In This Issue

	Bush Puts $ into Congestion Tolls
	Turnpike Toll Elimination Plan Appears Dead
	Va. Senate Cuts Transportation Bill
	Highways are Biggest Priority in DOT Budget
	Atlanta Chamber Ready to Push Tax Referendum
	NH State Transportation Leader Resigns
	Gov. Pushes Transportation Reform
	Indiana Paves Way for Privatizing Toll Roads
	Group Explores New Ways to Fund Roads
	Bill Allows N.J. to Seek Bids for Privatization

Bush Puts $ into Congestion Tolls

WASHINGTON – President Bush is embracing a new cause in his new annual budget released this week: easing rush hour congestion. In his highway “congestion initiative” Mr. Bush includes grants for state and local governments to experiment with anti-crowding strategies and congestion pricing.

Beginning this spring, the administration will grant $130 million to cities and states to build electronic toll systems, which would charge drivers fees for traveling in and out of metro areas during peak travel times. The money can also be used for other overcrowding relief methods such as expanded telecommuting, but the White House believes congestion pricing is the most viable option. The administration also plans to request an additional $175 million for congestion programs in next year’s budget.

U.S. DOT officials expect at least 10 major cities to apply for the funding before the April deadline. Congestion pricing has already proved extremely successful in Europe, as U.S. officials were motivated by London’s congestion pricing system instituted three years ago. Stockholm voters also approved a similar system last September, after testing the plan last summer.

Transportation Secretary Mary Peters said travel congestion is “increasingly troubling. It’s a cost to business and probably affects our ability to be competitive on the global market. But it’s also something that just drives people crazy.”

Turnpike Toll Elimination Plan Appears Dead

BOSTON – A proposal to discontinue tolls on the Massachusetts Turnpike west of Route 128 appears to be off the table after meeting stiff opposition from Governor Deval Patrick. Board members reported that the governor does not support removing the tolls, and the board would not move forward without his support.

“There’s no plan to move forward with this in the foreseeable future,” said Turnpike spokesman Jon Carlisle.

Patrick, who has veto power over the plan, calls it an “impractical idea.” After looking over financial briefings, the Democratic governor said he was convinced that the road cannot be properly maintained without the $114 million in revenue generated by the tolls. Several board members suggested raising the gas tax to make up for the lost toll revenue, but the governor said he is against that option as well.

The board will no longer hold public hearings on the issue. The Turnpike board presented the idea of eliminating tolls on the 123-mile section of highway at an October meeting.

Va. Senate Cuts Transportation Bill

Virginia – Virginia’s Senate sent a transportation funding bill to committee Tuesday, essentially killing it for the session. There was intense debate in committee last week about Senate Bill 1379, which would impose a 5 percent tax on wholesale gasoline sales to help finance road construction and maintenance. The Senate Finance Committee had approved the bill with a 9-6 vote, which appeared to be heading toward a close vote on the Senate floor.

However, the bill’s sponsor, Sen. Russell Potts, R-Winchester, requested its return to committee for the sake of collegiality, on the last day the Senate or House can approve its own legislation. So the bill is doomed.

The House of Delegates is still considering the Republican compromise, which includes a $10 increase on vehicle registration fees, a 1.5 percent increase on diesel fuel sales, incurring up to $2 billion in debt to finance road construction, and an increase in traffic violation fines. The body has bitterly divided recently over the transportation debate.

“We now await our friends in the House in sending a bill over,” Potts said. “It’s been said many times that if in fact we have a solution, then the House of Delegates must be a part of that solution. I am very optimistic and hopeful we will see a measure come from the House that this body can vote on. I also urge the governor to send us a bill to help remedy the crisis.”

Highways are Biggest Priority in DOT Budget

Washington, DC – Over half of the U.S. DOT’s $67 billion budget will go to highway safety and construction programs, as outlined by U.S. Transportation Secretary Mary E. Peters for the agency’s 2008 fiscal year via teleconference on Feb. 5. With a projected $230 million shortfall in the fuel-tax dependent Highway Trust fund by the end of fiscal year 2009, Secretary Peters plans to dedicate $42 billion to highways.

