Press Releases and Newsletters
Trucking Group Opposes Vehicle Miles Tax (The Journal of Commerce)
Trucking Group Opposes Vehicle Miles Tax (The Journal of Commerce)
William B. Cassidy | Apr 21, 2010 4:10PM GMT
The Journal of Commerce Online – News Story
ATA says fuel taxes still best way to pay for highways, as interest in VMT grows
A Vehicle Miles Traveled tax may be gaining mileage on Capitol Hill, but the nation’s truckers want an alternate route. Replacing the federal fuel tax with a VMT would be too costly, a top American Trucking Associations official said yesterday.
Such a tax would be difficult to implement and to comply with, said Bob Pitcher, an ATA vice president. “Imagine the bureaucracy needed to oversee and collect VMT fees from millions of highway users,” he said at a symposium on mileage-based user fees.
A recent poll suggests a majority of Americans agree. Sixty-one percent of those surveyed by HTNB, an infrastructure contractor, said the U.S. should not try to reduce transportation greenhouse gas emissions through a vehicle miles traveled tax.
The idea of a VMT is surfacing more often as states and the federal government look for new ways to fund highway building and repair. Fuel tax revenues — the main source of highway funding — are forecast to decline as more fuel-efficient cars take the road.
Congress hasn’t raised the federal tax on gasoline and diesel since 1993, but construction and materials costs have risen since then, making it more difficult for the federal government and states to stretch the tax money deposited in the Highway Trust Fund.
The solution ATA favors is to raise the federal fuels tax, which is now 18.4 cents per gallon for gasoline and 24.4 cents per gallon for diesel. But the White House opposes increasing the tax, and there’s little support for a gas tax hike in Congress.
Some members of Congress see the VMT as a plausible alternative — especially when it’s backed by new technology. Rep. Earl Blumenauer, D-Ore., wants to include language in the next surface transportation bill to extend an Oregon VMT test nationwide.
“This is something we could flip the switch on before the next reauthorization cycle,” he said. “We need to get out of the downward death spiral in transportation funding.”
The University of Iowa’s Public Policy Center is testing a VMT in a $16.5 million federally funded research project. Nevada just launched a three-year VMT study. Most authorities on the subject believe a transition to a VMT would take several years.
The trucking industry, however, compares the VMT to weight-distance taxes that more than 20 states have repealed as outdated and ineffective, Pitcher said. All but four states rely on a combination of truck registration fees and fuel taxes for road money.
That system should stay in place even if a VMT is introduced for car drivers, according to ATA. Diesel use is likely to remain more stable than gasoline consumption, as there are fewer readily available alternatives to diesel for over-the-road trucks, ATA says.
Keeping the fuel tax in place for truckers makes sense even if a VMT is introduced for car drivers, says ATA, because over-the-highway truckers don’t have a readily available alternative to diesel, and probably won’t for a long time to come. That will keep diesel consumption relatively stable, while gasoline use declines, the association said.
Contact William B. Cassidy at [email protected].
N.C. Electorate More Urban, Independent (The Pilot)
N.C. Electorate More Urban, Independent (The Pilot)
By Bob Hall, Democracy North Carolina
Sunday, April 18, 2010
A county-by-county analysis of North Carolina voters points to dramatic shifts in the past decade that will likely influence campaign strategy for hot elections this year for Richard Burr’s U.S. Senate seat and for control of the General Assembly.
The numbers tell the story. For example, while the registration rolls of Democrats and Republicans have grown by 11 percent and 16 percent respectively since 2000, the number of voters choosing to not affiliate with any party soared by 83 percent. In fact, the 627,500 new unaffiliated voters are over half of the 1.16 million voters added during the decade.
The report provides county-by-county data on the changing racial and partisan composition of the electorate, the growth of urban counties, the increase in young voters and the number of adults not registered to vote. (Some voters move away or die as new ones register, so the focus here is on the net change.)
Unaffiliated voters now make up nearly one-fourth (23 percent) of the 6.1 million registered voters in the state, compared with about one in seven voters (15 percent) in 2000. Similarly, while the number of white voters increased by 572,500 or 15 percent to 4.46 million, the number of African-American voters jumped by 383,500, or 41 percent, to 1.32 million.
