need more money for transportation and are embarking on ambitious and often groundbreaking plans to raise additional revenues for transportation. This post is part of a longer series we’ll be doing in 2013 looking at how states are addressing the need for more transportation dollars, along with key policy changes. Visit the home for state plans here, where we’re tracking all of the news. – Ed.

These aging systems in Massachusetts combined with years of lacking the needed money for maintenance has left things in perilous shape and makes for unreliable service on the roads and rails— along with unsustainable levels of debt that force MassDOT to use their capital funds (intended for construction, expansion, new trains, etc.) just to keep the system operating day-to-day.

Here’s one crazy fact for you: 100% of MBTA (The “T”) fare revenues go to paying down debt, because Big Dig-related debt largely ended up on the MBTA books.

While a significant 2009 reform merged the Bay State’s myriad of transportation agencies into one MassDOT, the revenue question was left unanswered. Reform did indeed result in some savings, however the funding gap identified by numerous Blue Ribbon Commissions and nonpartisan think tanks has remained and indeed expanded in the past four years.

A big source of the problem is that thanks to generations of budget cuts, a painful recession at a terrible time and rising expenses (like healthcare), the state has been paying for everything with bonds and other non-sustainable sources (read: debt.) A couple of winters of failing commuter trains, unreliable bus lines and overcrowded subway cars has helped convinced the public that the system is falling apart.

The state recently tallied up — confirmed by other independent sources — that they need about an extra $1 billion a year to bring the system into a state of good repair, fully fund operations and address some critical “expansion” projects.

But enough about the past, what’s the plan going forward?

Paraphrasing our partners at the T4 Massachusetts coalition, how will Massachusetts raise enough money from sustainable sources to fully fund the systems’ operations and invest in its future, spent in a transparent manner that helps increase access to transportation choices across the whole state, supports the economy and reduces greenhouse gas emissions from the transportation sector?

Gov. Deval Patrick introduced a plan that addresses some of the issues through dedicated sales tax revenue with some very progressive elements. His plan would:

Lower the sales tax rate from 6.25% to 4.5%, but deposit it all to an infrastructure fund for multiple things, including transportation. This alone will reduce revenues by $1.1 billion, but…
Index the gas tax to inflation to bring in an additional $13 million in 2014, and up to $118 million more by 2021. (The state gas tax hasn’t been raised since 1991 and was never adjusted for inflation, so it’s actually at its lowest level since the introduction of the tax.)
Increase vehicle fees by 10% every five years beginning in FY16
Increase tolls by 5% every two years beginning in FY15
Raise state income tax from 5.25% to 6.25% with changes to exemptions to raise $2.8 billion.
Increase MBTA transit fares 5% every two years.
Unlike some other states, the new money raised is expressly intended for multimodal projects. There’s no restriction on spending money on transit.

There’s a statewide pilot program for a vehicle-miles-traveled tax, a proposal to pay down Big Dig debt with other funds (freeing up transit money for, you know, transit), and the Transportation Investment Act, which would help guide how money gets spent in the state. This act, supported by a broad cross section of business, community and environmental groups and backed by the T4MA coalition, would send money to Regional Transit Agencies across the state, invest in low income communities, and enable DOT to comply with the states’ other obligations, like their “mode shift” plan to triple the share of travel in Massachusetts by bicycling, transit and walking. (Read Streestblog for more on that.)

The ball is currently in the Legislature’s court, but the clock is ticking.

A plan must be approved in time for the MBTA’s budget submission deadline around the corner in April or there will definitely be more fare hikes to keep the MBTA operating. The impact of that could be disastrous for lower-income commuters who depend on the “T”, a system that’s already experienced drastic fare hikes over the last 7-8 years.

Rethinking the gas tax: Suddenly it’s the theme of 2013

Is the per-gallon gas tax going the way of the full-service filling station?

To look at the flurry of proposals coming out lately, you might think so. Since the start of the year, major new proposals from industry leaders, governors and state legislatures have sparked a new debate over the ways we collect revenue collection for transportation — at the federal, state and local levels.

