Why toll roads likely to multiplyTexas leaders say we need them.....
how much is open to question.
Ben Wear, AMERICAN-STATESMAN STAFF
Spend any time around transportation leaders in the state these days and it won't be long before you hear the chapter and verse of Texas highways, a line of reasoning recited with liturgical certainty and remarkable consistency. To wit:
Texas roads are in crisis. We are able to meet just a third of our needs with the money available for transportation, and it will get worse as the system ages and gas tax revenue ebbs. Raising taxes is out of the question for now. Therefore, we must toll most new highways, and maybe some old ones, or face gridlock and economic strangulation.
Much of that line of reasoning is anchored in fact. The number of cars on Texas highways has certainly grown much faster over the past couple of decades than the length of the road system, and a well respected annual study from Texas A&M University indicates that urban commuters are spending more and more time in traffic. Revenue from the gasoline tax has been frozen in political amber at 20 cents a gallon since 1991. The state does in fact need more money for roads, and toll roads in most cases can be built much faster than highways funded a year at a time with money from the gas tax.
But open to question is the extent of that gap between our highway "needs" and the state's fiscal muscle to address the situation. Even the definition of what constitutes that unmet need -- the numbers come from a 7-year-old study -- is more of a statistical construct than a tangible toting up of specific projects.
And though toll roads would almost certainly need to be a part of the solution -- and are the only possible way to build Gov. Rick Perry's dream of a 4,000-mile, $180 billion Trans Texas Corridor -- it is also clear that turning to turnpikes as the almost exclusive option is as much a political choice as it is an imperative.
Nonetheless, that choice has been made.
Perry made it by signaling he will veto any gasoline tax increase. The Legislature made it last spring by passing a comprehensive transportation bill authored by a Central Texan, Republican State Rep. Mike Krusee of Williamson County, and carried to passage on the other side of the Capitol by that county's GOP senator, Steve Ogden of Bryan. That law in a number of ways made it easier for the Texas Department of Transportation and regional mobility authorities to create and pay for toll roads.
And the public, whether it realized it or not, cleared the way for toll roads by approving a constitutional amendment in November allowing the state to borrow up to $3 billion for roads. The ballot language didn't mention tolls, but transportation officials plan to use the approved $3 billion in conjunction with an equal amount that will be borrowed and then repaid with toll revenue.
Toll roads are coming, and in profusion. Bob Daigh, the district engineer for the Transpor- tation Department's Austin district, sometime in March will release a comprehensive and perhaps several-billion-dollar plan for attacking the Austin area's traffic problem. And that plan is certain to include toll roads beyond the five currently under construction or in the design phase.
In 10 years, an electronic toll tag on the windshield and periodic tolling charges on the credit card likely will seem as routine as a trip to the ATM.
"The state has embarked on a policy of solving its transportation gridlock problems by aggressively building roads and using tolls to pay for at least a big chunk of them," Ogden said in an interview last fall. He said taxpayers should be fully informed and have their say on specific toll proposals but not wear blinders about what's coming. "That's state policy. And I think the public needs to accept that."Money vs. miles
The numbers and personal experience for most metropolitan commuters would confirm that there is, at the very least, a yawning gap between existing traffic and the speedier trips most people want. And business leaders, most notably Michael Dell and his associates with their 1999 decision to divert some of Dell Inc.'s manufacturing to Tennessee, have put the state on notice that a friendly business environment includes dependable travel times on Texas roads.
Drivers in 2002 put 442 million miles a day on Texas highways, a 50 percent increase since 1990 and more than 103 percent since 1980. In those two-plus decades, the state's highway system -- now at 79,513 "centerline" miles -- grew just 11.3 percent. Measured in total lane-miles, growth since 1980 was 7.6 percent.
So, it's not your imagination. The roads really are more crowded.
Quantifying the shortage of money is more ticklish.
In January 1997, when the state Transportation Department did the study that is the source of the one-third-of-our-needs assertion, its annual budget was just $3.1 billion. The study concluded that to create an "optimum" highway system, Texas would need to spend $118 billion over 10 years.
