Road Worrier

Road Worrier: NC leaders postpone worries about transportation taxes

bsiceloff@newsobserver.comApril 22, 2013 

— “We face a difficult problem,” Transportation Secretary Tony Tata told a Raleigh audience last week.

He used a simple PowerPoint slide to illustrate his problem, but he never quite asked us to face it.

North Carolina is one of the nation’s fastest-growing states, Tata said, so we will need more and more roads and other transportation improvements over the coming decade. But we will have less and less money to provide these needs.

On the video screen behind him, a blue arrow slanted upward to show 1.3 million more residents expected by 2023. A downward arrow marked an expected $1.7 billion drop in state and federal transportation tax revenues.

Gas tax collections are falling about 2 percent a year, Tata explained, “even when factoring in population growth – because our vehicles are more fuel-efficient.” Motor vehicle fee receipts are flat, and the highway use tax on car sales lags below pre-recession levels, he said.

He labeled the widening distance between these up and down trends: “Infrastructure gap. Decline in business and jobs.”

Then Tata veered away from any talk of an increase in North Carolina’s gas tax (higher here than in neighboring states) or the highway use tax (lower than our neighbors’) – or any other idea for generating more transportation money.

He was there on a different mission. Along with Gov. Pat McCrory, Tata rolled out an overdue overhaul of the state’s 24-year-old formulas for deciding where and how best to spend those dwindling transportation dollars.

Details are still to come, but it appears that their new Strategic Mobility Formula will reserve a bigger share of money for highway, transit and rail projects that reduce travel times and urban traffic jams – perhaps at the expense of rural needs.

More money will go to new construction, and less to maintenance and operations. Projects that promise to stimulate economic development will be rated higher under the new formula than they were in the past.

Tata floated an idea for a high-speed expressway that could link the Triangle to Virginia’s Hampton Roads area. And prospects may be looking up, suddenly, for a $171 million proposal to restore a 27-mile freight railroad line, abandoned by CSX in the 1980s, between Wallace and Castle Hayne in southeastern North Carolina.

Questioned by reporters, McCrory and Tata said they would wait a year or two before raising the idea of new transportation tax and fee revenues, to close that “infrastructure gap.”

That disappointed some transportation advocates in the audience, who had followed Tata’s slideshow closely.

“They’re just reallocating some of their existing funding streams,” Berry Jenkins, a lobbyist for Carolinas AGC, a construction industry group, said later. Jenkins also is co-chairman of NC Go, a broad-based roads and transit advocacy group that endorsed McCrory’s new spending strategy.

“But we hope this just becomes step one,” Jenkins said. “The bigger problem North Carolina faces is that we’re not investing in infrastructure. We can’t just keep saying we’re going to address that next year. It’s never going to be a convenient time politically.”

N.C. House and Senate members have picked up a variety of legislative ideas from other states this year, but they have shied away from big transportation tax initiatives that are popping up across the country.

Gas tax increases are being debated in more than a dozen states, and have been approved in a few. Wyoming’s tax will rise by 10 cents a gallon. Maryland’s will increase 4 cents in July, and up to 20 cents by 2016.

Oregon has found a way to tax drivers for the miles they travel. Arizona, Florida and Wisconsin are looking at a similar approach. Massachusetts legislators want to pay for transportation with $165 million in new tobacco taxes. Connecticut might collect tolls at the state line.

Non-fuel sales taxes could generate transportation money in a handful of states including Virginia, where a complicated tax package approved recently will cost each resident an estimated $80 to $200 a year.

Legislators want to plaster ferries and rest stops with billboards and sell commercial naming rights at parks in New Jersey, Louisiana and Michigan, to raise transportation money. Washington and Virginia have approved fees for electric-car drivers, who do not pay fuel taxes.

North Carolina has billboard and electric-car proposals that might raise a few hundred thousand dollars. The only gas-tax bill filed this year is a proposal to reduce it.

We’ll get around eventually to talk about ways to pay for our transportation needs, McCrory and Tata said.

“That’s the other part of the discussion,” Tata said. “Right now we’re trying to be more efficient and do more with what we have. What follows, I think, over the next year or two, is a discussion of revenues.”

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