TranspoAdvocate NewsState & Local Funding News
TIAC staff tracks the latest state and local transportation funding news and provides regular updates on TranspoAdvocates News. To contribute to these efforts, contact Carolyn Kramer.
The West Virginia Department of Transportation is preparing to grant an additional $30 million to overdue maintenance projects in the beginning of July, after the transportation funding increase in Senate Bill 1006 goes into effect. Read More>>
Three Verde Valley, Arizona, city and town managers stated that diversions on the state’s Highway User Revenue Fund are negatively impacting transportation infrastructure construction and maintenance. Read More>>
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Update June 22: West Virginia Gov. Jim Justice (D) signed Senate Bill 1006 into law on June 22. At the signing, Gov. Justice stated, “…One thing we didn’t miss the opportunity on was the roads. We passed an incredible roads package. It is truly landmark and what it will do for our state is unbelievable… This will save the day. This is and I’ve said it over and over again, is the 800-pound gorilla in the room and this will save the day.”
Secretary of Transportation Tom Smith confirmed the department is prepared to begin construction projects as early as July, with $30 million in advanced surface reconstruction resurfacing beginning once the legislation takes effect. The transportation funding measures are expected to create 48,000 jobs— both direct and indirect— within the state.
In October West Virginia voters will be asked to approve a $1.6 billion bond to accelerate transportation projects.
Original Post: The West Virginia legislature on June 16 approved legislation that will generate $135 million annually in new transportation funding. The bill now now goes before the Gov. Jim Justice (D) for final approval.
Senate Bill 1006 (SB 1006) amends several transportation-related taxes and fees, including:
- Adjusting the variable-rate state gas tax component (an additional 5 percent tax on the average wholesale price of gasoline, on top of the 20.5 cents-per-gallon flat excise tax) by raising the floor price (the minimum the tax can be charged at) from $2.34 per gallon to $3.04 per gallon. The resulting calculation would ensure that the variable-rate tax would never be less than 15.2 cents-per-gallon (as of Jan. 1, the tax has been charged as 11.7 cents-per-gallon);
- Increasing state department of motor vehicle fees (automatically adjusted every five years based on changes to the Consumer Price Index) and the consumers sales and service tax on sales of motor vehicles;
- Imposing additional registration fees for alternative-fuel and electric vehicles— an additional $200 for vehicles fueled with hydrogen or natural gas, $100 for vehicles operating on a combination of electricity and petrochemical fuels, and $200 for vehicles operating exclusively on electricity; and
- Increasing the sales tax on vehicles from 5 percent to 6 percent.
The legislature also approved Senate Bill 1003 to permit tolling on new roads and bridges or existing roads that are widened.
The new revenue could be used to fund a $2.8 billion bond proposal from Gov. Justice. Legislation approved on April 8 will ask voters to approve $1.6 billion in general obligation bonds before the end of 2017. The remaining bond revenue would be generated from Parkways bonds (funded by tolls on the West Virginia turnpike) and GARVEE bonds (utilizing future federal highway funding payments).
SB 1006 was proposed during the 2017 First Extraordinary Session, which convened May 4 to address unmet budget needs. The bill was proposed on May 16 by Senate President Mitch Carmichael (R- District 4) at the request of Gov. Justice. SB 1006 was passed initially by the Senate on May 24 and was amended by the House to remove an additional increase on the flat excise tax on gasoline before passage on June 16. The Senate made additional amendments and passed the bill on the same day. The House concurred those amendments and voted 54-32 to send the bill to the governor.
The variable-rate adjustment comes after an automatic 1-cent reduction in the amount the formula generated on Jan. 1, resulting in a $12.5 million loss to the state’s road budget. A 2015 study by the Contractors Association of West Virginia found that the state already needed an additional $500 million in new revenue for road projects, and a 2013 Governor’s Blue Ribbon Commission on Highways found a much larger need of $1 billion annually.
By Mark Holan, editorial director, ARTBA
The Illinois Department of Transportation (IDOT) may halt most roadwork by July 1 if state lawmakers can’t pass a budget that allows the agency to pay highway contractors and other vendors.
Gov. Bruce Rauner (R) has ordered the General Assembly to return to Springfield on June 21 to hammer out a budget before the month-end close of the fiscal year. The governor and Democratic-led legislature have wrangled over the budget for the past two years, and only agreed to a stop-gap measure for the current budget at the eleventh hour last June.
