Pennsylvania Senate-Passed Transportation Bill Faces Uncertain Future in the House
A coalition of rural conservative and urban liberal Senators was credited with making possible this week’s 45 to 5 vote in favor of a $2.5 billion transportation bill in Pennsylvania that supporters say would protect the safety of motorists and provide a much needed economic boost in the Keystone State. I also have some bonus updates for the week on some of the topics covered in my previous post from earlier this week including public-private partnerships and the condition of the nation’s bridges.
Pennsylvania Senate’s Transportation Bill
The state Senate Wednesday approved the transportation bill I mentioned in my last blog post that would provide $1.4 billion for road and bridge repairs and construction in 2013-14 and that would eventually generate $2.5 billion a year in total transportation funding. It would increase state spending on transportation by almost 50 percent and make the state’s fuel tax rate one of the highest in the nation.
But, the Associated Press reported, the bill faces an uncertain future in the House, where Republicans are concerned that the bill’s tax, fee and fine increases are too high. They also say the legislation does not deal with the Pennsylvania Turnpike Commission’s rising debt.
In urging his colleagues to vote yes on the measure, Senate Transportation Committee Chairman John Rafferty appealed to them on the basis that transportation is a core function of government: “The worst thing we could do in Pennsylvania is do nothing. Then you’re going to see more bridges close, more bridges weight-restricted. We’re going to start losing more businesses.”
Supporters say when fully implemented, the legislation could create 60,000 to 70,000 jobs and help stimulate the economy.
Gov. Tom Corbett wants to see House action on the bill before July 1, when lawmakers begin their summer break. The legislation retains Corbett’s proposal for lifting the cap on the oil company franchise tax but it phases in the increase over three years as opposed to the five he proposed, according to The Meadville Tribune. That could mean a 25 to 28 cent-a-gallon increase in the price of gas for consumers. At the same time, the 12 cents-per-gallon flat gas tax would be temporarily reduced to 11 cents in 2013-14 and 10 cents in 2014-15. The bill also adds surcharges on speeding tickets and other moving violations and increases vehicle registration and driver’s license fees.
Public-Private Partnerships & Infrastructure
- Former Puerto Rico Gov. Luis Fortuno, who served as the 2012 CSG National President, touts the role public-private partnerships can play in infrastructure investment in an opinion piece for ABC News.com this week. He said Puerto Rico’s experience with P3s offered several important takeaways: “Successful P3 projects may include ports, airports, roads, bridges, schools, penitentiaries, and other basic infrastructure facilities. A dedicated government entity must be created to protect the public interest and monitor progress towards the project's benchmarks. It must also offer the private investor the opportunity to engage with the government at a single point of contact to minimize bureaucratic rigmarole. The P3 entity must be staffed correctly. Its officials and consultants must have the necessary expertise and entrepreneurial disposition to manage complex investment and infrastructure projects. Transparency is essential in any P3 project. In Puerto Rico, we published the relevant documents on the Internet throughout each phase of every project. The entity must be insulated from the vagaries of shifting political winds to remain focused on its objectives. The entity's ability to avoid being swayed by extraneous considerations turns on its officials being confident that they have the support of the elected officials.” Fortuno’s successor, Gov. Alejandro Garcia Padilla earlier this year approved turning over the operations of Puerto Rico’s largest airport to a private company as part of an estimated $2.6 billion deal forged during Fortuno’s administration.
- The potential for future airport privatization deals will be among the hot topics later this month at the InfraAmericas U.S. P3 Infrastructure Forum in New York City. Federal Aviation Administration Director Randall Fiertz will be among the panelists at a session entitled “Airport Sector Focus – How Could a Domestic P3 Airport Market Be Developed in the U.S.?” As part of the FAA reauthorization bill last year, the agency increased the number of airports that can participate in its Airport Privatization Plan from five to ten.
- According to organizers of the 9th annual InfraAmericas forum, more than 500 people are now confirmed to attend this year’s event at the Crowne Plaza Hotel in New York’s Times Square on June 18th-19th. While space is running out, there may still be time for you to register to attend. Check out the InfraAmericas website for more information. CSG is a supporting organization for the forum, which brings federal, state and local transportation officials together with P3 industry executives from the private sector. You can read my preview of this year’s meeting in a recent Capitol Ideas E-Newsletter and read my coverage of last year’s conference here in the Knowledge Center.
- The I-5 bridge collapse in Washington State will be the subject of a Senate Appropriations Subcommittee hearing next week. Senators will hear from FHWA Administration Victor Mendez and U.S. DOT Undersecretary for Policy Polly Trottenberg as they attempt to examine the incident in the context of the nation’s overall infrastructure needs. The subcommittee is chaired by Sen. Patty Murray of Washington.
- Nearly 40 percent of the bridges in North Carolina are substandard and six of the worst bridges in South Carolina are on the well-traveled Interstate 26 between Columbia and Charleston. Those are two of the findings in a report released this week by AAA Carolinas, according to reports in the Charlotte Observer and GSA Business Journal.
- The Washington Post’s Ezra Klein makes the case in a recent blog post that “Now is the time to be an infrastructure hawk, not a deficit hawk.” “The thing we’d typically worry about with high deficits? It’s not happening,” he writes. “It’s not close to happening. Interest rates aren’t high. They’re ridiculously, comically, insanely low. But in the coming years, they’ll rise again. So that’s one reason we should do infrastructure now rather than later: If we do it later, it will cost us more, as interest rates will have risen. We’ll have missed the big sale. The other big thing is that unemployment in the construction sector remains wracked by unemployment. There are construction workers who need work right now. Putting them to work today would be a huge boon to the economy in a way it won’t be in, say, 10 years, when they’ll (hopefully) have work.”
- Politico’s Adam Snider has a rundown this week of the pros and cons of four of the most talked-about ways Congress could raise more revenues for infrastructure in the next federal authorization bill. They include: raising the gas tax, charging drivers based on how much they drive, tapping oil and natural gas drilling royalties and transferring more money from the general fund.
- Planetizen highlighted Kentucky’s 10-year-old mechanism for indexing its gasoline excise tax to inflation as one way to avoid costly political battles over gas tax increases. The indexing is based on a survey of gas prices performed the first month of each quarter by the Kentucky Department of Revenue and is one of three components of the state gas tax, which includes: a fixed five-cents-a-gallon, a 1.4 cents-per-gallon fee for cleaning up underground fuel storage tanks, plus a variable component set at 9 percent of the average wholesale price. The state has a 10 percent cap on the amount that the wholesale price can increase annually. The (Louisville) Courier-Journal has more on Kentucky’s gas tax.