Pennsylvania Calls Special Session to Resolve Transportation Funding Crisis

» After losing bid to install tolls along Interstate 80, state looks to other solutions to impending transportation funding gap. An opportunity to rethink the state role in transport.

Today, Pennsylvania state legislators will meet to fill a massive $472 million gap in the transportation budget — almost ten percent of the overall $6.1 billion in road and transit spending planned for this year. Governor Ed Rendell called the session after his plan to toll Interstate 80 fell apart due to a federal law that makes it illegal to use revenues gained from a Washington-funded road on something else. The I-80 tolls would have generated up to $950 million in annual revenue once the infrastructure was put into place by 2011 as originally planned.

The need to assemble a special legislative session comes at a terrible time for the state. Pennsylvania’s road and transit systems need $3 billion more a year, a 50% increase, just to remain in a state of good repair — and that estimate includes only $500 million for transit, arguably not enough. Meanwhile, the state’s ambitions for improved intercity rail services and better local transit in Philadelphia and Pittsburgh need billions more to be implemented.

Pennsylvania has a number of potential funding options from which to choose: Easiest would be raising its already relatively high 32.3¢/gallon fuel tax. A 10¢/gallon increase would raise an estimated $620 million a year. But other possibilities include tolling state-funded roads, encouraging public-private partnerships, establishing local option sales taxes (currently mostly forbidden in the state), and introducing a vehicle-miles traveled fee (VMT). Wanting to avoid hurting too much of an already weak economy, the state is likely to select some combination of these options.

With inadequate federal aid, Pennsylvania’s situation is likely to become more and more familiar for states throughout the country, all of which are having trouble maintaining planned expenditures because of a decline in tax revenues. But the need to raise revenues locally opens up a number of opportunities that are denied by relying on Washington to fund transportation.

Conservatives frequently make the argument that federal fuel taxes should simply be reassigned to states based on the source of those funds because locals “know better” than Washington when it comes to choosing how to spend the money.

I’m no proponent of lessened federal involvement in choosing how those funds are spent; immediately reapportioning national funds to the states would inevitably mean fewer funds for transit just about everywhere because most state legislatures are dominated by rural factions. And state DOTs are too frequently highway-oriented to take seriously their claims that they would treat all modes equally.

Yet with a need to find increasing revenues to maintain roads and transit in usable condition, states may have no choice but to increase their local funding commitment above and beyond the federal contribution. Pennsylvania’s special session demonstrates that there is a desire on the part of states to make that happen — they’re not going to simply let their infrastructure resources fall apart.

This requires states and their leaders to take a bigger political role in setting transportation priorities. If states raise their own revenues, they will be able to choose how funds are spent, and it’s up to the legislatures and governors to make those decisions. The specter of even more power for state DOTs should encourage advocates of transportation alternatives to push for increased spending on transit, bike lanes, and pedestrian resources at the state capital, not just in Washington.

This is not an impossible dream; since the Bush Administration, the federal DOT has altered its vision of transportation priorities dramatically — it’s quite clear that the Obama Administration is making a point to emphasize livable communities and alternative forms of transport, a complete turnaround from former Secretary Mary Peters’ road obsession. This kind of change did not come randomly but after years of lobbying from advocates and the resulting decision of the mainline Democratic Party to place itself on the side of those who want alternatives to private automobiles. We need to see similar transformations at the state level, and when we do, there will be nothing to fear from getting the states more involved in raising revenue and spending on transportation.

A funding crisis may thus encourage everyone to think differently about the role states play in choosing what to fund. There is no requirement that states prioritize highway spending. But cities and metropolitan regions need to demonstrate their importance in every state’s economy and show how alternative transportation is an important player in ensuring the viability of those places.

The dream of some livable city advocates that states be “abolished” is immature and completely unrealistic. State DOTs will continue to play the predominant role in determining how transportation spending is distributed in the United States, so we might as well work to get them on our side.

Image above: Pennsylvania’s Interstate 80, from Flickr user dougtone (cc)

15 Comments | Leave a Reply »
  • My state is in a big hole. I think first they should put tolls on the interstates and just use the money to repair each interstate which is hosting the tolls. They could then divert the money normally used on the interstates to be used elsewhere. I’m not sure how legal this would be though. I think the remainder should then come from a gas tax increase. I really think VMT is a no-go. It would be too hard to implement in the short term due to privacy concerns. It also would be extremely costly to install and enforce especially with the lack of precedent. The state definitely needs to allow local dedicated sales taxes as well. I really hope someone steps up and speaks for a gas tax since no one will at the federal level.

