In This Issue

	Transportation Finance Options for States
	Wis. Gov. Wants to Tax Oil Companies $1.50/Barrel
	ND Studies Salt Water Used as De-Icer
	Bill Suggests Widening Maine Turnpike
	Viaduct Expert Panel Resigns
	Oklahoma Highways have a Brighter Future
	Oregon Sells Lottery Bonds to Pay for Roads
	$1B Prairie Parkway Still Set to Begin
	Gov. Holds Fate of Huge Toll Road Plan
	Seattle’s Viaduct Distracts, Infuriates Lawmakers

Transportation Finance Options for States

WASHINGTON – Indiana Gov. Mitch Daniels and Pennsylvania Gov. Edward Rendell released a new issue brief from the National Governor’s Association Center for Best Practices (NGA Center) examining the transportation finance challenges faced by states and outlining the tools available to address them. The brief says that states are facing numerous critical transportation issues, such as finding sufficient resources to finance all of their transportation needs.

An estimated $222 billion is needed annually through public investment for highways and transit to maintain our current surface transportation system, with an additional $288 billion in public investment to advance the system to a level that enhances the nation’s productivity, according to a recent study by the National Chamber Foundation of the U.S. Chamber of Commerce.

The brief suggests many strategies that can be pursued alone or in combination with taxes, pricing, and demand-side solutions as part of a comprehensive financing structure, including: Tax-based approaches to increase revenue, toll and road pricing systems to raise revenue, debt financing to reduce project development costs, asset leases to raise revenues, creating more effective partnerships with local governments, and reducing long-term growth in highway and travel demand.

“State leaders are faced with the daunting challenge of maintaining and improving our nation’s infrastructure with limited resources,” said John Thomasian, director of the NGA Center. “This issue brief offers options to help governors finance the operation, maintenance, integration and future growth of the national transportation network.”

To view the full pdf version of the issue brief: http://www.nga.org/Files/pdf/0702TRANSPORTATION.PDF

Its great to see the Governors getting the message out about the funding crisis in transportation. They were helpful in the passage of TEA-21. Perhaps they will help with the current efforts. 2009 isn’t that far away in “reauthorization time.” TW

Wis. Gov. Wants to Tax Oil Companies $1.50/Barrel

MADISON, Wis. – Wisconsin Gov. Jim Doyle has proposed taxing big oil companies $1.50 on each barrel of oil sold in the state over the next two years to help fund state transportation projects. The governor said the tax would raise over $270 million over the two year period and oil companies would be prohibited from passing the tax on to drivers at the pumps.

“This is not the total solution but this is a significant part of it,” said Doyle. The proposal was part of the two-year budget he delivered to the Legislature Tuesday, which also included a planned increase in vehicle registration fees. New Jersey, New York, Pennsylvania, and Connecticut have similar assessments on oil companies in place.

Todd Berry, president of the nonpartisan Wisconsin Taxpayers Alliance, blames democrat Doyle for the transportation deficit, saying the administration used $1.1 billion from the transportation fund to balance the state budget. A spokesperson for the oil industry said the companies plan to lobby heavily against the proposal, which he said is a veiled way to raise the gasoline tax.

ND Studies Salt Water Used as De-Icer

N. Dakota - North Dakota officials are expanding its sampling of the salt water used as a deicer on state roads to determine its level of contamination, according to the Health Department. The director of the Health Department’s environmental health section, Dave Glatt, said authorities are investigating whether the state violated its own laws by spraying the saltwater remaining from oil production on some state roads over the last 40 years.

The state DOT halted the longtime practice of using the leftover oil well water after Health officials were informed of it last week. North Dakota’s Industrial Commission, which controls oil and gas regulation, is investigating the practice. The Health Department is performing tests on saltwater samples, but tests on samples from several wells from the states oil patches will likely not be complete until this summer, said Glatt.

Oil companies have given the oil well wastewater to the state for free, which they otherwise would have to pay to dispose in underground wells. Transportation officials reported that tens of thousands of gallons of the wastewater has been applied annually to North Dakota roads.

