Perry; "I think we can find substantial revenues to meet the needs we have without going forward with new taxes.”
by James A. Cooley
The Lone Star Report Copyright 2001
Volume 5, Issue 10
On Lt. Gov. Rick Perry ’s agenda for the 77th Legislature, transportation takes a back seat only to education. So Perry declared at the Oct. 23 kickoff of the “Plan It Texas” transportation project.
The Texas Department of Transportation (TxDOT) is developing, with public input, a 25-year master plan to keep the state moving. With population projected to grow 35 percent by 2025, Perry believes it’s time to rethink the state’s traditional “pay as you go” approach to funding transportation.
The state now funds a mere 36 percent of total transportation needs. In 1994-97, the construction backlog caused by scarce dollars translated into a 43 percent increase in annual hours of delay for drivers in medium to large cities. Growing congestion also exacts a high cost in human lives. Dallas now boasts the dubious honor of having three of the nation’s five most dangerous intersections.
“We have to do things differently,” Perry said. “We have to look at the entire process differently than we did 20 or even 10 years ago, because of the growth that has occurred in the state of Texas.”
However this doesn’t have to mean increased taxes.
“There are some who would rush out in front of the parade and say the answer here is, obviously, taxing Texans more – and that would be the answer to all our problems,” Perry said. “I don’t fall into either leading that parade, or [marching] in that parade. I think we can find substantial revenues to meet the needs we have without going forward with new taxes.”
Perry, along with Texas Transportation Commission Chairman John W. Johnson , provided insights into the leading options. The lieutenant governor thinks the following proposals worthy of considering:
• Grant Revenue Anticipation Vehicle bonds, or GARVEES. GARVEE bonds pledge future federal transportation funds as collateral. This debt option would require the approval both of the Legislature and of the voters in a constitutional amendment election. Perry says Colorado voters recently approved by a 63 percent margin $1.7 billion in GARVEE projects.
A GARVEE bill passed the Senate last session, but died in the House. One factor in its demise was a provision added by border senators that earmarked a portion of the GARVEE proceeds for their region. Guidelines being studied for GARVEES include reserving their use for very large projects (minimum of $100 million), maximum maturities of 15 years, and a total debt limit not to exceed 10 percent of Texas’ annual federal authorizations.
• Further study of the “Jackson Plan.” This proposal by Dallas County Judge Lee Jackson would allow the voters to create a revolving fund (using yet-to-be-determined revenue sources) that could be tapped to pay off transportation bonds. A less ambitious variation authorizes use of General Obligation (GO) bonds for transportation. The change would require a constitutional amendment, with separate action necessary to create the new revolving fund and/or the additional revenue sources. Perry suggested that one way to fund the Jackson Plan would be to redirect some of the transportation related fees and charges that currently go to General Revenue or are diverted from Fund 6 (the transportation fund) to non-transportation purposes.
• Adoption of the “Design/Build” model for transportation construction projects currently used by 20 other states and the District of Columbia. This model has led to an average 58 percent reduction in design time and allowed for 18 percent faster construction. Perry also suggested the state should look into obtaining warranties from construction companies for roads they build. New Mexico has received a warranty for 144 miles of State Highway 44.
Other items in Perry’s transportation agenda include expanded use of toll roads, including those constructed by the private sector; graduated drivers licenses, which require young drivers to follow a series of intermediate steps such as limits on nighttime driving before getting a license; truck-only lanes; and increased use of Intelligent Transportation Systems (ITS), or “smart highway,” technology.
Johnson, noting the enormous scope of the work needed, said Texans now register 17.4 million vehicles and drive almost 557 million miles daily. He estimates it would take an additional $500 million a year to make a significant dent in the backlog.
Johnson also criticized the diversion of transportation-related funds away from transportation needs. He said Fund 6 currently pays the entire $330 million cost of operating the Department of Public Safety. Another $204 million, he said, is collected in motor vehicle inspection, drivers license, and driver record fees, using personnel paid for by Fund Six – only to be deposited into general revenue.
Johnson also called for examining the current permitting system for overweight trucks, with an eye toward possible curtailment of the unrestricted use of load-limited bridges.
Another problem area is federal miserliness as to Texas’ NAFTA projects. A full 80 percent of US-Mexico border traffic goes through Texas.
“We need to get I-69 built,” said Perry. “We need to make the rest of the country understand that Texas has a very unfair burden due to NAFTA. We’re helping businesses all over the United States be able to transport their goods, to be able to make more money, to create wealth in other parts of the United States. Yet Texas is being discriminated against when it comes to infrastructure – particularly on the discretionary side when it comes to border funding.” He said discretionary funding levels should be at least doubled.
The Senate State Affairs Committee’s interim report, due Nov. 1, looks at transportation and will be the likely starting point for legislation. O
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