The study laid out four budget scenarios. Spending an average of $3.9 billion a year, the report said, would meet just 33 percent of the agency's optimum needs. An average of $5.7 billion a year would put Texas at 48 percent of optimum and constitute a "good" transportation system. Spend $8.5 billion annually and you'd create a "superior" system, with 72 percent of needs met. To meet the optimum and create "excellence" would require $11.8 billion a year.
In the eight budget years since, the department budget has averaged $4.6 billion. Spending has been at about 40 percent of the optimum, not the commonly cited 33 percent. It also means that the state likely will fall $60 billion to $70 billion short of the 10-year ideal set in 1997. The shortfall from the "good" system, however, is more like $10 billion.
At first blush, it is difficult to look at the state Transportation Department budget over recent years and see an agency in fiscal peril. The Legislature last year allotted the agency just under $5.3 billion for the current fiscal year and $5.2 billion for fiscal 2005. That's a 102 percent increase since 1991, when the gas tax was last increased.
Since 1999, the transportation budget has grown 49 percent. By comparison, the Texas Education Agency budget has grown about 32 percent since 1999.
The growth in federal transportation funds was particularly healthy in the past decade or so, and is likely to get another boost when Congress finally passes a new surface transportation bill. Federal transportation grants to Texas have grown 134 percent since 1991 to the current $2.4 billion a year. And the more stingy of the two pending federal bills -- the Senate version -- would provide Texas on average an extra $800 million a year over six years.
That infusion alone would put the Texas budget over the $6 billion mark next year, surpassing that $5.7 billion annual figure necessary for a "good" transportation system.
In addition, the Legislature and voters last year gave transportation what amounts to a $6 billion, one-time boost. The Krusee-Ogden transportation bill will channel about $250 million a year into something called the Texas Mobility Fund, which in turn would allow the state to borrow about $3 billion. And voters in November approved Proposition 14, a constitutional amendment that will allow the agency to borrow another $3 billion and pay it back with future gas tax receipts.
So, given all that new money, how can there be a funding crisis? The problem, officials say, is that $5.3 billion doesn't go as far as it used to go.No more 'cheap stuff'
"All the cheap stuff's been built," is the blunt assessment of Bill Stockton, associate director of the Texas Transportation Institute at Texas A&M.
For its first several decades, the state highway department mostly built two-lane roads through rural Texas , buying right-of-way on the cheap. Even widening such roads to four or five lanes later wasn't prohibitively expensive. Then, when the interstate system came along in the 1950s and 1960s, the federal government in most cases provided 90 percent of the money. Those first 70,000 or so miles of Texas roads just weren't all that expensive.
But with the state and the country's accelerating growth in the last quarter century, transportation experts say, the nature of the highway system has changed. Austin, as late as 1970, had basically two expressways: Interstate-35 and U.S. 183 east of town. Now the area is criss-crossed with freeways, some of them raised on stilts and connected at interchanges by swooping "direct connect" bridges. And that's nothing compared with Houston, San Antonio and Dallas-Fort Worth, with their ever-widening spiderwebs of expressways.
Such projects add very few miles to the state system, at a very great cost.
That's how the state, in a decade when the Transportation Department had billions of dollars more to spend than before, could have added just a few thousand lane-miles to the system and failed to come close to keeping up with the growth in miles traveled by drivers.
James Bass, the department's finance director, said looking at his agency's budget growth through the typical prism of population increases and the consumer price index is the wrong way to do it. From 1992 to 2003, for instance, consumer prices went up 35 percent and Texas ' population increased 27 percent. The Transportation Department's budget growth in that period easily outpaced those two measures.
Bass said he looks instead at an index of highway construction cost inflation calculated by the Federal Highway Administration, and at the growth in vehicle-miles traveled, not population. Using those multipliers, the department has basically been treading water fiscally since 1992.
"This is what we're buying," Bass said. "We're not buying bread and milk. We're buying concrete."
And both Democratic and Republican officials agree that the state, despite all that money, hasn't bought enough concrete the past 20 years to match the emerging needs.
