transportation funding Archives - Page 3 of 3

Texas looks to voters to ensure billions for highway funding

Facing a population and economic boom sufficient to give Texas seven out of the top 15 fastest growing cities, state legislators are looking to voters to direct more revenue to build more highways, but without raising new fees or taxes.

Credit: Lotus Carroll on Flickr

Texas has responded to the boom by building toll roads, wider highways, and some mass transit options in a few cities, but the state DOT and many state legislators feel that Texas isn’t building what they need to serve the 1,500 new residents moving there everyday — and they’re on the lookout for more money.

Texas currently has what they call a “rainy day” fund replenished with revenue generated from gas and oil drilling taxes and fees. The fund has been used in the past to help fill budget gaps and avoid budget cuts during economic slumps.

The legislature has placed a measure on this November’s ballot (Proposition 1) amending the state constitution to divert half of these funds for the next ten years to a State Highway Fund, to be used exclusively for highway construction, repair, and maintenance. This fund could not be used for toll roads.

Texas’ gas tax is currently set at 20 cents per gallon and was last raised in 1991. The coalition urging its passage says that Proposition 1 will raise an estimated $1.7 billion within the first year.

Both Republican gubernatorial candidate Greg Abbott and his Democratic opponent Wendy Davis are supporting the measure while campaigning for office. Organized support comes from Move Texas Forward, Texas Future, Transportation Advocates of Texas, and a broad range of trade associations, chambers of commerce, and other advocacy groups across the state.

Directing a portion of money generated by the very thing driving Texas’ economic boom right now (oil and gas) into the transportation network seems rational. However, it would be even smarter to leave those dollars flexible enough to address pressing needs in the transportation network wherever they arise, not just on the highway system. With several large and growing metropolitan areas, the state is going to need to invest in trains, bus lines, freight projects, passenger rail to connect cities, and local street networks as well.

The Houston Chronicle describes opposition to the proposal as “token and largely unorganized.” President of the Houston Property Rights Association, Barry Klein, hoped for a defeat so it “would force transportation official to confront their spending demands, possibly leaving the state better off when it comes to prioritizing projects.”

For more on important ballot measures to watch this Nov. 4, visit our Transportation Vote 2014 page.

To better serve the states and localities stepping up to try and raise revenue to invest wisely in transportation, we are hosting the Capital Ideas Conference in Denver, Colorado on November 13-14 shortly after this year’s election. If you’ve been working on a transportation measure as part of a funding campaign, working to overcome a legislative impasse, or defending a key legislative win, this conference will offer a detailed, interactive curriculum of best practices, campaign tactics, innovative policies, and peer-to-peer collaboration to help your initiative succeed.

After spurning it for decades, suburban Atlanta county seems poised to join regional transit system

In many states local jurisdictions have to get permission from their state legislature to raise local funds for transportation. One of the most notable examples of this will be taking place in a county in the heart of metro Atlanta, Georgia.

Click for more stories and information about a few key issues that will be decided on November 4

From the day when Clayton County, one of metro Atlanta’s core five counties, had to cancel their bus transit service outright in 2010, local leaders have been trying to figure out how to bring back transit service back and better connect their residents with jobs and opportunities.

In a county with a large population of low-wage workers, residents and employers alike are hungry for an affordable and reliable way to get around and get to work. C-Tran, the former county-run bus service, provided more than 2 million rides each year, helping residents get to jobs — especially the thousands of jobs in or near bustling Hartsfield-Jackson International Airport in the north end of the county.

Read a short story of how shutting down the system affected one Clayton resident. From the Atlanta Journal-Constitution.

Click to open

It was a huge blow to the residents of Clayton County when county commissioners shut the service down in 2010 in the face of a recession-fueled budget crisis. Federal start-up funds and support from the Georgia Regional Transportation Authority had kept the service going since the early 2000s, but with that funding drying up the county faced a deficit that was too much to overcome.

Clayton County voters will decide a one-percent sales tax on Nov. 4 that will bring them into the MARTA system and bring bus service into the county. Flickr photo by James Williamor.