More than half the increase in voters of color for the decade came in 2008, when Barack Obama won the Democratic primary and general election. While 83 percent of adult whites are now registered, the figure is now 87 percent for people of color. But contrary to the portrait of blacks as loyal Democrats, 21 percent of the nonwhites who registered in 2008 signed up as unaffiliated.
Accurate figures for Latino voters are hampered by changing questions about race and ethnicity on voter registration forms over the decade; ethnicity was not asked until 2002. As of Jan. 2, 2010, there were 72,750 Hispanic/Latino voters, a substantial jump from 41,900 at the beginning of 2008. One-third are now registered as unaffiliated, 46 percent as Democrats and 20 percent as Republicans.
Democrats can be thankful for the 2008 registration surge; more than 90 percent of their net gain in members for the decade came during that one year. Still, Democrats lost their overall share of the electorate, going from 50.6 percent of registered voters 10 years ago to 45.4 percent now, the first time in a century that the party has started a decade with less than half the state’s registered voters.
Urban Counties Stronger
The 2008 election also showed the growing muscle of the state’s urban counties, which will likely be the key focus in the 2010 U.S. Senate race. The seven most populous counties in the state now have 37 percent of all the registered voters.
In 2008, those seven counties (Wake, Mecklenburg, Guilford, Forsyth, Cumberland, Durham and Buncombe) gave Barack Obama, Kay Hagan and Bev Perdue a lead of more than 300,000 votes each, enough to overcome the rest of the state’s majority support for their Republican opponent.
The next 13 counties in size have 22 percent of the state’s voters, and 11 of them strongly favored Republican statewide candidates in 2008. They include Gaston, Union, Cabarrus, Johnston, Onslow, Davidson, Iredell, Catawba, Alamance, Randolph and Rowan. Together, these 20 counties account for 60 percent of the state’s voters, and they are expected to be the central battleground for the U.S. Senate contest.
Young voters age 18 to 25 now make up 12 percent of the electorate, an increase from 10 percent a decade ago, and they provided significant energy in the 2008 election. However, there is no guarantee they will be engaged in the 2010 election: While 60 percent of the state’s registered young voters turned out in 2008 (compared with 70 percent of all voters), Democracy N.C. found that only 4 percent voted in the cities with November 2009 elections (compared witho 16 percent of all eligible voters).
Overall, the number of registered voters has increased 24 percent over the decade, while the adult population climbed only 19 percent. But the pace of new registrations has slowed considerably. In the four months from mid-September 2009 to mid-January 2010, the rolls gew by only 19,000 voters. During a similar period two years ago, 60,000 voters were added to the rolls.
The decade began with 84 percent of the voting-age population registered, up from 81 percent in January 2000. Democracy N.C. estimates that about 1 million citizens are currently not registered to vote, or 15 percent of the eligible population.
Precise Numbers Elusive
It’s difficult to get precise numbers on how many eligible adults are not registered in North Carolina, because (a) the voter registration rolls are inflated with some people who have moved away, and (b) the voting-age population includes noncitizens.
Data for some counties can show a high registration rate, or even more registered voters than resident adults, particularly the counties with a significant university or noncitizen population or where the local board of elections conducts infrequent mailings to identify voters who have moved.
Recent research calculates the voting-age population minus registered voters to produce each county’s “VAP Unregistered,” but these numbers should be treated as approximations because of the imprecise nature of the underlying data.
Other highlights in the data assembled by Democracy North Carolina from the State Board of Elections and State Data Center:
— Wake County now has more adults than Mecklenburg County, and more unregistered voters.
— Seven of the 10 counties with the fastest growth of unaffiliated voters are along the coast, no doubt fueled by Northerners who are unsure how they align with local party politics.
— Cumberland, Onslow and Wayne, the state’s three big military counties with chronically low voter participation, are among the 10 counties that posted the biggest increases in their registration rates, with 13 to 20 percentage point gains compared with the statewide three-point gain.
