June 25, 2013
A transportation funding crisis is looming.
When the “Illinois Jobs Now” capital program approved in 2009 expires next year, the funds available for transportation-related construction is projected to decline by approximately $2 billion, the number of projects are projected to decline by two-thirds, and the number of constructions jobs will decline by well over half to fewer than 20,000 by FY 2018.
Without new funds, Illinois will have 5,000 miles of state roads classified as in bad repair. This means 1 in every 3 miles of road and one in every 10 bridges will be unacceptable. Some CTA rail lines claim 30 percent designated as “slow zones” due to poor repair. METRA trains and PACE buses are aged and in need of replacement. Likewise, the state’s commitment to CREATE is expired.
Traditional user fees are stagnant or declining while construction costs and needs for maintenance continue to grow. Because all revenues generated in 2009 were dedicated to retiring bonded indebtedness, nothing is left from that program to sustain annual “pay as you go” maintenance and repair programs or to undertake additional projects from state source funding. There is no ongoing transit bonding or stable state revenue stream for transit capital for ongoing maintenance.
In order to maintain the state’s commitment to infrastructure investment and support continued private sector economic growth, the Transportation for Illinois Coalition (TFIC) proposes an $800 million annual increase in user fees to be used solely for ongoing maintenance of transportation networks.
The TFIC proposal, as set forth in H.B. 3637 (sponsored by House Majority Leader Barbara Flynn Currie) and S.B. 2589 (sponsored by Senate Transportation Committee Chair Martin Sandoval), contains the following key provisions:
Abolishes state motor fuel tax and replaces it with a new wholesale fuels tax, increases vehicle registration and title fees, eliminates ethanol tax credit.
Replaces slow- and no-growth revenue sources with one more reflective of inflation and the economy.
Creates a steady and reliable annual revenue stream of $800 million for “pay as you go” programming that focuses on the maintenance of existing networks.
Segregates transportation-related user fee revenues into protected funds and allocates 80 percent of these new revenues to roads and bridges, CREATE and airports, and 20 percent to transit and rail.
Illinois needs to embrace stable, steady, predictable and reliable revenue streams and infrastructure building programs. The boom and bust cycle is not in anyone’s best interest.
About the author: John Henriksen is the executive director of the Illinois Association of Aggregate Producers and the chairman of the Transportation for Illinois Coalition Statehouse Committee. He can be reached at email@example.com.