Governor Perdue announced the creation of the NC Mobility Fund today as a part of her 2010-11 budget adjustments. The Fund will not be subject to the Equity Formula. While the details are not yet known for how the money will be distributed the budget notes that it will focus on critical congestion bottlenecks, improving logistics capabilities, and economic development goals. The monies used to create the fund include a reduction in the transfer from the Highway Trust Fund and an increase in various motor vehicle related fees. The first project to be funded is the Yadkin River Bridge.
NCDOT COO Jim Trogdon informs me that he is looking forward to working with the Metro Mayors and the League in developing the selection criteria for the Fund.
It is important to note that this is only the Governor’s Proposed Budget. It is now up to the legislature to determine if they want to include the NC Mobility Fund and the corresponding fee increases in the budget they pass into law. I will be attending the legislative meetings tomorrow to hear their discussions on the Governor’s Proposed Budget and keep you updated.
Governor’s Proposed 2010-11 Transportation Budget
(Excerpt from Budget)
This budget invests $22 million in a new, innovative North Carolina Mobility Fund that will be used to address critical congestion bottlenecks and to improve our logistics capabilities. The Fund would not impact the current equity formula and would be linked to statewide economic goals. The first scheduled project is the completion of the I-85 north section of the Yadkin River Bridge. Future funds will be available for all state transportation modes including roads, aviation, ports, transit and rail.
North Carolina Mobility Fund
The North Carolina Mobility Fund is created within the Highway Trust Fund. It is funded by re-ducing the transfer from the Highway Trust fund to the General Fund and increasing certain motor vehicle related fees. The purpose of the Fund is to create a dedicated source of revenue that can be used for projects that have statewide significance and are linked to statewide economic goals. The revenue available to the North Carolina Mobility Fund in fiscal year 2010-11 is $72.6 million. Table 11 shows the various fee schedules used to fund the North Carolina Mobility Fund for fiscal year 2010-11.
Drivers License Fees- Copies of Drivers License Records, Increase the fee 25%
Staggered Registrations- Automobiles and Light Truck Registrations. Increase fees 25%
International Registration Plan (IRP)- Trucks Used in Interstate Commerce, Increase various Interstate Motor Carrier Fees
Registration Fees – Miscellaneous Registration Fees under the Highway Trust Funds, Increase fees 33%
Transportation
Major Recommendations
Governor Perdue is extremely committed to investing funds in infrastructure projects to fa¬cilitate economic growth. Restoring and main¬taining the state’s transportation infrastructure and promoting public transit initiatives are key components.
The Governor’s budget recommendations include funds to establish the NC Mobility Fund. The fund will provide a dedicated source of transportation revenues for projects of statewide significance that are linked to statewide eco¬nomic goals. The funds will be available for all transportation modes, including aviation, ports, transit and rail. Critical congestion bottlenecks will be addressed and North Carolina’s logistics capabilities will be improved. The NC Mobility Fund will not be included in the equity for¬mula, thus relieving the load placed on regional transportation plans when they have to bear the burden of large statewide projects.
Total funding of $3.8 billion is recommended in support of North Carolina’s Transportation Program for fiscal year 2010-11. Over 75% of the funding is recommended for construction, maintenance, and public transportation activities throughout the state.
Figures 7 and 8 show the distribution of funding sources and appropriations for North Carolina‘s Transportation Program for fiscal year 2010-11.
Major Transportation Program Recom¬mendations
Provide $94.6 million to establish the NC Mo¬bility Fund for multi-modal transportation projects of statewide significance that are linked to statewide economic goals.
Return $22 million in funding to the trans¬portation program by further reducing the annual transfer from the Highway Trust Fund to the General Fund to be used for the NC Mobility Fund.
Provide $4.8 million in additional funds for ferry operations to ensure the current service levels are maintained.
Provide $4.3 million in rail funding for construction of the Pembroke Northeast Bypass project.
Completion of this project will facilitate improved multi-modal access to southeast North Carolina, linking the states military bases with state ports.
Approve $2 million for short-line railroad rehabilitation projects.