The Congestions Relief Initiative announced last spring will receive less than one percent of that - $175 million – mainly on an administrative effort to study ideas such as public-private partnerships in transportation construction. The congestion package includes $25 million to execute the Corridors of the Future program which promotes public-private partnerships across state lines.

Secretary Peters is a proponent of congestion pricing, with varying tolls based on peak travel times, for more consistent pricing and better use of the system. The DOT budget is only 2.3 percent of the $2.9 trillion budget President Bush sent to Congress Feb. 5.

The full 76-page DOT’s Budget in Brief is available as a pdf download at http://www.dot.gov/bib2008/pdf/bib2008.pdf

Atlanta Chamber Ready to Push Tax Referendum

ATLANTA – A bill to allow Atlanta metro region voters to vote on a penny sales tax for transportation could be presented to the Georgia Capitol as early as next week, according to Metro Atlanta Chamber of Commerce President Sam Williams. Up to $10 billion could be raised by the tax in ten years, said Williams.

The chamber has been working for several years on a metro-wide plan to bring relief to Atlanta’s growing traffic problems. Republican legislators in the Georgia House of Representatives hope to introduce legislation which would allow the five major counties in the metro area to have a transportation infrastructure tax referendum by the end of 2010.

Williams acknowledged that even if the sales tax is approved, it will be eight years before there is noticeable traffic relief. The money is desperately needed because, while Georgia is the fourth fasting growing state, it is fourth-to-last in transportation spending. It also has the lowest gas tax except for Alaska.

The Georgia Department of Transportation has recently reported that it needs $340 billion for completion of transportation projects through 2035, but expects to bring in only half of that in revenue.

NH State Transportation Leader Resigns

CONCORD – New Hampshire Transportation Commissioner Carol Murray has come to an agreement with the attorney general’s office that will result in her March first resignation, Murray’s attorney reported Monday. The agreement was the outcome of several weeks of discussions between Gov. John Lynch’s office and the law firm of Douglas, Leonard and Garvey, who is representing Murray.

Murray said of her 30 plus years at the DOT: “I have always been proud to be a part of this department, whether it was as a college intern in 1974 or as commissioner since 2001.”

“I thank Commissioner Murray for her years of service to the people of New Hampshire,” Lynch said in a statement. He said the interim leadership for the department would be announced shortly. Lynch has said he was concerned about the financial and operational management of the agency after a July 2006 Legislative Budget Assistant’s Office audit of the agency found 30 deficiencies at DOT. Issues included improper accounting, incorrect statements for the E-ZPass toll road system, and problematic turnpike fund accounting.

Carol has done a great job as commissioner and has been a stalwart in the AASHTO world. She, along with Susan Martinovich (NV), Deb Miller (KS), Betty Mabry (SC), Pam Lowe (ID), Marci Matthews (KY), and Mary Peters (AZ) have collectively broken the glass ceiling-paving the way for other women to fill CEO roles throughout the country. TW

Gov. Pushes Transportation Reform

S.C. - Gov. Mark Sanford of South Carolina was not able to win legislative approval to move the state DOT under his control, but the executive director of the Department of Transportation, Elizabeth Mabry, has resigned after a state audit raised criticism. Sanford had previously criticized her administration of the state agency, which has a $1.3 billion annual budget.

The DOT has also announced it is delaying plans to build a controversial $150 million bridge over Lake Marion. Sanford has not wanted to build the bridge, because he disagreed with department reasons for construction: to help the local economy. The governor believes improving traffic conditions should be the primary reason for such a project. Conservation groups, one of the governor’s most solid bases of support, agree with the governor’s agenda to make transportation a Cabinet agency.

Some observers say Sanford still has a minimal level of direct control over decisions made by the department of transportation. Many attribute the current legislative push to restructure the agency to Sanford’s prodding and his appointee for head of the department’s commission, Tee Hooper. Sanford wants to reform the agency, but lawmakers working on Transportation Department legislation say they are not likely to turn control of the agency over to the governor.

Sanford recently said he was not satisfied with the discussions regarding the Transportation Department reform; he wants more change. “It’s not a question of getting the message out. I think people get it,” he said. “We’ve still got a long way to go.”

