Posted by: sweeneyblog | December 16, 2013

Policy Junkie: Transportation a key issue for 2014

Today’s article combines some recent news with a deeper look at the state of transportation funding in Washington, courtesy of the Policy Junkie.

While Governor Inslee attempted to raise the stakes of a new transportation package by including it in the Boeing 777x gambit of November 2013 (i.e. the most recent special legislative session), no deal has been reached yet.

Tim Sweeney is The Policy Junkie

Tim Sweeney is The Policy Junkie

The big breakthrough was when the Senate Majority Caucus, otherwise known as the Republican caucus with two self-described Democrats, put forth a set of proposals that included a gas tax increase higher than what was proposed by the state House of Representatives earlier in the year. That’s right, the Republicans suggested a higher tax than the Democrats. But despite Governor Inslee’s offer to conduct another special session if a transportation agreement can be reached, it’s looking increasingly like this issue will be held over for the next regular session which starts in January 2014.

In this moment of reflection, here are some basics on the transportation issue.

How much do we pay in gas tax?

The price of a gallon of gas in Washington includes 56 cents in taxes. 18.4 cents for the feds and 37.6 for Washington. The national average is 49.4 cents. Tax comparisons can be difficult since states levy different types of taxes on gasoline. For instance, Illinois, Michigan, and New York have higher total gas taxes because they apply the sales tax to gasoline.When all taxes are included, Washington has the ninth highest assessment.

When was the last increase in the gas tax?

Gas taxes were last approved in 2005 with a tax increase of 9.5 cents that was phased in between 2005 and 2008. Before that, there was a gas tax increase of five cents (the nickel increase) in 2003. Before that, there had not been a gas tax increase since 1991.

What happened to that money?

The revenues from the 2003 and 2005 tax packages were used to sell long-term bonds to underwrite 421 road projects. As of October 2013, 344 projects were finished, according to the Washington State Department of Transportation (WSDOT).

How do I benefit from transportation spending?

WA State Dept of Transportation

WA State Dept of Transportation

Broadly speaking, our state’s investments make it possible for people and goods to move from one place to another in a reasonably efficient way. An investment in freeway capacity in Everett can benefit anyone who drives that part of the I-5 corridor regardless of where they live. Still, WSDOT does perform a return on investment analysis that looks at state, federal and local investments compared to what each county contributes in the form of taxes. Based on a nine year look stretching from 2004 to 2012, for each dollar projected to be contributed by Whatcom County residents, 1.08 is projected to be returned to Whatcom through transportation investments. Skagit does even better with a $1.75 return per dollar. My county, Thurston, loses out with an 89 cent return.

What kind of projects need to happen in my area?

The most important list is the six year plan each city and county prepares and updates annually. Here’s Bellingham’s plan, which includes replacing the James Street bridge, repairing the Bay to Chestnut Street railroad overpass in preparation for the waterfront redevelopment and safe walking routes around Carl Crozier Elementary. Projects need to be on this list before they can get funded.

How much is needed to get our transportation system up to speed?

Depends on whom you talk to. The Washington State House of Representatives adopted a transportation revenue package last June that would raise the gas tax by 6.5 cents in the first year and another 4 cents the next year. Initially, the Senate Majority Caucus counter offered a no gas tax increase package. On November 21, the Senate Transportation Committee considered a package of bills  that would raise the the gas tax by 11.5 cents a gallon and generate $12.3 billion for transportation improvements across the state.

What’s the sticking point?

Usually there is disagreement over which projects should be funded. Transportation is traditionally where local politicians can showcase their influence by directing state funds to hometown projects. However, there seems to be general agreement with the latest public list. For instance, there is agreement that central Puget Sound corridor investments, particularly projects that ease freight to port facilities, need to be made. And the list has broadly distributed projects, including a widening of SR 539 from I-5 to the border.

One philosophical difference is the amount of state funding that goes toward transit. Local transit authorities have been struggling in recent years, squeezed between tighter budgets and growing ridership. Both House and Senate appear to now support providing increased taxing authority for local areas, some of which would go toward transit. This would likely take the form of local option motor vehicle excise fees (your car tab fees). But transit advocates argue its not enough.

Transportation efficiencies or budget swapping?

The Senate Majority Caucus also has proposed a series of “efficiencies,”  some of which may be a barrier to consensus. One proposal would eliminate the sales tax on transportation construction. Most other states don’t assess sales tax on public works projects. Yet most states don’t rely as heavily on the sales tax as we do in Washington to support education and general government. If these projects are eliminated from the sales tax, it would punch another $400 million hole in our state operating budget.

Another proposal would tap the state’s toxics control fund for transportation project waste water treatment. The toxics control fund is funded by a tax on petroleum, and runoff of oils from our surface streets is a major waterway pollutant. You might remember that this fund was a key political football between Sen. Ericksen and Sen. Ranker last year. On the other hand, such projects can also rightly be paid for through a gas tax and not dip into a fund intended to clean up Washington’s many contaminated sites.

Either way, transportation is top of the list of issues needing to be resolved this legislative session. Stay tuned later this week for articles from the Political Junkie about what legislation has already been proposed by the representatives from the 40th and 42nd.

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Responses

  1. Very well communicated, useful information. Thanks!
    Abe Jacobson


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