“While we are hopeful the situation is resolved before then, the department is notifying contractors that all construction work is to shut down on June 30,” IDOT said in a June 14 statement. “Contractors will be advised to secure work zones to ensure their safety during any potential shutdown. As always, the safety of the traveling public will be the top priority as the department works through this process.”
Illinois Road and Transportation Builders Association (IRTBA) President & CEO Mike Sturino said the impacts of a shutdown are “dire.” He cited Transportation for Illinois Coalition estimates of more than $3 million daily in direct costs associated with such an abrupt halt.
“IRTBA member firms report that layoffs of thousands of Chicago area residents are imminent,” Sturino said. “Organized labor is reporting approximately 30,000 people will be out of work statewide if this shutdown happens.”
Illinois has $15 billion in unpaid bills, and the state’s credit rating is sinking to “junk” status, Reuters reports. The state has identified needed repairs on more than 2,700 bridges, costing an estimated $10 billion, according to ARTBA’s 2017 National Bridge Inventory.
During special session on June 13, the West Virginia House Finance Committee amended and approved a bill to adjust the state’s variable-rate motor fuel tax (a 3.5 cents-per-gallon increase) and raise the vehicle sales tax by 1 percent, as well as increase other motor vehicle-related fees. The bill would generate an estimated $140 million annually. Read More>>
A Wisconsin lawmaker has proposed implementing a per-mile fee on heavy trucks in order to generate additional transportation revenue. Read More>>
Unless lawmakers reconvene for a special session this year, Louisiana is unlikely to pass a state gas tax increase until 2021. Read More>>
South Carolina Gov. Henry McMaster (R) vetoed a portion of the state budget that would have permitted Country Transportation Committees to spend up to 20 percent of the transportation funding received by the state on infrastructure projects that were not related to road work. Read More>>
With over 130 transportation funding bills introduced this year in 36 states, it’s clear that many lawmakers outside of the Nation’s capital understand the importance of supporting infrastructure investment. Some have passed measures signed into law by their governor, while others continue to shepherd proposals through their statehouse. In five states, lawmakers have passed legislation in 2017 to increase motor fuel taxes to support needed transportation investment.
Five state legislators will discuss their experiences, share advice on strategies to increase transportation funding, and seek to answer the question of “why now?” at the 4th Annual “National Workshop for State & Local Transportation Advocates,” being held July 12 at the Hyatt Regency Washington in Washington, D.C.
A “State Transportation Funding Champion Legislators” session will feature:
- Montana Rep. Frank Garner (R- District 7). Rep. Garner will discuss his state’s successful 2017 legislation to increase the gas tax by 6 cents-per-gallon— his state’s first gas tax increase since 1994— as well as implement a new fee for electric and hybrid vehicles.
- Tennessee Senate Speaker Pro Tem Jim Tracy (R- District 16). Speaker Pro Tem Tracy will share his experience with a successful multi-year campaign to increase the state’s gas tax and transportation-related fees.
- Louisiana Rep. Kenneth Havard (R- District 62). Rep. Havard will give insight into the challenges and strategies of the campaign to increase transportation funding in Louisiana.
- Oregon Rep. Brad Witt (D- District 31). Rep. Witt will explore a (currently pending) 2017 proposal to provide an $8.2 billion state transportation funding increase— how it was developed, why it was needed, and the campaign to advance it in the state legislature.
Additionally, Idaho State Sen. Bert Brackett (R- District 23), will join the “Tried & True: Raising Motor Fuel Taxes to Support New Transportation Investment” session to discuss 2015 legislation that included a flat excise tax increase. He will also discuss how the decision was made to continue the state’s fixed cent-per-gallon fuel tax structure and whether alternative fuel tax structures were debated. Additionally, Sen. Brackett will discuss Idaho’s 2017 transportation legislation seeking to continue to provide support for the state’s roads.
Other sessions include:
- “2016 – 2017 State Transportation Funding Increases Roundtable”
- “Alternative Transportation Funding Options”
- “2013 State Gas Tax Increases: Where are They Now?”
- “State and Local Transportation Funding Trends”
- “Building America’s Economic Expressway Campaign”
- “Federal Transportation Funding Developments”
The Workshop, a signature program of the Transportation Investment Advocacy Center™ (TIAC), is being held in conjunction with ARTBA’s Public-Private Partnerships (P3) in Transportation Conference.