Provide $2 million for projects aimed at mak¬ing government operations more effective and efficient through investment in infor¬mation technology projects that streamline program operations.
Dedicate $1.6 billion, or 44% of total program resources, for the construction program.
Provide $934 million (24%) of total program resources for highway maintenance activities throughout the state.
Appropriation Items — Recommended Adjustments
Reductions 2010-11
Mandated Adjustments
1. Statutory Adjustment to Aid to Municipalities Allocation
In accordance with G.S. 136-41.1, an adjustment based on the estimated gallons of motor fuel sold is necessary to update the allocation for state aid to municipalities (Powell Bill) based on revised revenue estimates for the Highway Fund for fiscal year 2010-11. Appropriation ($785,319)
2. Statutory Adjustment to Leaking Underground Storage Tank Fund (LUST)
In accordance with G.S. 105-119(a) and (b), an adjustment is required to the appropriation for the Leaking Underground Storage Tank Fund to update the allocation based on revised revenue estimates for the Highway Fund for fiscal year 2010-11. Appropriation ($40,000)
Maintenance
1. Maintenance Funds
It is recommended that Highway Fund appropriations for maintenance of the state’s highway infrastructure be reduced to align overall requirements for the Highway Fund with projected revenues for fiscal year 2010-11. Appropriation ($3,698,277)
Transfers to Other State Agencies
1. Department of Public Instruction – Drivers Education A reduction in the funding for the Driver Education Program is recommended for fiscal year 2010-11 based on actual expenditures and historical reversion patterns for the program. Appropriation – Nonrecurring ($1,300,000)
Expansion 2010-11
Mandated Adjustments
1. Statutory Adjustment to Secondary Roads Construction Allocation In accordance with G.S. 136-44.2A, an adjustment based on the estimated gallons of motor fuel sold is necessary to update the allocation for secondary roads construction based on revised revenue estimates for the Highway Fund for fiscal year 2010-11. Appropriation $3,840,718
Ferry Division
1. Maintain Current Level of Services Additional operating funds are recommended for the Ferry Division to maintain their current level of services for fiscal year 2010-11. Operating funds were reduced for the 2009-11 biennium to balance the overall requirements for the Highway Fund with projected revenues. Appropriation $4,805,311
Rail Division
1. Grants to Short Line Railroads Provide funds to the Rail Division for grants to short line railroad companies to fund rehabilitation projects that strengthen North Carolina’s short line rail infrastructure. Appropriation $2,000,000
2. Pembroke Northeast Bypass Connector Provide funds to the Rail Division for construction of the Pembroke Northeast Bypass project. Preliminary engineering, environmental documentation and right of way acquisition have been previously authorized and are underway for this project. The connector will provide improved multi-modal access to southeast North Carolina, linking the states military bases with State Ports. Appropriation – Nonrecurring $4,325,000
Division of Motor Vehicles
1. Medical Certification Compliance Funds are recommended to allow the Division of Motor Vehicles to become compliant with new federal legislation that requires medical certification as part of the Commercial Driver License (CDL) process. All medical certificates for CDL applicants have to be reviewed to ensure they meet the medical requirements of the Federal Motor Carrier Safety Administration prior to issuance of a CDL. Appropriation $192,351 Appropriation – Nonrecurring $7,550 Number of Positions 5.000
2. Law Enforcement Vehicle Expenses Funds are recommended for motor fleet fees associated with specialized law enforcement vehicles assigned to the License and Theft Bureau within the Division of Motor Vehicles. The funds were reduced during the 2009-11 budget and are not sufficient to pay for currently assigned vehicles. Appropriation – Nonrecurring $344,722
Administration
1. IT – Payment Card Industry (PCI) Data Security Standard Compliance Funding is recommended for an information technology project that will allow the department to upgrade their computer applications and supporting infrastructure that process payment cards to become compliant with new standards imposed by Master Card. Funding is requested for required hardware, software, and assessment services to maintain PCI compliance. Appropriation $135,000 Appropriation – Nonrecurring $350,000