— Statewide, Democrats added 10,600 more registrants than Republicans during the decade, thanks to gains in the big counties, particularly in 2008. Republicans have added more members than Democrats since 2000 in 79 of the 100 counties, but in five counties Democrats surpassed Republicans by 167,000 registrations: Mecklenburg, Wake, Guilford, Durham and Cumberland.
Democracy North Carolina is a nonpartisan organization that uses research, organizing and advocacy to “increase voter participation, reduce the influence of big money in politics and achieve a government that is truly of the people, for the people and by the people.
N.C. joins effort to cut crime costs (News and Observer)
N.C. joins effort to cut crime costs (News and Observer)
Published Thu, Apr 22, 2010 05:32 AM
Modified Thu, Apr 22, 2010 12:55 AM
Facing a tight budget and surging prison population, Gov. Bev Perdue announced a move Wednesday that is aimed at cutting costs while keeping the public safe.
North Carolina will work with the U.S. Justice Department, the national Council of State Governments Justice Center and the nonprofit Pew Center on the States to study why so many young people end up in prison and to invest in new programs aimed at addressing the root causes of crime and recidivism.
North Carolina must remain tough on crime, the governor said, but the state must also be smart on crime.
Perdue cited figures showing that the state prison population grew by one quarter between 2000 and 2008, while North Carolina’s spending on corrections nearly doubled. If that rate of growth continues over the next decade, the state will need to build 8,500 more prison beds, costing about $2 billion.
“You can’t build prisons fast enough,” the governor said. “The question I ask, as amama and a grandmama, is do I want to spend all our new money on prisons, or do I want to spend our new money on education and jobs.”
By participating with the national groups in the justice reinvestment program, the state expects to benefit from research expertise gained from similar programs in states such as Texas and Michigan. Perdue said any recommendations at the end of the process would be data-driven solutions that would require bipartisan support.
As she spoke in the state House chamber at the Old State Capitol, Perdue, a Democrat, was flanked by legislators from both parties, as well as criminal justice officials.
Rep. Paul “Skip” Stam, the Republican leader in the House, said he supports the data-driven approach set out by the reinvestment plan.
“We all agree that the first, indispensable role of state government is to protect people from danger, and not lose sight of that,” said Stam, a lawyer from Apex. “I’m happy to join this effort because we do agree that the solutions we come to ought to be driven by facts and policy, and not just be preconceived notions.”
Perdue predicted that the recommendations that come at the end of the research could be controversial and present difficult choices, but she reiterated that public safety would be the priority.
“There will be those who say, ‘What in the world is going on?'” Perdue said. “There will be those who question the data we mine. … But doing nothing will only force the state to do more of the same.”
[email protected] or 919-829-4698
Current year revenue still lags (News and Observer)
Current year revenue still lags (News and Observer)
Submitted by bniolet on 2010-04-21 15:28
North Carolina’s revenue was $56 million behind projections at the end of March, according to state budget officials.
Budget staffers recapped Gov. Bev Perdue’s budget proposal for the next fiscal year in a joint appropriations committee meeting this morning, Mark Johnson reports.
They said revenue would be $330 million or 2.6 percent short for the current fiscal year without the money brought in last year by a Revenue Department project to resolve tax disputes with corporations and businesses.
UPDATE: The committee’s chairs, who are the legislature’s chief budget writers, made clear Wednesday they want major changes in Perdue’s spending plan for the fiscal year that begins July 1.
Asked for his major concerns over Perdue’s plan, which even she made clear is only a starting point, budget committee co-chair Jim Crawford, an Oxford Democrat, held up the whole 230-page book. Senior co-chair Mickey Michaux, a Durham Democrat, added: “The whole damn thing.”
Michaux and Sen. Linda Garrou, a Democrat from Winston-Salem, expressed particular skepticism over Perdue’s proposed $500 million in education cuts.
Whatever changes they make will be quick. Garrou pledged the Senate would vote on a budget on May 20, a week after this year’s legislative session begins.
