Governor Bob McDonnell’s omnibus transportation bill has undergone significant revisions during the General Assembly session, sloughing off two of its more controversial proposals, but it still has the environmental and smart-growth lobbies up in arms.
A House subcommittee amended HB 1248, a legislative behemoth that could be usefully broken into five or six separate bills, to cast off one measure that would have created an independent, statewide tolling authority. The authority would have been empowered to construct and operate toll roads, issue bonds backed by tolls but not the full faith and credit of the commonwealth, and set toll rates. It would have operated exempt from the Virginia Public Procurement Act and the Virginia Personnel Act. Smart growth lobbyists worried that the authority would be largely unaccountable to the public. But the deal killer may have been an op-ed published Feb. 2 on the Reason Foundation’s Out of Control Policy blog warning that the authority might compete with Public Private Partnerships. “If the new project is viable,” asked Robert Poole and Shirley Ybarra, “why wouldn’t a private entity consider this policy under the PPTA?”
House lawmakers also shed a provision for creating Transportation Improvement Districts consisting of territory within a five-mile radius of a transportation infrastructure project. Twenty-five percent of any growth in state General Fund tax revenues would have been transferred to transportation projects contained in the the state’s Six-Year Improvement Plan. Critics objected to the proposal as complex, unwieldy and opaque and an unneeded raid on the General Fund.
But the core of the legislation remains, including three provisions for tapping the General Fund to pay for transportation — a bigger share of the sales tax, a bigger share of end-of-year budget surpluses, and a slice of revenue growth in high revenue-growth years — as well as a measure that would give the state unprecedented power over local land use.
The McDonnell administration has justified the tax measures on the grounds that transportation is a “core function” of government that should be funded in part by the General Fund. Critics contend that, unlike education, public safety and health care, transportation has its own dedicated revenue streams; if the state needs more money for roads, raise those taxes and fees rather than diverting money from the General Fund.
Additionally, I have argued (though few seem to have picked up on it) that McDonnell’s proposal represents a historic shift away from the idea of financing roads and highways by means of a user fee — those who use roads are the ones who should pay for them — toward the idea of financing roads through general subsidies. Transportation is fundamentally different from schools and corrections. When the use of roads is free, people will always demand more. They will increase Vehicle Miles Traveled, congestion will increase, and the clamor for more, more, more will never cease. Conversely, if people pay the cost of expanding the road network through user fees, they will be far more judicious about the improvements they demand.
Meanwhile, in a press release issued yesterday, the Coalition for Smarter Growth, the League of Conservation Voters and the Southern Environmental Law Center detailed their objections to the revised bill. “The Governor’s omnibus transportation proposal … would substantially change decades of policies.” The Virginia Association of Counties (VACO) has expressed similar concerns, though in more muted tones. States the environmentalist press release:
The bill could take over $500 million each year from the General Fund for transportation, harming education, public safety, clean water programs, and many other needs—and, unlike transportation, there are few (if any) alternative revenue sources to meet these needs. In just the first two years, the sales tax diversion alone would take over $110 million from the General Fund; enough to fund an estimated 870 police officers, 275 doctors for rural communities, or health care for 77,673 children and mothers in Virginia’s children healthcare program.
For the record, the General Assembly’s Impact Statement estimates that the bill would transfer $110 million in the 2013-14 biennium and $200 million a year by Fiscal 2018, although under the right circumstances revenue transfers could spike significantly higher. While the funds nominally would go into the Highway Maintenance and Operating Fund, because funds are fungible, the transfer would have the effect of increasing road and highway construction.
… Which raises another objection by the environmental lobby. The revenue provisions provide zero new dollars for transit and rail.
Although the environmental/Smart Growth lobby has long called for aligning transportation and land use planning, its spokespersons are not happy about how the McDonnell administration proposes to do that. This bill would require the transportation elements of local comprehensive plans and regional Metropolitan Planning Organization (MPO) plans to be consistent with the Commonwealth Transportation Board’s statewide transportation plan and its Six-Year Improvement Plan. Any project not consistent with the statewide plans, can be deprived of federal and state funding. This would give the state a much greater role in planning local land use, the environmentalists say, and it would create a mismatch “by linking a long-range local planning document (comprehensive plan) to a short-term state funding document.”
One interesting provision not mentioned in the environmentalists’ press release is one that would require the Secretary to study the devolution of secondary road maintenance to local governments and submit recommendations by the end of the year. You can be assured that VACO will be watching that one very closely.
HB 1248 now awaits a vote by the Appropriations committee, while an unamended companion bill SB 639, received a bipartisan, 13-to-0 vote in the Senate Transportation committee.