Earlier this month, the outgoing head of the American Association of State Highway and Transportation Officials, John Horsley, proposed replacing the per-gallon federal tax with a sales tax on fuel. Although he didn’t specify a level, an AASHTO press release indicated it should be set “at a level that restores solvency” to the transportation trust fund, meaning it would have to take in at least $15 billion more a year just to keep spending at current levels. While some no doubt will deride it as a stealth tax increase, Horsley said, “The cost of the reform to taxpayers would be less than $1 per week, per vehicle.”

At the same time, 2013 already has seen several ambitious proposals for funding transportation outside of the excise tax on gas. Massachusetts Gov. Deval Patrick in his state of the state address proposed raising his state’s income tax rate from 5.25 to 6.25 percent and lowering the sales tax from 6.25 percent to 4.5 percent, while earmarking sales tax revenue for infrastructure, with a significant share dedicated to public transportation. Patrick said those moves would raise $1.02 billion in new revenue per year on average for the next ten years – none of it from a per-gallon gas tax.

Last week came a report from Pennsylvania that Republican Gov. Tom Corbett is preparing to a release plan to add nearly $2 billion to the state’s transportation funding pot. Though the details are speculative pending a public unveiling next week, he has pledged that the money won’t come from an increase at the gas pump.

These proposals come on the heels of the month’s most controversial, headline-grabbing pitch from Virginia Gov. Bob McDonnell to scrap his state’s gas tax altogether. Instead, he would raise the state’s sales tax from 5 to 5.8 percent – ironically on everything but gasoline – while increasing vehicle-registration fees and adds an annual $100 charge for drivers of alternative-fuel cars. Those changes would raise an extra $3.1 billion over five years, he said.

At bottom, the recent move away from gas taxes as the go-to source of transportation funds is a nod to new realities: Their earning power is shrinking every year, and car-dependent voters will not stomach increases commensurate with their desire for a robust transportation network.

At the same time, both the highway lobby and environmentalists are seeing their long-held arguments undermined by experience. Environmentalists have contended that gas taxes should rise to slow consumption and speed the transition away from oil. The political reality is that gas taxes can’t be imposed in the U.S. in a way that changes behavior. Behavior now is changing, but for other reasons.

The highway lobby has spent years and millions making the case that gas taxes are “user fees” and are rightly devoted to roads. But with experts like DOT Secretary Ray LaHood predicting that nearly every vehicle will be a hybrid or electric a decade from now, most motorists will be paying little or no such “user fee” absent a major change.

That, of course, says nothing about meeting the needs of the vast majority of Americans who will be living in metro regions too crowded for one-person-per-car travel. State gas taxes certainly can’t meet those needs: 22 states have a constitutional prohibition against spending gas tax revenue on anything but roads, and eight states have similar statutory restrictions.

The reality today, though, is that gas taxes only cover half of the bill for building and maintaining our road network, and that ratio is dropping every year. At the local level, of course, nearly all road and transit costs are paid by sales, property or other non-fuel taxes.

While moving away from the gas taxes, all of the recent proposals — coming from Republicans in VA and PA or Democrats in MA, MN and MD – would amount to asking citizens to pay more for transportation infrastructure. That is something that polls show voters increasingly are willing to do when they understand what the money will be used for.

As we have said since the rollout of our “Blueprint” in 2009, we believe all options to increase funding for reinvesting in America’s infrastructure should be on the table. Back then, T4 proposed a variety of options including a 20 cent increase in the gas tax, converting the federal gas tax to a sales tax, or imposing a per-barrel fee on imported oil.

The gasoline tax has its merits, but given the lack of political will to raise it significantly, and the wide range of needs, it’s time to begin thinking of infrastructure as a basic government function that can, and should be, funded the full range of available revenue sources. Our global competitors, after all, have recognized this for quite some time, and are moving ahead of us in building a 21^st century infrastructure.