Sep 10, 2008

Road Ending for Fed Highway Funds

We might as well be on a bridge to nowhere.

That's the conclusion of regional and state transportation experts following the revelation the federal Highway Trust Fund, divvied out to the states for road projects, needs an infusion of $8 billion in emergency cash from Congress.

Judd Everhart, a spokesman for the Connecticut Department of Transportation, said no projects will be idled and contractors will continue to be paid in his state, despite the problems with the fund. But Gov. M. Jodi Rell, business leaders and transportation policy experts in the region are concerned about getting future projects started.

Especially since Connecticut is one of the states that gets more money from the fund than it puts into it. For every dollar collected in Connecticut, the state gets back about $1.41.

Rell said, in a letter urging the state's congressional delegation to support an emergency infusion, that Connecticut gets about $482.8 million a year for the trust fund and if the problem isn't addressed, the state's cut will fall to $322.2 million in 2009, which would cause some projects to be cut back.

"That could potentially impact several thousands jobs in our state during this time of economic hardship," she noted to the delegation.

U.S. Transportation Secretary Mary Peters told Congress on Friday the trust fund would go broke this month if Congress doesn't take action. She blasted the Democratically controlled Congress for not showing more fiscal discipline despite President Bush's and her warning of this day for three years.

"Congress should do away with billions in annual earmarks and consolidate the over 100 special niche programs that require states to slice and dice federal transportation funds to do things like build museums and restore lighthouses," she said.

Peters' main concern is the trust fund is on the hook for more money than it actually takes in from the 18 cent federal gas tax. She noted in her press release, that September revenues for the fund are projected at $2.7 billion but reimbursements for projects are $4.4 billion. She's pushing for reforms to deal with the next big transportation authorization due in September 2009.

Joseph McGee, vice president of public policy for The Business Council of Fairfield County, said he doesn't remember Washington being this earmark crazy in the 1970s when he worked for U.S. Rep. Stewart McKinney, R-4, from Connecticut. He said he was sure there were some there, but they were handed out by the leadership. Today, it seems like every Congressman gets some, he said.

The system today is just creating projects not a strong vibrant infrastructure, McGee said, and that's what's really troubling for the nation and state.

He said other nation's have recognized that infrastructure is the foundation for the economy.

"If you're not investing in your infrastructure, you can forget about your economy," McGee said.

When it comes to just maintaining roads, the state has relied heavily on Washington, which means a failure of the trust fund remains a concern.

"Connecticut is very dependent on federal transportation aid to do projects," said Mark Nielsen, executive director of the Greater Bridgeport Regional Planning Agency. He said the federal government pays for 80 percent of most highway-related projects in Connecticut while the state and local governments cover the remaining 20 percent.

The GBRPA creates the region's transportation plans and coordinates those plans with other planning agencies in the state. Nielsen agreed with the state DOT that this would not present an immediate problem, but he said down the road, larger projects like the Pearl Harbor Memorial Bridge in New Haven could be slowed as could other projects. But he said safety work would continue no matter what.

Connecticut's not alone in taking more out of the fund than other states. It is also not the biggest benefactor from the fund. Alaska, largely due to earmarks, including the now infamous bridge to nowhere was getting more than $6 for every $1 it put into the fund. The bridge to nowhere was a project to link a small community and airport, but the scope and cost of the project ballooned over the years.

Allison C. de Cerraño, director of New York University's Wagner Rudin Center for Transportation Policy and Management, said the issue of payments into and out of the fund can be misleading. She was one of the authors of a study that showed supposed "donee" states like Connecticut and Alaska can be seen as donor states when other factors are taken into account, like federal support for transit.

As for the issue with the trust fund, "There's still money coming in," said de Cerraño, who added, the problem is the amount coming is shrinking.

The federal tax is fixed at 18.4 cents per gallon. Americans have cut back consumption during the last eight months because of higher gasoline prices, which has reduced the amount of money coming into the fund compared to previous years.

From de Cerraño's point of view, the trust fund's near collapse is less troubling than the lack of a national policy on transportation.

"Our highways are no longer where they need to be," she said, noting more and more workers commute from their homes in suburbs to offices in other suburbs. In the greater New York Metro region, the roads lead into the city, she said.

The funding system also doesn't take the nation where it needs to go, she said, pointing out political rhetoric has called for a reduction in oil-based energy but a reliance on the gasoline tax for almost all the transportation revenues.

Connecticut's Transportation Strategy Board warned the state in 2002 that the federal highway fund and the state's own transportation funds were too reliant on oil and other sources would need to be tapped.

The funding problem "is worrisome," de Cerraño said, "but not as much as the lack of not having a vision."

She said the nation's infrastructure has been largely ignored and today there needs to be a plan laid out to move people and freight across the nation quickly and efficiently. Exactly what the plan would look like, she didn't say, but she said it should be comparable to the ideas that sparked the interstate highway system and the intercontinental railroad.

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