Gov. Perdue and State Leaders Announce Justice Reinvestment Approach to Increase Public Safety and Reduce Recidivism and Corrections Costs
Gov. Perdue and State Leaders Announce Justice Reinvestment Approach to Increase Public Safety and Reduce Recidivism and Corrections Costs (Press Release)
RALEIGH—Gov. Bev Perdue, Chief Justice Sarah Parker and state House and Senate leaders announced today a bipartisan effort across state government to develop a data-driven approach to public safety that will reduce spending on corrections and reinvest the savings in ways that prevent recidivism and hold offenders accountable for their actions.
State leaders announced their partnership with the Council of State Governments (CSG) Justice Center, the Pew Center on the States, and the U.S. Department of Justice’s Bureau of Justice Assistance (BJA), to analyze North Carolina’s criminal justice system using a “justice reinvestment” approach. State leaders worked together to secure this public-private assistance and financial support.
“By using a data-driven approach, we will get the information we need to ensure that every taxpayer dollar spent on corrections and other public safety measures has the greatest impact on crime,” said Gov. Perdue. “It will also allow us to reinvest savings to reduce recidivism, in turn, reducing the additional prisons that may be needed over the next ten years.”
Between 2000 and 2008, the state’s prison population increased by 25 percent from 31,581 to 39,326 inmates. During that same eight years, the Department of Correction budget increased from $918 million to more than $1.31 billion. The North Carolina Sentencing and Policy Advisory Commission projects that if existing policies remain unchanged, the prison population will increase by another 25 percent between 2009 and 2019 and the state will need an additional 8,500 prison beds.
“Our courts across the state are impacted by recidivism every day as individuals return to court charged with new crimes,” said Chief Justice Sarah Parker. “Regrettably, many of these repeat offenders are young adults. Hopefully, this initiative will help in reducing the criminal case loads in our courts and result in savings in terms of both dollars and human potential.”
“As a state, we must do more to stop the cycle of people returning to prison. I am supportive of this effort to help people lead more productive lives and stay out of our criminal justice system for good,”said Senate President Pro Tempore Marc Basnight.
To guide the work of the project, the state has established a Justice Reinvestment Work Group composed of state agency heads, legislative leaders from both political parties and top court officials. Perspectives and recommendations from groups directly and indirectly involved in the criminal justice system, including judges, district attorneys, public defenders, law enforcement officials, advocates for crime victims and survivors, and community treatment providers will also be solicited.
“This bipartisan initiative brings together various agencies and stakeholders that might not otherwise collaborate extensively,” Speaker Joe Hackney said. “All of us are committed to developing stronger corrections policies that will reduce costs to taxpayers while also protecting the public.”
“Ever since hearing how other states have used a justice reinvestment approach to make their criminal justice system more cost-effective, I’ve been eager to see North Carolina pursue a similar approach,” said Rep. Alice Bordsen, co-chair of the Appropriations Subcommittee on Justice and Public Safety.
“The data analysis that is being conducted for this initiative will reveal who is making up the corrections population, including the numbers of people identified as having mental health and substance abuse issues,” said Senate Minority Leader Phil Berger. “This assessment will help us in deciding how best to spend public safety dollars.”
“I’m eager to review the data so we can develop sound policies that control correction spending, while improving the safety of North Carolina communities,” said House Minority Leader Paul Stam.
“BJA is pleased to provide assistance to state officials in North Carolina who have demonstrated a bipartisan interest in using a justice reinvestment approach,” said Andrew Molloy, BJA Associate Deputy Director for Justice Systems.
In 10 other states, the CSG Justice Center has partnered with Pew and BJA to help policymakers analyze data and develop legislative packages that have generated hundreds of millions of dollars in savings that have then been reinvested in strategies to increase public safety and reduce recidivism.
“I learned about the successes with justice reinvestment in other states as a board member of the CSG Justice Center,” said Mecklenburg County District Attorney Peter Gilchrist. “I’m pleased prosecutors will be involved in the process of identifying options for the state of North Carolina to address crime in a smarter way.”