  • Brandi wrote: My state is in a big hole. I think first they should put tolls on the interstates and just use the money to repair each interstate which is hosting the tolls.

    Funny thing here is that PA would already be collecting tolls on I-80 if this is what they’d tried to do to begin with. By getting greedy and trying to use I-80 as a cash cow, they gambled big and lost bigger.

    Side note: I happen to know “dougtone” personally…nice photo, but I think using one from Stroudsburg (and the horrible condition of I-80 there) would have driven the point home further.

  • eldondre

    It’s worth noting that cities were most livable, in this country, when the federal government was least involved. Indeed, cities problems in the last century can most often be traced to the federal government. I’d also point out that at the time, most taxes were paid to the municipality NOT the state OR federal government which means people who wanted city services chose them. It’s not an altogether bad argument. As highway oriented as PennDOT is, it’s no more so than, say, the feds whose 80/20 match for highways is a major reason the states have had to be highway oriented, money simply hasn’t been available for transit in any meaningful form from the feds. Perhaps you have it backwards. At any rate, I do think tolling is coming and PPP’s are long overdue in this country, they work well in many countries. People need to realize that transportation, in any form, costs money and you can’t keep building new capacity without maintaining the old (antoehr short sighted federal policy).

    • simple

      That depends on how you define “livability”. The horrid slums that in many instances were cleared for urban renewal and highways were hardly “livable” in my book. The issue is that which replaced them had its own serious livability issues. Also try remember the chronic pollution (dense smog, burning rivers, dead lakes, etc.) that plauged most large US cities before the federal government got involved. I think you’re painting with too broad a brush to say cities were “most livable” when the federal government was “least involved.” The consequences of federal involvement have in fact been varied. Let’s embrace the desirable effects and fix those that have been less desirable.

    • Nathanael

      This is arrant nonsense. City livability has to do mainly with technology changes (clean water, sewers, et cetera).

      The lowest levels of federal involvement were prior to the construction of the sewage treatment plants, and no sane person would claim that THAT was the most liveable period.

  • deacon

    Considering the following: In Germany the gas tax is $ 6 give or take, in the UK the gas tax is $ 3 give or take, in the US the gas tax is $ 0.45 per US gallon of fuel. All the highways I’ve driven on in Europe are in great shape, must have something to do with the funds available. Not only do they have more money to play with, they have less roads to fix. I’d gladly pay another $ 0.55 per gallon if that means that the roads I use arent falling apart, or the bridges I use dont fall in rivers. I’ve had to buy 3 sets of tires for my car this year because of shitty roads.

    If a solution is to drop the federal gas tax to say 10c (or lower) make every state tax a minimum of 60c per gallon and add to that a vehicle weight tax (this would cover not only gas powered vehicles but also electric, natural gas, propane etc powered vehicles). It doesn’t bring about privacy concerns it simply makes the user pay as they should. The smaller more fuel effcient the vehicle the less you pay.
    The problem in the USA is people are very attached to their money so paint it as a cost saving, more money to buy other crap.

  • eldondre

    simple: with all due respect, the “horrid slums” were being addressed before the federal government got involved. The period of rapid expansion where immigration far outstripped the available housing stock gave birth to the city beautiful movement which is easily home to some of the most desirable urban projects like parks (Rittenhouse Sq vs Dilworth plaza). Chicago’s Millenium Park is simply the completion of a long term plan from this era. cities were indeed aware of these projects, far more so than the federal government which has long sought to drain the wealth from cities. most of your gripes have less to do with the federal government getting involved than the downfall of the industrial economy, for better and for worse. I think, perhaps, you’ve painted with far too broad a brush and need to reconsider. more to the point, slum clearance was largely ineffective. we still have slums to this day, many are far more dangerous. giving credit for long term trends to the federal government is inaccurate, at best. that isn’t to say some things the federal government has done haven’t been good, and placing value on externalities is one, but in actually investing in cities? that track record is extremely poor from the failed housing projects dating to the 30′s to standard lot sizes, the interstate highway system, welfare, etc. Let’s not forget it was the feds who did their best to bankrupt every last railroad. NY still has the best subway system in the country. the idea that pollution regulations have to be abandoned in order for states to have more control over how their infrastructure money is misleading at best. to say the state’s have a highway driven policy that goes against the grain of what the feds have been trying to do is false. the feds have been driving that policy for 60 years.

    • Nathanael

      “Let’s not forget it was the feds who did their best to bankrupt every last railroad.”

      Actually, the states helped out big time with crippling property taxes.