Bill Suggests Widening Maine Turnpike

PORTLAND, Maine – The Maine Legislature is considering a bill to widen the Maine Turnpike from four to six lanes from Scarborough to Falmouth. The Maine Turnpike Authority still must prove that no sufficient alternatives exist to solve the congestion problem on the 8.7 mile stretch of corridor other than the proposed widening for the project to move forward.

If approved, the expansion will be financed through a toll increase; construction would begin in 2010. The Maine Turnpike Authority estimates the cost to be $75 million for the widening and $75 million for bridge upgrades and other improvements.

Another bill under consideration is designed to relieve congestion on I-295, which would be a joint effort for the Maine DOT and the turnpike authority to develop “tolling strategies” to provide incentives for trucks to use the turnpike rather than I-295. One of the key goals of the legislation is for the Maine Turnpike Authority and the transportation department to work together and look at the roads as a whole instead of separately. The authority must receive approval from the legislature for numerous items, but does use state revenue.

Viaduct Expert Panel Resigns

SEATTLE – An independent Expert Review Panel called into Seattle to examine a four-lane Alaskan Way tunnel and other alternatives for the waterfront called it quits last Friday, saying there was not enough time to do a proper analysis. The panel, appointed by Gov. Christine Gregoire and legislative committee leaders to study the Viaduct and Highway 520 last summer, was called back in and given a Tuesday deadline to give the public answers to several questions, including whether the city government’s cost estimate of $3.4 billion for a four-lane tunnel is accurate.

“We decided that time is too short for us to do anything meaningful,” said panelist Don Forbes, a former Oregon transportation director. The state Department of Transportation project team briefed four of the eight panelists last week, but Forbes says there was minimal new information since the state halted the brief tunnel review in January.

City voters will be mailed advisory ballots Feb. 21-23. Voters will weigh in on whether the aging Alaskan Way Viaduct should be replaced with a tunnel, or a less-costly elevated structure without the benefit of advice from the experts. Mayor Greg Nickels recently proposed a four-lane tunnel, which he says would save $1.2 billion in comparison to the original, six-lane tunnel option.

Oklahoma Highways have a Brighter Future

OKLAHOMA CITY – Oklahoma transportation commissioners approved an eight-year plan last week that will help improve the state’s interstates which have badly deteriorated in recent years. Among the many planned improvements are bridge replacements, adding shoulders to two-lane highways, and installing median barriers on many sections of interstate.

“This, by far, exceeds anything that’s been done before,” said Ridley, director of the Oklahoma Department of Transportation. “Interstates are our life’s blood and we need to keep them healthy. In years past we have not.” Ridley says Oklahoma’s highway and bridge system is among the worst in the nation, but he hopes to change this with the new plan.

The legislature increased funding for transportation last year. If the general fund grows by 3 percent each year until 2011, the Department of Transportation will increase their funding from the current $200 million up to eventually $470 million by 2011. Ridley says he is still budgeting conservatively since the financial stability of the department partially relies on the state’s economic growth.

Oregon Sells Lottery Bonds to Pay for Roads

SALEM – Oregon Gov. Ted Kulongoski recently announced that the state has issued $153.6 million in lottery revenue bonds to pay for important projects in transportation, maintenance facilities on state university campuses, and economic development.

“Today’s action is an exciting example of how Oregon is investing in its future,” said Governor Kulongoski. “These bonds will help Oregon become more competitive by strengthening our transportation system and our education system, while creating new jobs and new opportunities for thousands of Oregonians.”

“ConnectOregon,” the governor’s program to upgrade ports, rail facilities, airports, and other non-highway projects around the state will receive about $72.1 million of the bonds. This bond issue signifies the second and final installment of the $100 million ConnectOregon for this biennium. About $20 million will go to infrastructure and $35.4 million to finance the 15-mile commuter rail line in Washington County, which is expected to reduce traffic in the Portland area.