On Nov. 4, Clayton County voters will decide on a measure to increase the local sales tax by a percent to join MARTA, the regional transit system. Doing so would restore bus service and jumpstart planning for bus rapid transit or a rail extension in the years to come. As county commissioners debated whether or not to put the question on the ballot, they heard hefty support from residents, who turned out to meetings to urge commissioners to make a vote happen. And most of the commissioners saw the need. From a piece by Next City, published just yesterday:

At a packed board of commissioners meeting on July 1st, former State Rep. Roberta Abdul Salaam described what this looked like for formerly bus-dependent residents.

“I have people, students, young men that can’t take jobs for the summer because we don’t have transportation for them,” she said. “And someone said earlier don’t make it emotional — well let me just apologize now. I get emotional when I see little old women walking down Tara Boulevard in the ditch in the rain, and there’s not even anywhere to pull over and pick her up.”

Yet voters in Clayton County, or anywhere else, can only have this opportunity if the state they live in has authorized local communities to raise revenues through ballot measures.

“Enabling” legislation

State enabling laws must be in place before local ballot measures can even be considered — they either have to be on the books already, or passed ahead of a specific measure (as happened in Clayton’s case). These laws can govern many aspects of local ballot measures, including the type and duration of the levy, the process for getting a measure on the ballot, the permissible uses for the revenue, and sometimes even the exact language that must be presented to the voters.

A handful of bills were passed recently enabling local governments to raise local revenues for transportation in MN, PA, IN, NV, and CA and bills were considered in AL, MD, MI, SC, SD, UT, VA and WA during the 2013-2014 sessions. We recently covered a notable example in Indiana, where a law was passed just this year allowing Indianapolis to finally raise local funding to invest in their ambitious regional IndyConnect plan.

To make this vote possible for Clayton County, the Georgia General Assembly had to pass a pair of laws to “enable” Clayton to take the measure to the ballot, and they did so in 2013, with some specific restrictions.

Interestingly, state law already provided for Clayton to be a part of MARTA, and as one of the five core counties included in the 1970’s charter actually had a vote on the MARTA board. But Clayton and two other counties declined to pass the sales tax, and only the City of Atlanta, Dekalb and Fulton counties ponied up. In the meantime, Clayton had used it’s available sales tax percentage — state law caps it — for other purposes. That meant that the state had to waive that cap specifically for Clayton so they could decide on the MARTA tax. (A second piece of legislation was required to restructure the MARTA board to give Clayton County two representatives on the board starting next year.)

The legislation specified that the vote be restricted to raising revenue to join MARTA, rather than contracting for service as in the past, and the county had to take action this year.

Read this short primer on enabling legislation from our “Measuring Up” package of resources geared around state transportation funding.

Measuring Up

All state enabling laws are not created equal. A great counter-example is the one provided by the same Georgia assembly just a few years earlier. After no fewer than three tries before the state legislature, the state finally gave all Georgia metropolitan regions the power to pass regional transportation sales taxes. But that also came with a mandated two-year political process to develop a project list that swelled to 157 highway and transit projects for Atlanta in the end.

That 2012 referendum to raise $7.2 billion to invest in regional transportation needs failed in metro Atlanta for a lot of reasons, but as we opined at the time, the way the enabling law was written by the legislature may have contributed to its demise.

“Many voters also complained of a sense that the project list was a goodie bag for various political interests and not a cohesive plan to address well-articulated needs. The Legislature-mandated process almost assured that outcome. It called for creating a 21-member “regional roundtable” made up of a mayor and county commissioner from each of the region’s ten counties, plus the mayor of Atlanta. While the “pro” campaign pitched the project list as a solution to congestion, the list struck many voters as a collection of pet local projects that did not necessarily add up to a thought-through plan.”

In the end, there was a lot of “include my project on the list and we’ll support yours” horse-trading amongst the representatives developing the project list that might have doomed the measure.

Clayton’s prospects on November 4

But Clayton voters face a simple question on November 4: raise local sales taxes by a percent to join MARTA, create new robust bus service into the county starting in March 2015, and save half of the revenues (locked away in escrow) for planning or building some higher capacity transit in the years to come. And one thing we know from experience with ballot measures is that the simpler the question and the more clear it is what the money is going to buy, the more likely voters are to support it.

