Flat gas-tax revenue leaves Colorado roads unfixed
The Associated Press
Aspen, CO Colorado
DENVER ” It was “non-negotiable, an absolute must.”
Colorado needed to find $500 million a year to fix and maintain its crumbling roads and bridges. Building new roads and adding transit to ease congestion would cost another $1 billion, according to a governor’s task force. That was before the Legislative session that ended last week.
Despite lawmaker warnings that Colorado is playing “structurally deficient bridge roulette”, the Democratic-controlled Legislature and Gov. Bill Ritter didn’t find a solution.
Democrats and Republicans were quick to fix blame for the failure of a “fix it first” plan that would have raised $300 million at most. That did nothing to change the statistics:
Colorado has one of the highest state gasoline taxes in the nation. But 17 percent of its bridges don’t meet current design standards or have significant deterioration.
Forty-one percent of Colorado’s roads are in poor condition, and 20 percent have to be replaced because there’s not enough left to be repaired.
Legislators criticized each other for a lack of political will.
Majority Democrats said election year politics bogged down efforts to raise car registration fees and rental car taxes, which don’t require voter approval. They blamed Republicans for not cooperating.
Republicans, traditional backers of transportation funding, criticized Democrats for not truly negotiating with them and not finding money within the state’s $17.6 billion budget. They cited approval of education funding that was $113 million above what is constitutionally required, 1,300 new state positions, and $2 million to subsidize home solar panel installations.
The school funding, in part, will pay for more children to go to preschool and kindergarten and provide more kindergarten classrooms. About half of the new state employees will be paid for with user fees, rather than tax dollars, and about 300 of them are prison guards.
Senate Minority Leader Andy McElhany said Democrats backed away from a fee increase because they realize that voters “think like Republicans.” Ritter acknowledged concerns among Democrats that Republicans could campaign against them this fall on the issue of fee hikes.
McElhany said he and House GOP leader Mike May told Ritter that all kinds of fee and tax increases were on the table. He said he gave up when Ritter refused to back a constitutional amendment requiring that the money be used for roads.
Ritter spokesman Evan Dreyer said the constitution already has too many conflicting spending mandates. He said Ritter offered to protect a stream of money into transportation once the rest of the budget was funded but never heard from the GOP.
Republicans also proposed taking constitutionally-required funding increases for education under Amendment 23 and shifting them to transportation when that provision of the amendment expires in 2010.
Those familiar with the state’s confusing budget formulas and restrictions say the problem has been a long time in the making and that it would be nearly impossible to cobble together enough cuts each year ” and get lawmakers to agree on them ” for Colorado’s roads without some kind of tax or fee increase.
The bulk of Colorado’s highway funding comes from the state’s 22-cent per gallon gasoline tax, along with taxes and fees from vehicle registrations and usage taxes. In good economic years, once the state’s budget grows up to the maximum 6 percent limit allowed by law, extra money can flow into state construction projects, including highways and bridges.
Next year, largely due to the weakening economy, there will only be $130 million in that “spillover,” and the federal government will contribute $87 million less than the current fiscal year. That means there will be $925 million for maintaining and building roads, about 28 percent less than the $1.3 billion for the fiscal year that ends June 30. The gasoline tax ” the nation’s 22nd highest ” doesn’t increase with the price of gas and revenue has slowed because vehicle fuel efficiency has been increasing. But the cost of materials to fix roads and bridges has increased at about 6 percent a year as world demand for steel, concrete and asphalt grows, said Heather Copp, chief financial officer for the Colorado Department of Transportation.
“We’re fighting this uphill battle all the time,” she said.
Other states are struggling with stagnant revenue and declining federal funding. In Virginia, lawmakers plan a special session next month to deal with road funding. There are no plans to do that in Colorado.
Former Republican state Rep. Brad Young, who served on the budget committee, said Colorado’s tax base and strict spending limits play a big role. The Taxpayers Bill of Rights, which took effect in 1992, limits the amount of taxes the government can take in to a formula based on population growth and inflation. Anything above that amount must be refunded to taxpayers, a provision which voters agreed to suspend for five years in 2005.
In the late 1990s the state was taking in so much money only to refund it later under TABOR that lawmakers decided to lower the income tax rate from 5 percent to the current 4.63 percent in 2000. Young said the $3 billion that was refunded over a five-year period could have gone to transportation.
After recession hit in 2001, there wasn’t any extra money for transportation projects. Colorado continued building roads, including the widening of Interstate 25 in metro Denver and 28 other projects, based on earlier borrowing. But that bonding authority has been exhausted.
Nearly a fifth of next year’s $925 million transportation budget will go to those bond payments, Copp said.
“Without a new source of revenues, I think that transportation will still be lacking,” Young said.
Bob Tointon, a Republican who served on Ritter’s task force and former president of a concrete and jail equipment manufacturer in Greeley, said warnings about bridge “roulette” is more rhetoric than reality. If a bridge is structurally deficient, he said, the state will first decrease weight lim-its, or just close it.
Tointon says the state’s real problem is more mundane. The longer it waits to fix its roads and bridges, the more expensive the work will be.
“I’m just concerned the deterioration is about to accelerate,” Tointon said.
After November’s election is done, Tointon hopes lawmakers can agree on a plan next year and possibly send some kind of tax increase to voters.
Senate President Peter Groff (D-Denver) hopes to come up with a proposal next year that would be the first bill introduced in the Senate.
“Understand that my caucus is ready to do that,” he said.
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