You know it’s a slow summer news day when Scott Leake’s Virginia State Republican Caucus “News Clips” newsletter contains only five stories — and one of those is an editorial in the Bristol Herald Courier calling for tougher laws against negligent dog owners.
With my usual wells of ignorance and foolishness running dry, I am compelled to address a subject of a serious nature. This story was reported a couple of weeks ago in the Mainstream Media, and I never gave it the attention it deserved. But better late than never.
According to numbers in a June 18 financial report by VDOT’s CFO Rita Busher, the Virginia Department of Transportation budget is in bad shape and getting worse. Here are the highlights:
Revenues. In its Six Year Financial Plan, VDOT expects to see little more revenue in 2014 than it collects in 2009. “Total revenues and other financing sources” are expected to yield $4.74 billion, about 1.4 percent more than in 2009 — considerably less than anyone’s reasonable estimate of inflation. Here’s the really scary part: That forecast actually might be optimistic. It assumes a 1.5 percent annual growth in transportation revenues while rising gasoline prices could conceivably reduce gasoline consumption and gas tax revenues.
Maintenance first. In Virginia, highway maintenance and operations get first claim on state tax dollars. Thanks to inflation, Busher forecasts that maintenance expenditures will increase from $1.69 billion next year to $2.01 billion in 2014 — an 18.9 percent increase.
For the most part, toll revenues are already spoken for: Debt service is projected to increase to $413.6 billion in six years. That leaves less for everything else (although it’s worth noting that “earmarks and special financing,” whatever that refers to, also shows healthy growth over the next six years.)
Construction last: As a result, dollars allocated to highway construction are shrinking — to $984.1 million next year and then to $730.2 million in 2014. I believe that includes Virginia’s share of federal transportation spending. If we factor in inflation, that $730 million could look more like $600 million or less in real dollars.
Yes, Virginia, the transportation funding crisis is real. But it’s only one side of the equation.
Here’s what we don’t know: What’s happening to Vehicle Miles Driven? If people are driving less, they’re not clogging the highways. If that’s the case, then traffic congestion may not be getting worse — it may be getting better. If traffic congestion is getting better, then the $100 billion+ funding shortfall for road and highway projects anticipated over the next 20 years is likewise inflated and out of date.
Not only should the rising cost of gasoline whittle down the projected “need” for highway projects, it will change the priorities of those projects that have been identified. We have already discussed on this blog the outsized decline of property values on the metropolitan fringe, indicating that many households want to move closer to the urban core. If that’s the case, highway construction dollars likewise may need to move from the fringe to the core.
General Assembly Republicans have called for an audit of VDOT. That can’t hurt, but I don’t see VDOT performance as the real problem. The problem is that higher gas prices have rendered obsolete Virginia forecasts of travel demand and road/highway capital spending. What we need to audit is the list of highway projects and see how well they match up with evolving travel patterns in an energy-constrained era.
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