It’s also worth looking back at how Clayton County voted on that aforementioned regional transportation tax from 2012 — one that did include restored local bus service for Clayton, but which wasn’t expected to begin service for at least two to four years after the vote. It also included a handful of road improvement projects and initial development of a long-awaited commuter rail line south toward Macon that would run through the county.

If you look at that graphic, where Clayton is highlighted near the bottom, the bulk of the county’s precincts supported it between a 42-66% clip, with a handful of precincts at numbers below that. On top of that, more than 7o percent of voters approved the concept of participation in a regional transit system in a nonbinding referendum on the ballot just a couple of years ago.

The local experts we talked to were all cautiously optimistic that it’s going to pass, and many local political analysts are suggesting that it could possibly win by a pretty significant margin. Of course, turnout will play a big role in what happens, as always. We’ll be watching closely on election night and reporting back here, so stay tuned.

Want to know more about enabling legislation? Need help doing what Clayton County had to do and getting your state to clear the way for a local revenue-raising measure? Join us in Denver in just a few weeks on Nov. 13-14 for Capital Ideas — the premier conference for state legislation related to new transportation revenue.

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.

Wyoming voters reward elected leaders for raising transportation revenue

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In February of 2013, Wyoming’s state legislature decided to stabilize their state’s transportation fund by passing a ten-cent increase to their gas tax, which is expected to raise an additional $72 million per year for state and local roads. On Tuesday, those elected leaders faced their first primary election since their vote to raise the gas tax by ten cents, which went into effect a few weeks ago on July 1st.

HB 69 passed the House by a vote of 35-24, with 30 Republicans and 5 Democrats voting in favor. In the Senate, the bill passed by a vote of 18-12, with 14 Republicans and 4 Democrats supporting the measure. (Wyoming has a relatively small state legislature with only ninety total members in the Senate and the House — compared to a state like New Hampshire, which has 409.)

Wyoming highway Flickr photo by remster_9

Of the 30 total House and Senate Republicans running for re-election this week that voted yes on the gas tax increase, just 15 were challenged by a primary contender. This may indicate that Wyomans by and large support the position and leadership that these leaders took on the state’s transportation funding. Only two of the 15 supportive Republicans facing a primary opponent lost their races: Dave Blevins (R-Park County) and Kathy Coleman (R-Sheridan County). All six supportive House and Senate Democrats running for re-election won their uncontested primaries.

Based on the primary results, 94.4% of all Wyoming legislators who supported the measure and are running for re-election have won support from their constituents in their primary elections.

It certainly didn’t hurt that the legislation also had Republican Governor Matt Mead’s full support and endorsement:

“Every part of Wyoming’s economy relies on an effective, well-maintained and continually improved highway system. Wyoming Department of Transportation’s projects are planned years into the future – good planning, reasonable costs and effective management can only be achieved through reliable, long term funding.”

Considering that long-term funding certainty is the last thing coming from Washington, D.C right now, this type of teamwork between the Governor and the state legislature helped provide Wyoming certainty for planning and investing in priority projects, including $35.5 million of much needed highway and bridge maintenance and repair throughout the state.

In an environment where Congress is unable to find a stable long-term funding solution for the nation’s Highway Trust Fund, more and more states are taking it upon themselves to fill the gaps and raise additional revenue to provide some stability and invest in much needed capital construction and maintenance projects.

Even though several recent polls seem to suggest that the American public is opposed to raising transportation related taxes, recent state primary election returns from Maryland, Virginia, Pennsylvania and now Wyoming tell a different story. In those states that approved a gas tax increase, at least 93% of the representatives backing a tax increase won their primary or kept their seat.

You can read our recent analyses on Maryland, Virginia, and Pennsylvania, here. Stay tuned for Massachusetts, Vermont and New Hampshire in the coming weeks.

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.

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.

Massive letter opposing House leadership attack on transit sent to Capitol Hill

As we mentioned yesterday, House Leadership and the Ways and Means Committee this week proposed an unprecedented attack on public transportation funding.

This morning we sent this letter (below) to the Ways and Means Committee and the entire House of Representatives in strong opposition to this House leadership plan to end a 30-year precedent of providing dedicated funding for public transportation from the federal fuel tax.

