Transportation Policy Experts Discuss Funding Outlook for States

During a recent CSG eCademy webcast, “States to Watch in 2016: Transportation Funding,” transportation policy experts made some predictions about upcoming transportation funding issues, and possible solutions, in the states.

Joe McAndrew, policy director at Transportation for America, said 23 states have approved plans to raise transportation revenue since 2012. In 2015, eight states passed gas tax increases while other states considered tolling changes and other revenue options.

But, according to McAndrew and other presenters, 2016 could be a slow year for major transportation funding initiatives.

“I think that that’s a culmination of a few different things,” McAndrew said. “But, really, it’s an election year, a lot of folks are not going to be passing big, transformative tax increases.”

Christopher Keating, Capitol Bureau chief at the Hartford Courant, said he does not expect action on major transportation funding issues in Connecticut—where the governor has proposed a 30-year, $100 billion transportation overhaul—before the 2016 elections. The plan would likely be paid for using a combination of tolls, taxes and bonding if it moves forward, Keating said.

McAndrew said some states might respond “in a targeted way to address specific programs coming out of the Fast Act.” In December, President Barack Obama signed the Fixing America’s Surface Transportation Act, which provides long-term funding for transportation infrastructure such as highways, bridges and transit lines.

Contrary to some beliefs, supporting transportation funding does not hurt political careers, McAndrew said. For the last several years, nearly all the policymakers who voted for transportation funding packages at the state level won their next primary for re-election, according to Transportation for America studies.

“I think this is an important thing to note—to recognize that the electorate will go ahead and support you if you take the tough votes that are needed to invest in our transportation system,” McAndrew said.

Alison Premo Black, senior vice president and chief economist of the American Road and Transportation Builders Association, listed seven states— Alabama, California, Indiana, Minnesota, Missouri, New Jersey and South Carolina—that are likely to see funding legislation in 2016.

“Missouri has indicated that they are concerned about having enough to match federal funds, and that’s usually a big driver of some sort of investment increase,” Black said. “So we expect something, possibly, to happen there. Same thing in Minnesota, not sure that we’re looking at a gas tax increase in Minnesota, but there is support for some sort of increase in investment of a reoccurring nature.”

In New Jersey, a Transportation Trust Fund crisis means “they absolutely have to do something by July 1 to address that issue,” she said. In South Carolina, there have been attempts for revenue increases and a future compromise could prove fruitful in 2016.

“In 2017, we can look for something in Tennessee, Oregon and Montana—three states that said they’re looking at issues but probably not for this year,” Black said.

Several states are considering tolling changes, said Keith Goble, state legislative editor at Land Linemagazine. The trucking industry, however, opposes tolls that target truck drivers because truck drivers already pay some taxes and fees that other motorists do not pay.

“Truck groups point out that truckers already foot part of the bill to travel through states,” Goble said. “They say that, quite simply, any assertion that they do not pay their fair share is uninformed.”

Several competing transportation funding proposals—including a multimillion-dollar bond package, a gas tax increase and a sales tax increase—are being reviewed in Colorado, said John Frank, a political reporter at The Denver Post.  

“Right now, we’re at the crunch time,” Frank said. “We’re about a third or more through our legislative session here, and we have not seen any of these measures introduced as bills. So, as the days go on, we’ll look more and more for outside efforts to drive this transportation funding question.”

Geoff Pender, political editor at The Clarion-Ledger, said the Chamber of Commerce in Mississippi has suggested some sort of tax increase to provide at least $375 million for transportation-related maintenance.

“We’re kind of in the same boat as a lot of others except probably a little worse given our state being a poor state and a rural state,” Pender said. “So, we’re trying to figure that out.”

In Tennessee, however, the governor has proposed taking $130 million out of the general fund, where there is a surplus, and putting that money into the road fund, said Tom Humphrey, the retired Nashville bureau chief at the Knoxville News Sentinel.

“We have a $750 million revenue surplus. Saying we need a tax increase with that as a backdrop is problematic,” he said.