“We have high expectations that our partnership will produce a significantly greater public safety return on North Carolina’s correctional dollars,” said Adam Gelb, director of Pew’s Public Safety Performance Project. “Fifteen years ago, North Carolina put in place a model system that increased prison terms for violent and career criminals and established a partnership with counties to supervise low-risk offenders in the community. Now there is a strong commitment from top state officials to build on that national leadership.”
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The Council of State Governments Justice Center is a national nonprofit organization that serves policymakers at the local, state, and federal levels from all branches of government. It provides practical, nonpartisan advice and consensus-driven strategies— informed by available evidence—to increase public safety and strengthen communities. To learn more about the justice reinvestment strategy in North Carolina and other states, please visit www.justicereinvestment.org.
The Pew Center on the States is a division of The Pew Charitable Trusts that identifies and advances effective solutions to critical issues facing states. Pew is a nonprofit organization that applies a rigorous, analytical approach to improve public policy, inform the public and stimulate civic life. www.pewcenteronthestates.org
Perdue rolls out changes for $19B N.C. budget (Associated Press)
Perdue rolls out changes for $19B N.C. budget (Associated Press)
By GARY D. ROBERTSON
RALEIGH — Democratic Gov. Beverly Perdue proposed Tuesday that legislators trim another 2 percent in state spending from North Carolina’s government budget for the coming year in part by eliminating or reducing dozens of programs and requiring cash-strapped local school districts to make even further reductions.
Perdue released her recommended changes to the second year of the two-year budget approved by the General Assembly and signed by the governor last summer. Her plan would reduce the budgeted amount by a net $410 million to $19.1 billion.
The reductions she wants starting July 1 reflect the still-troubled economy generating less tax revenues than was predicted last August. Tax collections are only expected to grow 2.7 percent. It’s still an improvement over the historic 10.9 percent decline in collections the last fiscal year and the slight decline for the year ending June 30.
“North Carolina’s economy is stabilizing again,” Perdue told reporters in releasing the plan, but “I don’t believe any time soon we’ll be back to the giddy days of 2007 and early 2008 … This budget helps us set the table for that ‘new normal’ and it also propels where we need to be as the economy improves.”
While the governor said the proposal reduces spending by $950 million, it would funnel much of those cost savings toward expanding her “Ready Set Go!” education initiative and small business tax breaks and corporate incentives, teaching more community college and university students, improving mental health services and pay for employee salaries and benefits.
Perdue also wants a new transportation fund, paid for mostly with higher fees, to build urgent projects like the Yadkin River Bridge replacement on Interstate 85. The Medicaid program to provide in-home personal care services would be retooled to get a handle on overspending after efforts this year have failed.
There are no broad-based tax increases, although car and truck owners would see their annual state vehicle registrations rise from $28 to $35 to pay for the new North Carolina Mobility Fund, which Perdue’s office hopes will one day reach $300 million.
“It’s a realistic budget. It makes tough decisions now instead of kicking them backward or forwards for another time,” Perdue said. Another 600 positions would be eliminated in addition to the 2,000 this year, according to Perdue, although most of newly targeted positions are vacant.
The state also expects another $578 million in expected federal stimulus funds to help close a budget gap projected at $1.2 billion. Given that Perdue also held back funds in this year’s budget to narrow a revenue shortfall, Republicans weren’t impressed with what the governor called a fiscally sound plan.
Fellow Democrats who control the House and Senate already are working on their own budget adjustments ahead of the May 12 convening of the Legislature.
“I have talked with Gov. Perdue about her guiding principles for this budget and they align with what most of us in the General Assembly support,” said House Speaker Joe Hackney, D-Orange. “This is a strong document for us to start with.”
Perdue’s budget office said most state agencies would take an additional 4.5 percent to 7 percent spending reduction on top of 10 percent reductions last year. The paring of public education would be a little less, but education leaders lamented additional reductions.
The state’s local school districts also would have to find another $215 million in discretionary spending reductions. Districts that eliminated more than 4,000 teacher positions this school year while finding a combined $225 million in savings could have to eliminate another 2,430 positions next school year, the North Carolina School Boards Association said.