In less than 12 hours, we gathered signatures from more than 600 groups, notable individuals and elected officials. More than 75 national organizations — including the U.S. Chamber of Commerce, AARP, the American Public Transportation Association, the National Rural Assembly, American Society of Civil Engineers, LOCUS (real estate developers), National Association of Counties— and a huge list of other individuals and state & local groups, including the governors of Oregon and Washington, several state DOTs, state and local Chambers of Commerce, and hundreds of state and local organizations nationwide.

Read the full letter here, where you can see the full list of all groups that signed.

Although Ways and Means markup is about to begin this morning, ~~there’s still time to contact your House rep and let them know that you stand against this raid on transit funding~~.

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Dear Chairman Camp and Ranking Member Levin:

For the past thirty years, Congress has provided dedicated funding for highway and transit programs through an excise tax on gasoline dedicated to the Highway Trust Fund. This funding structure has successfully provided highway and transit programs with secure, dedicated revenues and budgetary firewalls dating back to the Reagan administration. The success of this approach is without question: The Trust Fund has been critical to our nation’s ability to build an efficient and multimodal transportation system. With record transit ridership, now is not the time to eliminate guaranteed funding for our nation’s public transportation systems, which saved Americans close to $19 billion in congestion costs in 2009. For the first time in thirty years, the pending legislation H.R. 3864, the American Energy and Infrastructure Jobs Financing Act, removes the certainty of a continued revenue source for our transit systems as well as the Congestion Mitigation and Air Quality Program.

Specifically, we are deeply concerned about the provision in H.R. 3864 that would terminate funding from the excise tax on gasoline and replace it with the Alternative Transportation Account. In place of gasoline tax revenues, the legislation would provide a one-time $40 billion transfer of General Fund revenues to the Alternative Transportation Account. Not only is this level of funding insufficient to fully fund the proposed authorized levels for the Alternative Transportation Account, but it would subject transit and CMAQ funding to the annual appropriations process. This change will make it impossible for public transit systems across the country to plan for the future. It will also make it impossible for the FTA to honor grant agreements.

In addition, this legislation does not make clear how the $40 billion in General Fund revenues will be offset in the U.S. budget. As a result of this funding gap, we are concerned that the $40 billion general revenue transfer may not occur leaving transit programs out in the cold.

We strongly encourage the Committee to reject H.R. 3864 and work to continue to fund highway and transit programs through dedicated funding.

Government shutdown averted in last-minute budget deal, with some cuts to transportation

Down-to-the-wire negotiations late last night between President Obama, House Speaker John Boehner and Senate Majority Leader Harry Reid resulted in a budget deal containing about $38 billion in reductions from current spending levels and the prevention of a government shutdown.

With the Federal Government slated to close at midnight, the House and Senate passed a final one week stop-gap measure to allow the details of the agreement to be ironed out. The continuing resolution itself contains $2 billion in cuts that largely hit the U.S. Department of Transportation and Department of Housing and Urban Development.

By next week, Congress is expected to finalize its fiscal year 2011 budget — which runs through September — at the agreed-upon funding levels. President Obama made brief remarks on the budget compromise at the White House shortly after 11pm last night.

The cuts to transportation and housing passed last night were deemed largely non-controversial because they matched closely with the funding levels requested in President Obama’s fiscal year 2012 budget.

The High Speed and Intercity Passenger Rail program will receive $1 billion, a reduction of $1.5 billion from the previous year, and the New Starts program — a key revenue source for transit projects throughout the country — loses $280 million, though the resulting figure is reportedly sufficient to fund projects that have already received grants from USDOT. Other cuts include:

$6.3 million from the Transportation Planning, Research, and Development account
$2.5 million from the Federal Railroad Administration’s Research and Development; and
The Transit Research and University Research Centers Program budget is reduced to $64.2 million.

Details on the remainder of the fiscal year cuts and how they will affect transportation are not yet available, although Politico has early information on a few items:

One of the toughest fights, casting the White House as the budget cutter against reluctant Republicans, was in highway and transportation spending. But here the administration succeeded in cutting about $630 million in so-called orphan earmarks and $2.5 billion in unexpended contract authority.

We expect to hear more about the final package soon.

UPDATE: A White House blog post confirms that the fiscal year 2011 cuts include $630 million in earmarked transportation projects and $2.5 billion in funding that was slated for transportation projects.

Photo courtesy of the Washington Post.