2. IT – Enterprise IP Telephone System Funds are recommended to replace the existing Interactive Voice Response (IVR) hardware and applications and annual operating funds required for IT expenses with an upgraded telephone solution for the Division of Motor Vehicles. The current IVR system is no longer supported and is critical to the Division’s ability to respond effectively to citizens’ needs and deliver a high level of customer service via its call center. The Division’s current telephone technology is outdated and ineffective, and the infrastructure cannot be updated to meet its future needs. Appropriation $544,289 Appropriation – Nonrecurring $515,000
Agency Reserves
1. State Employees Payback It is recommended that all employees paid from the highway fund receive a 0.5% one-time payback for the salary reduction taken to balance the budget in FY 2008-09. Appropriation – Nonrecurring $2,701,641
2. Retirement System Contribution It is recommended that the State’s contribution to the Teachers’ and State Employees’ Retirement System be increased in FY 2010-11. The increase represents the funds required for state employees that are paid from highway fund appropriations. Appropriation $930,050
Transfers to Other State Agencies
1. CC&PS-Provide Matching Funds to Continue VIPER Interoperable Communications Network Development Funds are recommended to be transferred to Crime Control and Public Safety to provide matching funds for the Public Safety Interoperability Communications (PSIC) grant from the U.S. Department of Commerce received by the Highway Patrol. The PSIC grant will be used to assist in the further development of the VIPER interoperable communications network. Appropriation $4,700,000
2. Department of Public Instruction – Drivers Education Funds are recommended to restore the recurring appropriation for the Driver Education Program based on findings of a continuation review of the program as directed by the 2009 Session of the General Assembly. Appropriation $33,321,964
Appropriation Items — Recommended Adjustments
Reductions 2010-11
1. Reduce Transfer to General Fund
It is recommended that the transfer from the Highway Trust Fund to the General Fund authorized by G.S. 105-187.9 be reduced by an additional $22 million for FY 2010-11. This reinforces the Governor’s pledge to eliminate this transfer by 2012. Appropriation ($22,000,000)
2. Statutory Adjustment to Secondary Roads Construction Allocation
An adjustment consistent with statutory formulas is recommended to the appropriation for secondary roads construction. The adjustment is required to update the allocation based on revised revenue estimates for the Highway Trust Fund for fiscal year 2010-11. Appropriation ($170,627)
Expansion 2010-11
1. Establish North Carolina Mobility Fund Notwithstanding G.S. 136-176(b), the recommended funds made available by further reducing the transfer from the Highway Trust Fund to the General Fund ($22 million) and other dedicated revenue sources from motor vehicle fees ($72.6 million) shall be used for the NC Mobility Fund. The funds will be available for all transportation modes and can only be utilized for the purposes outlined in an associated special provision that creates the fund. The request will facilitate establishment of a dedicated source of funding that can be used for projects that have statewide significance and are linked to statewide economic goals. Appropriation $94,583,983
2. Statutory Adjustment to Intrastate System Allocation An adjustment consistent with statutory formulas is recommended to the appropriation for the intrastate system. The adjustment is required to update the allocation based on revised revenue estimates for the Highway Trust Fund for fiscal year 2010-11. Appropriation $4,995,162
3. Statutory Adjustment to Urban Loops Construction Allocation An adjustment consistent with statutory formulas is recommended to the appropriation for urban loops construction. The adjustment is required to update the allocation based on revised revenue estimates for the Highway Trust Fund for fiscal year 2010-11. Appropriation $2,019,836
4. Statutory Adjustment to Aid to Municipalities Allocation An adjustment consistent with statutory formulas is recommended to the appropriations for state aid to municipalities (Powell Bill). The adjustment is required to update the allocation based on revised revenue estimates for the Highway Trust Fund for fiscal year 2010. Appropriation $524,109
5. Statutory Adjustment to Program Administration Allocation An adjustment consistent with statutory formulas is recommended to the appropriation for administration. The adjustment is required to update the allocation based on revised revenue estimates for the Highway Trust Fund for fiscal year 2010-11. Appropriation $371,520
