July | August 2017




Analysts See Expanded State Role in Transportation Funding

By Sean Slone, CSG Senior Transportation Policy Analyst
The start of negotiations on a multi-year federal surface transportation authorization bill between U.S. House and Senate conferees might appear to be progress to many—but not to UCLA professor Brian Taylor.
Even though the negotiations represent the farthest the process has gotten since the previous bill—known as SAFETEA-LU—officially expired in 2009, Taylor is unconvinced we are witnessing anything other than the demise of the federal program and the rise of state and local governments in funding transportation.
“There simply aren’t the votes (in Congress) for any sort of even what we might call a contracted recharging of the federal program,” said Taylor, who directs the Institute of Transportation Studies at the university. He will be among the speakers Friday, May 18, at the Transportation Policy Task Force session during The Council of State Governments’ National Leadership Conference in La Quinta, Calif. “It looks to be either sort of extending things as they are, which only exacerbates the problems that have been manifesting for several years now, or considerable retrenchment on many fronts.”
Taylor, whose research often focuses on the politics of transportation finance, believes the program’s demise can be traced to a number of factors, including the decline of the gas tax as a revenue source, the movement away from earmarks that helped grease the political skids for previous transportation bills and the lack of agreement on an overall purpose for the federal highway program in an era when the interstate system—the construction of which was a motivating force in the last century—is now complete.
“The growth in revenue (for transportation) has been at the local level through state and regional sales taxes and a variety of other sources,” Taylor said. “There’s been a lot of growth in bonded indebtedness. There’s nothing on the horizon that I can see that points to a coherent federal program. … There’s no evidence that I can see right now that any sort of dramatic resolution is going to occur. In fact, that transition to a significantly waxing state and regional role as far as I can tell is the most likely outcome.”
That may be bad news for a state like California, which faces unprecedented infrastructure needs in the years ahead.
“I’m not sure that we don’t have the worst (transportation) crisis in the nation,” said Bert Sandman of Transportation California, an advocacy organization representing the state’s construction industry, labor organizations and business community. Sandman also will speak at the CSG meeting in La Quinta. “(California’s) revenue stream (for transportation) is about $300 billion over the next 10 years and the need is about $600 billion. The most significant problem that we have in the short run is pothole repair alone. We’re spending a little under $2 billion a year in the state and the need is over $6 billion and growing annually.”
A 2011 statewide transportation needs assessment said 58 percent of California’s roadways require rehabilitation or maintenance. Moreover, the state has 14 of the nation’s 20 most congested transportation corridors.
Sandman’s organization has identified a series of possible funding solutions the state could employ to try to address those needs. Those options include encouraging more public-private partnerships to fund projects, reinstating a vehicle license fee, increasing the state gas tax on an annual basis, instituting a tire user fee, reinvesting fees collected as part of the state’s cap-and-trade program, and instituting a fee based on vehicle miles traveled.
Sandman will discuss the pros and cons and political viability of each of those funding options in La Quinta. He said he’s cautiously optimistic that the state could move forward with one or more of them.
“The pothole problem in California has gotten so bad that there is finally a realization that we’ve got to do something about it,” he said. “There is some optimism that we’re going to be able to accomplish something. … The problem is it’s just not going to be soon enough.”

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