Compromise on two-week spending bill temporarily spares crucial transportation programs from deep cuts

The federal government will keep the lights on next week after the U.S. Senate easily approved the House’s two-week stopgap measure containing $4 billion in spending cuts. The vote was 91-9.

Although some in the press have characterized the development as a victory for Republicans, the $4 billion in reductions is decidedly modest and overlaps with programs already targeted in President Obama’s fiscal year 2012 budget. Only two budget items — $650 million from a one-time Federal Highway Administration program and a handful of legislative earmarks – are transportation related.

However, the measure to fund the government for two weeks received 85 Democratic “no” votes in the House — including Minority Leader Nancy Pelosi — and a chilled reception in the Senate even from those Democrats voting in favor. Unifying the more liberal-leaning Senate Democrats wary of deep cuts with moderates who are more open to them could be difficult. Some members were also alarmed by remarks from Speaker John Boehner that cutting “one slice at a time” could achieve his party’s goals if deep reductions were not passed in one package.

House Transportation and Infrastructure Committee Chairman John Mica was a yes vote, as was top committee Democrat Nick Rahall. Senate Environment and Public Works Committee Chairman Barbara Boxer and Republican counterpart Jim Inhofe also voted yes.

Though spared for the time being, crucial transportation programs like New Starts, high-speed rail and TIGER grants remain on the chopping block. So far, cuts to transportation have not received a lion’s share of the attention, though Senator Dick Durbin of Illinois highlighted his opposition to TIGER grant cuts at two events last month and several House members offered amendments to restore essential funding to public transportation.

This week’s compromise does not preclude a shutdown later this month, given the seemingly wide gulf between the two parties on what level of spending cuts are acceptable. Some Democrats said they fear the short two-week timeline will induce gridlock and result in Republicans re-offering their $61 billion spending reduction plan as an alternative.

President Obama: “I would like to see some long-term reforms in how transportation dollars flow…”

President Obama gave an interview to five columnists aboard Air Force One last week en route to Chicago, and he talked at length about infrastructure, transportation, and the need to make serious reforms in transportation spending this year when the five-year transportation bill is reauthorized. He hinted at how proper investments in transportation and infrastructure can help boost the economy and meet other national goals like reducing energy usage — all while making a downpayment on a 21st Century transportation system we’re all hoping for.

President Obama with his Transportation Secretary Ray LaHood. From the Obama-Biden Transition Project’s Flickr stream (Creative Commons)

An excerpt from the very long interview:

Q. Mr. President, if I could ask you about infrastructure, You’ve got infrastructure spending in the stimulus package. The need is much faster than that and the money is tight. Do you anticipate any significant further additions in federal infrastructure spending in the reasonably near future, and are you making plans to establish an infrastructure bank?

President Obama: Well, number one, we’ve got the transportation reauthorization bill that’s going to be coming up. So one thing to keep some perspective about on the recovery package is this is supposed to provide a jolt to the economy above and beyond what we’re doing already in the federal budget. And so I expect that Secretary LaHood, working with the various transportation committees are going to be moving forward on a transportation bill. I would like to see some long-term reforms in how transportation dollars flow, and I’ll give you just a couple of examples. I think right now we don’t do a lot of effective planning at the regional level when it comes to transportation. That’s hugely inefficient. Not only does it probably consume more money in terms of getting projects done, but it also ends up creating traffic patterns, for example, that are really hugely wasteful when it comes to energy use.

If we can start building in more incentives for more effective planning at the local level, that’s not just good transportation policy, it’s good energy policy. So we’ll be working with transportation committees to see if we can move in that direction.

The idea of an infrastructure bank I think make sense — the idea that we get engineers, and not just elected officials, involved in thinking about and planning how we’re spending these dollars. I may get some objections from my colleagues, Democrat and Republican, on the Hill about that, but I think there should be some way for us to — just think how can we rationalize the process to get the most bang for the buck, because the needs are massive and we can’t do everything, and if it’s estimated that just on infrastructure alone it would cost a couple trillion dollars to get our roads, bridges, sewer systems, et cetera, up to snuff, and we know we’re not going to have that money, then it would be nice if we said here are the 10 most important projects and let’s do those first, instead of maybe doing the 10 least important projects but the ones that have the most political pull.