Changing Face of Transportation Revenues

2013 has seen a burst of activity on the transportation funding front. From gas tax increases to tax swaps, from general fund transfers to tolling and public-private partnerships and from mileage-based user fees to taxing electric vehicles, the strategies have been varied and the trends sometimes contradictory. In a series of June 2013 interviews, six transportation experts weighed in on the reasons behind the burst of activity, the states they believe were the most significant stories, what the various strategies mean for the future of transportation and the factors they believe are necessary for states to be successful in seeking new transportation funding. 

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State legislatures have been busy on the transportation revenue front in 2013. About 30 states considered some kind of transportation investment package this year. Of those, five states—Maryland, Massachusetts, Vermont, Virginia and Wyoming—passed significant packages that, to one degree or another, shook up the way transportation has been funded in those states, in some cases for decades.

Texas forwarded a measure to voters that, if approved in November 2014, could divert revenues from a reserve account to increase transportation funding by $1.2 billion, a short-term, voter-dependent solution that doesn’t come close to meeting the state’s $4 billion annual transportation needs. Oregon produced legislation that could have a significant long-term impact for transportation not only in the Beaver State, but also nationwide. Seven other states—Michigan, Minnesota, Missouri, New Hampshire, Pennsylvania, Washington and Wisconsin—also debated significant transportation revenue measures in 2013 but have been unsuccessful—at least thus far—in getting anything across the finish line. A handful of those states could still have a chance to produce something before the clock runs out on 2013.
 
Transportation experts point to a variety of reasons for the unusually high level of activity this year: a stagnant federal program and a declining revenue source—the gas tax—among them. While some states—Vermont and Wyoming—opted for straightforward, tried-and-true solutions such as simply raising the gas tax, others—Maryland and Virginia—opted for more complex solutions that draw on multiple strategies and tools. It would seem that for every trend in transportation funding, there was a counter-trend this year. Success was often hard won and long in coming. Many transportation advocates have discovered patience pays off. But leadership is required, experts say, to both push for investment and to help educate the public on what that investment can bring. 
 
In a series of June 2013 interviews, six transportation experts from around the country weighed in on the reasons for this year’s burst of legislative activity, the states they believe were the most significant stories and what it takes for a state to have success on the transportation revenue front. They also discussed the various trends in transportation funding and finance this year from gas tax increases to tax swaps, from general fund transfers to tolling and public-private partnerships and from mileage-based user fees to taxing electric vehicles. The group of experts included: 
  • Joung Lee, associate director for Finance and Business Development at the American Association of State Highway and Transportation Officials, known as AASHTO, in Washington, D.C.;
  • Lee Munnich, director of the State and Local Policy Program at the University of Minnesota’s Humphrey School of Public Affairs;
  • Martin Pietrucha, Ph.D., professor of civil engineering at Penn State University;
  • Martin Wachs, Ph.D., distinguished professor emeritus of urban planning at UCLA;
  • Gian-Claudia Sciara, Ph.D., postdoctoral scholar at the Urban Land Use and Transportation Center at the University of California Davis; and
  • Asha Weinstein Agrawal, Ph.D., director of the Mineta Transportation Institute’s National Transportation Finance Center at San Jose State University.

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Changing Face of Transportation Revenues

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