  • eldondre

    one could ask the question: what kind of people aren’t attached to their money? only fools really and we know what happens with fools and their money. the amount of the tax is only part of the problem, the other part is the way the feds reward new construction over maintenance. a gas tax is far from the only solution as people who drive hybrids still use the road the same way someone with an 88 buck regal. a gas tax certainly is aprt of the solution, but PA has the 14th highest gas tax, where does the money go? I think a combination of gas tax, tolls (A form of localization), and changing of federal matching rules to consider all forms of transportation is in order.

    • Nathanael

      “the other part is the way the feds reward new construction over maintenance.”

      That’s not really the Feds. It’s well documented that state legislatures routinely divert money which *could* legally be used for maintenance into new construction. The best guess I’ve read for why is that “elected officials thrive on ribbon-cuttings”, which is probably the real reason.

      I’m not sure what the correct response to this is, but it’s not a federal-vs-state issue. It may be a case where independent “authorities” do better than state DOTs due to a layer of insulation from the political officials who want to cut the ribbons.

      • Chris

        Haven’t read the article yet, but in relation to this point about independent authorities I’m personally pretty skeptical, their boards are easily stacked and they can easily just run a muck like a ministerial department. In fact you have to remember that lack of political control can easily cut both ways with independent authorities implementing their own policies regardless of what the public vote for.

  • Boris

    “Conservatives frequently make the argument that federal fuel taxes should simply be reassigned to states based on the source of those funds because locals “know better” than Washington when it comes to choosing how to spend the money.”

    I’m pretty sure that already happens. Each state must receive back at least 90% of the gas taxes it paid in.

  • J Muchagrove

    Where does the PA gas tax money go? I can guarantee you that it does not all go to road and transit projects. I bet a good deal of it is diverted to pay for something else.

    The state ‘crisis’ is a manufactured one, relying on tolls they knew they could not get approval for. Now that they have manufactured this ‘crisis’ they think we’ll roll over on whatever form of taxation they proffer.

    Nonsense.

    1. Demand the current liquid fuel taxes go 100% to road and transit projects with no diversion.

    2. Lease the turnpike. The sooner the better to put current turnpike commission and its band of merry criminal administration out of business.

    3. Roads need reconstruction much too soon. Spend the extra money now on better materials and demand the road contractor guarantee the work for 10 – 15 years.

    4. Run PaDOT as a business, not a gov’t organization. Stand or fall on profit / loss and we’ll replace you with a more efficient contractor if you cannot compete.

    5. Let Philly and Pitt pay more for their transit fares. I wish I could run my car as cheap as their bus and subway fares. Suck it up. Why do I have to subsidize their travel? They don’t subsidize mine!

    6. Cancel remaining construction on that useless I99, the Bud Shuster Male Enhancement Highway. The iron pyrite disaster on Skytop Mountain needs to come out of somebody’s hide but NOT THE TAXPAYER! We didn’t make that mistake.

    7. Live within your means. No huge salaries and bonuses for management. No fluff projects. No pork. No overpriced techy device when a 2×4 will do. Negotiate better contracts knowing if you can’t make ends meet you just can’t run to the till and steal it from the taxpayer. You have a right to earn a living but you have no right to get rich at my expense.

    7.

  • Fred

    My comment about this whole mess is why are the Govenor,and legislators always looking for the working person to bail them out by either raising the things we use the most or through taxation, I didn’t hear a single legislator offer to reduce their pay,nor did the Govenor,did you know they get additional money depending on what committes they are working with I feel through their poor performances and legislations they’ve passed they should set an example and reduce their triple figure incomes for the betterment of our state,stop taxing what little the working person brings home,reduce your pay to help the state programs”like that will happen”the tax payer really needs to start thinking logically or everyones going too loose.

  • Fred

    The other part to my comment is no matter what is inacted nothing is going to work remember road and bridge construction repairs all started many years ago with the gas tax,then it worked its way up the scale with many other passed proposals,now with gas drilling taxes waiting in the wings these taxes if enacted are going to produce large amounts of tax income for PA and if its not used properly by our legislators and wasted for pet projects and of course the famous “we vote ourselves a raise” they mays well not even enact this legislation cause it won’t benifit anyone or anything.When it comes to whats best for PA I feel the voters should have the final say so,even though our legislators are suppose to have our best interests at hand big decisions that effect the population voters of PA should have the right to vote whats best for PA, after all if we’re good enough to vote these individuals into office and have that trust and power,we should have the same to help our legislators make those tough decisions when it comes to the direction PA goes in financially

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