Friday, March 28, 2003

Mike Krusee: "I haven’t seen any concern at all from rural areas."

In his own words: House Transportation Chairman Mike Krusee


by David Guenthner

The Lone Star Report
Volume 7, Issue 28
Copyright 2003

Make no mistake: Texas needs additional transportation infrastructure. But the existing state funding isn’t adequate to keep up with the needs and the prospects for additional state funding given the current budget crisis are non-existent.

That means that lawmakers will have to come up with some creative methods to put that infrastructure in place. This week, LSR sat down with House Transportation Chairman Mike Krusee (R-Round Rock) to get an update on some of the concepts on which he is working.

LSR: You’ve proposed a series of bills dealing with regional mobility authorities. Talk a little about what is in those.

Krusee: They empower regions in the state to address their transportation needs somewhat independently of [the Texas Department of Transportation (TxDOT)]. They grant condemnation and bonding authority, specifically. We’re also seeking to broaden their powers so that they can address transportation needs in a multi-modal fashion – allowing RMA’s to do freight rail, commuter rail, even airports. They have similar powers to the Trans Texas Corridor.

LSR: Most of the tools necessary to implement the Trans Texas Corridor were passed into law last session. What else will the Legislature need to do this session to fully implement it?

Krusee: TxDOT does not currently have authority to do freight rail. This bill would allow them to do that. TxDOT does not now have authority to do what we call “corridor participation payments” – sometimes they’re called royalty payments for right-of-way acquisition. And it grants TxDOT additional exclusive development authority powers. I don’t think that TxDOT can now charge for easements – water, transmission lines, telecom, pipelines, that sort of thing. This bill will allow them to do that with a willing partner – not force people to pay but enter into an agreement. Those are some of the main things.

LSR: During the last campaign, there was a lot of misunderstanding or misinformation about the amount of money it would cost the state to implement the Trans Texas Corridor. Most of the financing was envisioned as coming from exclusive development agreements and the private sector. Exactly how much state financial participation is it going to take to make these corridors happen?

Krusee: We don’t know until we receive proposals from the private sector, and that’s the reason we want to keep Trans Texas Corridor legislation flexible. There is a political limit to how much in state funds TxDOT can use on the Trans Texas Corridor, because if we start to siphon off badly needed funds from metropolitan areas, there will be political resistance, and the Trans Texas Corridor will fail.

LSR: The governor’s original proposal was to do 4,000 miles of Trans Texas Corridors over 50 years, but the proposals so far seem to be focused along a route parallel to IH-35. Is that original vision being scaled back?

Krusee: I’d assume there are no proposals you’re seeing yet. But the Trans Texas Corridor is not a set of lines on a map. It’s not a drawing showing all the possible modes of transportation. The illustrations are meant to show what is possible, not what we want to happen. There is no model. There is no line on a map. Trans Texas Corridor is more a frame of mind than a blueprint.

LSR: A number of lawmakers are floating ideas for bonding or short-term borrowing to finance transportation infrastructure. Are there any of the proposals out there that make sense to you?

Krusee: Almost all of the bonding proposals make sense to me. I haven’t seen a bad one. It’s a very good time to be borrowing money, given the rate of inflation in construction costs and the opportunity costs of not having that infrastructure in place now – the economic development we lose, and therefore the revenue to the state we lose, the jobs we lose. So if bonding allows us to put that infrastructure on earlier, construction inflation alone, not considering the opportunity cost, more than covers the interest payments.

What Sen. Ogden and I have been exploring is pursuing bonding in the most straightforward way possible, and that is to do a multi-billion dollar [general obligation] bond package. Sen. Ogden has had hearings on that in the Senate. We’ll have them in the House. That may be the most straightforward way to go.

LSR: Last session, there was a proposal for a nickel increase in the gasoline tax. It doesn’t look as though that is going anywhere this session. How long do you think we’ll be able to stay with our current gas tax, or will we need to look at an increase in future sessions?

Krusee: We will go this session without increasing the gas tax. However, we may explore giving local regions such as RMA’s and [regional transportation authorities] a local option gas tax, which would require a vote of the region to implement.

I think we’re first going to have to address school finance – which will force the state to address its entire tax structure – before we start thinking about whether we need a gas tax increase in the future. If we were able to lessen the diversions from Fund 006 to education by making up for it somewhere else, then we wouldn’t have to increase the gas tax. If we just use the gas tax revenue and the motor vehicle registration revenue for its intended purpose – for transportation – then we wouldn’t have to increase the tax.

LSR: Are there any ideas for funding the Texas Mobility Fund this session?

Krusee: There will be a proposal to fund the Texas Mobility Fund, and I think we will be successful. We’re still working on what that will be. You can increase taxes. You can increase fees. You can increase fines. And the question will be, which one of those is most attractive and is it attractive enough?

LSR: Are rural members raising concerns about being left behind on transportation issues, given the focus on the Trans Texas Corridor and regional mobility authorities?

Krusee: The Trans Texas Corridor goes largely through rural areas, so, no, I haven’t seen any concern at all from rural areas. I think many rural areas of the state – for example, East Texas – are very hopeful the Trans Texas Corridor will be placed ... through their areas.

LSR: What are the prospects for coming up with a coherent system of transportation finance, where transportation fees and the like are used for transportation purposes? Do you think we’ll ever fully get there?

Krusee: I think the school finance crisis gives us an opportunity to address that. I think we should make an effort for there to be a much more direct relationship between the taxes and fees we pay and transportation. O

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