Indiana Paves Way for Privatizing Toll Roads

Indiana - Pennsylvania Gov. Ed Rendell and 200 legislators from across the nation will gather this week to discuss the issue of privatizing public assets with one of the forerunners in the U.S. for leasing toll roads, Indiana Gov. Mitch Daniels. Many government leaders and lawmakers throughout the nation are intrigued by the way Daniels has uncovered new sources of revenue by leasing the 157-mile Indiana Toll Road for $3.85 billion.

Daniels has admitted raising taxes was never considered to raise the $2 billion needed for the state’s critical road improvement plans, or the $200 million annually for improved college funding. “I believe in solving problems without raising taxes,” he said.

Daniels says he took note of Chicago Mayor Richard Daley’s lease of the Chicago Skyway in 2005, and, knew time was of the essence. He worried private capital could run out if other states put their roads on the market, so he waited through his first legislative session, then presented his idea during the 2006 session. It was approved with only two democratic votes.

Rendell, a democrat, recently asked for statements of interest from the investment community for a leasing deal for the over 500 miles of the Pennsylvania Turnpike. Forty-eight agencies expressed interest. “Obviously, Indiana has really opened up a lot of people’s eyes,” said Pennsylvania DOT spokesperson, Rich Kirkpatrick.

Group Explores New Ways to Fund Roads

DENVER - A regional task force in the Denver area is exploring different taxes as options to pay for a projected $25 billion shortfall for road and transit construction for the nine-county region over the next two decades. The Denver Regional Council of Governments has been considering options for months, such as taxing all Colorado drivers a penny for each mile they drive, in addition to the current gas tax. The DRCOG’s analysis estimated this “vehicle-miles-traveled user fee” (VMT) would raise an extra $400 million annually.

Regional Transportation District regional manager Cal Marsella, a member of the DRCOG panel said the VMT tax could vary for fuel efficient vehicles. For instance, a driver of a Toyota Prius would be charged 1 cent per mile - $100 if they drove 10,000 miles a year- and drivers of a much less fuel efficient SUV would be charged 5 cents per mile, or $500 for the same annual mileage. A VMT tax could be charged to motorists when they report their annual mileage during the auto-registration process.

Critics of the plan say that the VMT tax would penalize commuters in the more rural parts of the state, who typically have to drive longer distances and have fewer transit options.

The DRCOG estimates that raising the gas tax, currently at 22-cents-per-gallon, by one penny, and basing other future increases on inflation, would raise approximately $24 million a year. The regional government group said that a much larger tax hike would be needed to cover the shortfall, and voters would likely not approve a high increase.

Those who advocate a gas tax increase as the singular solution to the huge transportation shortfalls in a given state need to face the realities of that revenue stream-it is not only inelastic-meaning its value declines over time, but it also raises so little money for so much pain to the public. $24 million per penny in Colorado doesn’t come close to meeting their needs. In most states a nickel covers only a fraction of what is needed. TW

Bill Allows N.J. to Seek Bids for Privatization

TRENTON, NJ – A bill that would allow New Jersey to seek bids to lease the two of the state’s largest toll roads will be introduced to lawmakers next week. The legislation, proposed by Sen. Raymond J. Lesniak, D-Union, would allow the state treasurer to solicit bids for the 75-year lease of New Jersey Turnpike and the Garden State Parkway. The bill would also allow the New Jersey Turnpike Authority to bid.

The state could gain $10 billion to $15 billion for debt reduction, while the private consortium would collect all toll revenue, which could be increased annually. “This bill will be a certain non-starter in the General Assembly unless it contains stronger protections against prospective runaway toll increases,” said Assembly Majority Leader Bonnie Watson Coleman, D-Mercer. Lesniak said one of the proponents of the bill was that the hikes are capped by inflation rates and are predictable, a major difference from other states who have experienced dramatic toll increases since privatizing their roads.

Some fellow lawmakers still warned against giving up state assets. “It’s not free money,” said Assemblyman John Wisniewski, D-Middlesex, chairman of the transportation committee. “It’s money that has to be paid back. And it gets paid back by the people of this state who use our transportation infrastructure. It gets paid back over an extraordinarily long time.”