Transportation fund would ride on $7 car fee (News and Observer)
Transportation fund would ride on $7 car fee (News and Observer)
Published Wed, Apr 21, 2010 06:56 AM
Modified Wed, Apr 21, 2010 12:16 AM
The governor called Tuesday for a $7 increase in car registration fees as part of a plan to establish a fund for big statewide transportation projects.
Her budget proposal included $94.6 million to create the N.C. Mobility Fund. In a letter to the legislature, Perdue said the fund would “address critical congestion bottlenecks.”
Durham Mayor Bill Bell praised the proposal.
“We believe infrastructure spending such as this will both create jobs and address the urgent congestion needs in our state,” said Bell, chairman of the N.C. Metropolitan Mayors Coalition, an advocacy group for urban needs.
It wasn’t clear how Mobility Fund projects would be selected or who would pick them.
Administration officials said most of the money for the first two years would be earmarked for a $150 million project to widen a four-lane section of Interstate 85 near the antiquated Yadkin River bridge at Salisbury.
To create the fund, Perdue would turn to two sources: She called for increases in Division of Motor Vehicles fees worth $72.6 million. Her budget would generate $48.9 million by adding 25 percent or $7 to car registration fees, now $28. An additional $17 million would come from a 25 percent increase in the fees insurance companies pay for copies of driver license records.
Staff writer Bruce Siceloff
Perdue taps two familiar sources for transportation money (News and Observer)
Perdue taps two familiar sources for transportation money (News and Observer)
Published Wed, Apr 21, 2010 11:42 AM
Modified Wed, Apr 21, 2010 11:43 AM
RALEIGH Gov. Bev Perdue isn’t ready to hike taxes to meet more of the state’s transportation needs, but in her 2011 budget proposal she finds $94.6 million in “new” money from two sources the legislature has tapped in the past.
She proposes to hike Division of Motor Vehicles fees again ($74.6 million) to help establish the N.C. Mobility Fund for big transportation projects. (See today’s story – some details were cut because of space limitations.)
And she cuts off another slice ($22 million) of the controversial transfer from the road-building Highway Trust Fund that, until a few years ago, was pumping $172 million a year into the non-transportation General Fund.
The annual registration fee for cars and light trucks will rise from $28 to $35 if the legislature adopts Perdue’s recommendation.
That’s worth $48.9 million. Car owners won’t be happy about the $7 increase, especially after DMV has been so ham-handed and customer-hostile in its two-year campaign to link inspections with registration renewals.
The fee paid by insurance companies to get copies of driver license records also would rise by 25 percent, to generate $17 million. Insurance firms won’t like that. Two other DMV fee hikes are worth $6.7 million.
The Highway Trust Fund transfer was established in 1989 to compensate the General Fund for the loss of about $172 million in yearly sales taxes on cars. The car tax was replaced by a similar highway use tax on car sales, with this money going to the Highway Trust Fund instead.
It wasn’t controversial until the Easley administration and the General Assembly started raiding the Highway Trust Fund to balance the General Fund budget. Between 2001 and 2006, they took an extra $525 million from the Highway Trust Fund. Later they repaid only $125 million of this.
But – blog commenters and letter writers to the contrary – legislators and governors stopped plundering the Highway Trust Fund after 2006, and they started phasing out that annual transfer to the General Fund.
For fiscal year 2010, the General Fund received $108.5 million from the Highway Trust Fund. The other $64 million went to the N.C. Turnpike Authority, to cover gaps between the cost of three toll road projects and the money expected to be collected in toll revenues from drivers.
Starting in 2011, the Turnpike Authority will get $99 million a year in gap funding for four projects: the Triangle Expressway in Wake and Durham counties, the Monroe Connector / Bypass in Mecklenburg and Union counties, the Mid-Currituck Bridge in Currituck County, and the Garden Parkway in Mecklenburg and Gaston counties.
That would leave $72.8 million to be transferred from the Highway Trust Fund to the General Fund, but Perdue wants $22 million of this for her new N.C. Mobility Fund.
If the legislature agrees, the General Fund transfer will drop to $50.8 million a year.
