McCrory wants to borrow $1 billion for rural NC transportation projects | Raleigh News & Observer

Gov. Pat McCrory said Wednesday he wants the state to borrow more than $1 billion to “kick-start” a raft of mostly rural transportation projects.

“Our small towns are still struggling,” McCrory told an audience in Greenville. “And our major emphasis in economic development is going to be put toward our towns, you know, from 10 to 50 thousand people.”

The governor and Transportation Secretary Tony Tata traveled to four cities from Wilmington to Asheville to unveil a 25-year plan for rail, port, transit and highway investments across the state. Urban area priorities, such as mass transit and freeway upgrades, were included in McCrory’s “25-Year Vision for North Carolina.”

But when the governor said he would ask the 2015 General Assembly to approve revenue bonds to pay for a list of 21 or 22 projects, he said this borrowed money would be steered away from the larger cities. The major metropolitan areas are growing and enjoying economic revival, he said, while rural areas are in decline.

“We’ve looked at some specific projects where we think these bonds will speed up projects which really have been sitting on the sidelines,” McCrory said. “They’re projects ready right now.”

The projects tentatively targeted to receive bond funds, released late Wednesday by the state Department of Transportation, included urban loops in Fayetteville and Winston-Salem, along with rural highway improvements across the state. The only Triangle projects were U.S. 401 in Franklin and northern Wake counties, and N.C. 42 and Booker Dairy Road in Johnston County.

There appeared to be no overlap between the bond list and the statewide priorities spelled out in the governor’s 25-year plan. It included a new interstate route through rural northeastern counties to the economic hub in Virginia’s Hampton Roads area.

“If you go to Elizabeth City right now, which has a fairly high unemployment rate, we think the best opportunity for that region is to connect with Virginia and that economic center,” McCrory said.

McCrory also targeted two other highways to be upgraded to interstate standards: U.S. 74 from Asheville through Charlotte to Wilmington, and U.S. 70 in the eastern part of the state.

A long-sought multibillion-dollar overhaul for Interstate 95 was not on the governor’s list, nor was a stretch of U.S. 64 from Cary to Asheboro that DOT previously has targeted for an interstate upgrade.

Citing a forecast for steady population growth that will give North Carolina 12.5 million residents by 2040, McCrory’s plan says the state will need new revenue streams to replace or bolster the per-gallon gas tax, which is generating less money as Americans switch to cars that burn less gas or use alternate fuels.

McCrory said he will recommend new transportation revenue sources to the 2015 General Assembly – possibly in conjunction with a cut in the gas tax – to address needs expected to cost between $94 billion and $123 billion by 2040.

McCrory’s transportation plan (online at NCVision25.gov) divides most of his proposals into four regions, including:

• Coastal: Replace old bridges (such as the Bonner Bridge over Oregon Inlet) and stabilize inlets and navigation channels. Promote beach nourishment to protect infrastructure, such as N.C. 12 on the Outer Banks, which is slated to receive a buffer of beach sand at Rodanthe. Upgrade the Morehead City and Wilmington ports.

• Eastern: Improve rail and road links from the two ports to Interstate 95, military bases and the Global Transpark at Kinston. Bring U.S. 70 to interstate standards for shorter travel times and easier freight movement. Bring parts of U.S. 17 and U.S. 64 to interstate standards as part of a new freeway to Hampton Roads.

• Central: Expand light rail and other mass transit options in high-growth urban areas “to address the needs of a changing demographic, congestion and land development concerns.” Improve road and rail access to Charlotte’s inland ports and to the Piedmont Triad International Airport logistics hub near Greensboro. Continue interstate and other road improvements to ease the flow of freight and commuter traffic.

• Western: Strengthen interstate links to economic centers in neighboring Georgia, South Carolina and Tennessee. Improve industrial access to rail lines and highway routes to Charlotte and Winston-Salem.

How to pay for it

Other items include statewide improvements to public transportation – such as passenger train service, bicycle and pedestrian facilities – and public access to a broadband communications network along highway rights of way.

Julie White, who lobbies for cities as executive director of the N.C. Metropolitan Mayors Coalition, said she had not had a chance to study the list of mostly rural bond projects. She praised McCrory’s overall 25-year plan.

“It’s an exciting vision,” White said. “It encompasses all modes of transportation. The real question is how we’re going to pay for it. Where’s the money going to come from?”

If the General Assembly agrees next year, the state would issue revenue bonds to speed the start of projects that are ready or nearly ready to start construction, Tata said. The targeted projects would be expected to generate 20,000 to 70,000 jobs, depending on how employment is calculated, he said.

“It would be a loan, essentially, capitalizing on low interest rates,” Tata said. “The criteria for the projects would be that they have their permits complete and they would be ready to go within a year of approval of the bonds.”

McCrory said his new plan represents a shift away from politically driven highway spending.

“It’s taking, basically, the politics out,” McCrory said in Greenville. “And looking at the data for where we can create jobs, where we can save lives, and where we can create opportunity.”