$1B Prairie Parkway Still Set to Begin

YORKVILLE, Illinois – Illinois still plans to begin work on the $1 billion Prairie Parkway as early as 2009, despite state official’s postponement of choosing a final route. Farmland and water protection concerns have delayed the decision which the Illinois Department of Transportation now expects to make in late spring.

The state department of agriculture prefers a longer route, known as B-5 for the four-lane highway, which will connect Interstate 88 in Kane County with Interstate 80 in Grundy County. The department is primarily concerned with the loss of prime farmland and the impact on agricultural areas. The B-5 route would run from near Kaneville south to Yorkville and then veer east and end near Minooka.

The other possible route, B-2, would also start near Kaneville but end close to Morris, and require the conversion of more acres of farmland, according to Department of Agriculture spokesman Jeff Squibb. The agency plans to submit a report to the transportation department in support of the B-5 route.

The B-5 route also appears to be favored by local leaders because it runs through areas planned for development and offers a close commute to jobs. The Department of Transportation plans to consider input on the proposed routes from the Federal Environmental Protection Agency and the U.S. Army Corps. of Engineers before making a final decision.

Gov. Holds Fate of Huge Toll Road Plan

TAMPA – The fate of possibly the most massive, expensive transportation project in Florida’s history lies in the hands of new Governor Charlie Crist. The “Future Corridors” project plan is comprised of nine separate routes that would criss-cross over more than 1,000 miles of Florida’s countryside. Gov. Crist has yet to take a stand on the project, which critics say would pave over much of the state’s rural landscape.

Former Gov. Jeb Bush supported the plan, which was called a “significant milestone” the state should pursue by former DOT Secretary Denver Stutler. The project is still in the planning stages, but supporters believe it is an essential and practical move that will support Florida in the next 50 years of growth.

The Florida Transportation Commission, whose nine members are governor-appointed, also supports the plan, which is slated to be financed by the increasingly popular public-private partnerships. Before leaving his post Jan. 2, Stutler outlined how the project should move forward in a Future Corridors “action plan.” State officials say they are using Stutler’s action plan as a guide for planning Future Corridors until they hear otherwise. Some believe the best indication of the governor’s position will be who he appoints to replace Stutler.

“We believe that planning future corridors is not just a transportation issue,” said Stutler in a Dec. 29 letter to Bush. “It’s really about our future quality of life, the competitiveness of our economy, and the sustainability of our environment.”

Seattle’s Viaduct Distracts, Infuriates Lawmakers

OLYMPIA, Wash. – The multibillion-dollar issue of the earthquake-damaged Alaskan Way Viaduct has turned what should have been an easy legislative year, with Democratic domination and a large surplus, into an agonizing mess for the governor and lawmakers.

Gregoire has said lawmakers, a third of the way through their session, are clearly distracted. She says the Seattle vote on March 13 may not solve anything, but lawmakers cannot leave without a plan. “What I will not do is sit her and do nothing. By mid-2007 we need a decision and start construction in 2008,” Gregoire said. “Shame on all of us if we do nothing.”

House Speaker Frank Chopp, D-Seattle, believes the $3.4 billion tunnel option is much too expensive and said it is practically a dead issue in the Legislature. Chopp has also reported that he can only count on the eight pro-tunnel members in the 98-member House. “They can agonize and want to do it, but when fiscal reality hits, you just can’t do it,” he said. “When something is not feasible, you don’t do it.”

Seattle Mayor Greg Nickels and most of the City Council are in favor of the tunnel, as opposed to the less-expensive, $2.8 billion rebuild option, which Nickels says divides the waterfront from the city. The dilemma has left Governor Christine Gregoire caught in the middle between the Mayor of Seattle and the Speaker of the House.

This is a very difficult situation for all involved. The Governor is trying to do the right thing but two very polarized groups have opposing views and aren’t showing any inclination of compromise. She is right about getting the project going. Just the simple inflation costs impacting construction amount to anywhere from $200-300 million a year depending on the option that is finally built. Time was when most folks didn’t worry about the cost of delaying a project. Today, the impacts are staggering and demand action. TW