The foundation for financing roads in Texas and nationwide is the gas tax. Krusee and others, when they argue for turnpikes, say that foundation is crumbling, with a little help from the Legislature and voters. A fourth of the fuels tax, under a 1950s state constitutional amendment, goes to public schools. Another 12 percent -- $350 million or so this year -- goes to the Department of Public Safety.
And because of the increasing efficiency of car engines, tax revenue doesn't track with the number of vehicle-miles traveled. Cars, on average, get 26 percent better gas mileage than they did in 1978, according to the National Highway Traffic Safety Administration. Given those handicaps, gas tax revenue has still managed to increase annually because the miles driven have gone up so much.
But the rate of growth in revenue from the gas tax has slowed in the past couple of years, and Bass said it flattened out completely in the past six months. And transportation officials, while always hastening to commend the beneficial environmental effects of hybrid-electric cars, say that kind of super-efficient technology could cripple the gas tax as a funding source in just a few more years. Which brings us back to the nub of the situation.
The legislatures of the 1980s and early 1990s, faced with similar considerations, reacted by increasing the gas tax three times: from 5 cents to 10 cents in 1984, to 15 cents in 1987 and then to 20 cents in 1991. And there it has sat since then.
State Sen. Jeff Wentworth, R-San Antonio, says he has been advocating to increase the gas tax by 10 cents a gallon. That would bring the Transportation Department something close to $1 billion more each year. It would also give Texas , with a gas tax right now at the median among states, the nation's second highest gas tax. But his allies in the House, where tax bills must originate, never got any traction with the proposal.
Even a Krusee proposal last year to allow local governments, with voter approval, to raise the gas tax in their areas never got off the ground.
"And I'm the chairman of the (transportation) committee and it still went nowhere," Krusee said.
Asked why, several people pointed (figuratively) to the stately white mansion at 11th and Colorado streets.
"We had a race for governor in '02 where the overwhelming winner ran on a platform of no new taxes," Wentworth said of Perry. "If he tells us in the Legislature ahead of time, 'Hey, I'm going to veto any tax increase y'all send me,' it sort of deflates any sort of enthusiasm for that."And that leaves tolling.
Wentworth and state Rep. Pete Laney, a Hale Center Democrat who was Speaker of the House for a decade until the Republican House takeover in 2002 deposed him, both said the difference between raising money with a tax and with tolls may be mostly a matter of semantics. Both, it could be argued, are user fees generated by motorists turning the ignition key and going somewhere.
Toll revenue, however, doesn't have to be shared with the Texas Education Agency. Little of it will come from rural drivers, and using tolls could free up gasoline tax money for rural projects, giving farm- and ranch-area legislators two reasons to support them. And tolls don't go by that ugly name: tax.
Above all, Krusee and other tolling advocates say, tolls allow the entire cost of a project to be borrowed up front. So a 49-mile road such as Texas 130, the bypass under construction east of Austin, can go from design to opening in six years or so. Built in the traditional bite-at-a-time method of the state Transportation Department, the road would likely take 20 years or more to reach its southern terminus at Mustang Ridge.
Toll roads will allow Texas to catch up, advocates argue.
Toll roads' finances won't be affected by the type of engines drivers choose.
Toll roads, they say, are the only feasible option for what is, if not a full-blown crisis, at least a funding problem.
Building toll roads, as the senator said, is state policy.
We are all about to begin finding out whether that is the best policy.
By the numbers
Since the Legislature in 1991 raised the gas tax to 20 cents a gallon . . .
* The Texas Department of Transportation budget has increased 102 percent, to $5.3 billion a year.
* Miles traveled on the Texas highway system have increased 48 percent, to 442 million miles a day.
* The cost of highway construction has gone up 47 percent, according to a Federal Highway Administration index.
* The Texas population has increased by 27 percent, to 22 million.
* The highway system has grown 3.5 percent, to 79,513 miles. The lane-mile count has increased 3.3 percent, to 189,284 lane-miles.
Copyright (c) 2004 Austin American-Statesman: www.statesman.com