And there will be more reductions in that number in coming years. Perdue wants the
yearly appropriation for her Mobility Fund to grow to $300 million a year.
If she grabs that other $50.8 million in 2012, where will she find the rest?
A gas tax hike doesn’t seem likely. But the highway use tax on car sales, lower in North Carolina than in neighboring states, looks like a sronger candidate once the economy rebounds.
You can expect political leaders to consider hiking the use tax rate, or changing the way North Carolina calculates it – which reduces the tax based on the value of trade-in cars.
But not this year.
Perdue’s Mobility Fund Unnecessary (The Progressive Pulse Blog)
Perdue’s Mobility Fund Unnecessary (The Progressive Pulse Blog)
Posted at 11:48 AM by Stephen Jackson
April 21, 2010
The key part of Governor Perdue’s transportation budget released yesterday is the creation of a ‘Mobility Fund’. This fund is to be used for projects with major logistical priorities for our state, be they road, bridge, port or rail.
Initially the new pot of road money will be funded by taking $22 million of the transfer from the Highway Trust Fund to the General Fund and adding in over $70 million in higher DMV fees, most notably the proceeds from a 25% increase in passenger vehicle and light truck registration fees. Perdue announced she hopes to add an extra $100 million in annual money next year to the fund, and then another $100 million per year in 2012-13.
Grandiose names aside, lets call this fund what it is. Its an ad hoc response to get the I-85 bridge over the Yadkin River built because the hoped-for federal stimulus money never came through. It is policy-making on-the-run and the executive’s creation of it reveals more about the deep problems with road and bridge funding in this state than anything else.
We have a fund to build roads and bridges – its called the Highway Trust Fund – and it is funded through gas and vehicle sales taxes. Revenues are stalling, no doubt. People have been driving less since 2004 as gas prices have risen and the economy has dived. Vehicle sales are currently sluggish.
But have no illusions that this is a problem solely caused by revenues, no matter what rural legislators in our transportation committees consistently say. The primary problem that has prompted the policy drive-by that is the Mobility Fund is we spend our precious Highway Trust Fund dollars according to an ‘equity’ formula that reflects the contours of political power in the late 1980s rather than the transportation needs of today.
The Highway Trust Fund was created in 1989 and was the result of an intense horse-trading carve-up of transportation revenues designed to get the bill passed. Subsequently, money is spread around and spent on legislatively mandated four-lane projects in rural areas like it comes from a bottomless well. That’s fine when times are fat, the roads look OK. But not today.
Despite the multiple objections to the equity formula aired at a recent Transportation Oversight meeting by transportation planners, Mayors, umbrella organizations, interest groups and policy wonks the legislators with the hand on the transportation policy tiller continue to deny the problem. Make the revenue pie bigger and all will be OK, they say.
This instinct flies in the face of what is happening in every other part of state government. As every department and policy area is looking for efficiencies, to reduce redundancies, to get more out of what we have, the transportation crowd refuses to bite the bullet on budget priorities. It all seems too hard.
So it’s business as usual. New name – Mobility Fund – same game. The Trust Fund remains untouched. Never mind that traffic on rural arterial roads actually declined by around 25% between 2004 and 2008. Never mind that we can’t actually look after the investments we have and that one in six bridges are structurally deficient (worse than national average) or that over a quarter of our lane miles on major roads are rated as poor or mediocre (i.e. in need of repair now or very soon). Never mind that interstates are groaning under increased traffic or that congestion in metro areas continues to grow at an alarming rate. Never mind that we continue to woefully underfund bus and rail options.
Add in the fact that the state is also responsible for building small county roads – and maintaining them – and the conclusion is easy. Fix the spending priorities we have before adding any new fund.
As the kicker, by taking DMV fees increases and using them for major logistics construction, the Governor has crowded out the capacity of the state to accelerate the maintenance schedule. DMV fees at present go into the Highway Fund, which is used to patch roads and bridges. Next time you hit a pothole on the way to work, think about that and the Rolls Royce roads with nary a car on them.
Governor Proposes NC Mobility Fund
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
