“We’ve seen 60 percent inflation over the last five years for transportation projects,” said Chris Lippincott, a TxDOT spokesman.
To look to the federal government for assistance would appear foolhardy at this point as the Federal Highway Trust Fund is expected to become insolvent by 2009. The fund was created in 1956 to ensure a dependable source of financing for U.S. interstates and highways.
“The Federal Highway Trust Fund is expected to go into the red very soon,” Lippincott said. “The need far outweighs the resources.”
The trust would have gone into the red sooner if over the past several years the federal government had not rescinded funding that states anticipated having at their disposal.
This year nearly $258 million in federal funds will be cut from the allotment Texas anticipated receiving. This comes on top of $666 million in federal cuts since January 2005, according to TxDOT.
With gas prices above the $3 a gallon mark, one unpopular solution to the funding crunch facing the federal government would be to raise gasoline taxes.
The federal gasoline tax has held steady at 18.4 cents since 1993 and would be 27 cents a gallon if it had kept pace with consumer inflation. States are in a similar boat in terms of not having had gas taxes keep pace with inflation.
“It’s a very difficult political sell to raise the gas tax to match the rate of inflation,” said Matt Sundeen, a transportation analyst for the National Conference of State Legislatures.
The Texas Legislature has recognized the inflation issue and given TxDOT the authority to issue bonds to help pay for highway projects.
“It’s cheaper now to repair highways by borrowing money than waiting,” said state Sen. Troy Fraser, R–Horseshoe Bay.
Critics say that while bonds may help the state get in front of inflation now, the debt could cause more problems in the future.
Fraser said that is an issue for the Legislature to worry about and when it is appropriate TxDOT should issue the bonds and move forward. He said the payback on the debt would not come from an existing TxDOT revenue stream.
“They’re being skittish by design,” Fraser said. “The Legislature does not want to go in the direction of the Trans-Texas Corridor but TxDOT is very adamant in going that direction. That’s what this battle is about, they’re trying to choose their own course.”
Lippincott says that whether lawmakers want to acknowledge it or not, without additional funding Texas transportation leaders will be forced to make a choice between adequately maintaining the state’s transportation thoroughfares and expanding existing roadways.
“Part of the reason the Trans-Texas Corridor is being pursued as a privately funded project is because traditional funding sources aren’t going to be available,” Lippincott said.
The state estimates it needs at least $23 billion in additional funding the next 11 years to maintain U.S. and state highways and roads as it copes with a burgeoning population.
The Texas Transportation Commission is set to meet on April 24 to discuss a state transportation plan for 2009 to 2019.
“In that plan commissioners will have a very tough decision on whether to continue funding projects at 2004 levels,” Lippincott said.
AP Business Writer Donna Borak contributed to this report.
promer@temple-telegram.com
