Hypothetical "lost profits" without toll roads used in TxDOT numbers game
State: No tolls would mean 17-cent gas tax
Potential alternative to toll roads not yet legal under state law.
September 12, 2006
By Ben Wear
Austin American-Statesman
Copyright 2006
It would take a local gasoline tax of about 17 cents a gallon to replace the money brought in by a controversial second round of toll roads, the Texas Department of Transportation says in an analysis released Monday.
That estimate dwarfs an earlier figure of 2.4 cents a gallon produced by the staff of the Capital Area Metropolitan Planning Organization. But that 2005 estimate came in answer to a different question: What would it take to replace about $500 million in lost state funding and borrowed money if the five Phase II toll roads were to be built as free roads instead?
This latest calculation takes into account the lost profits from the toll roads over the next four decades, as well as a (hypothetical) $2 billion bond sale in 2048 to build more roads or rail projects, a borrowing that would be supported by the tollway profits still further in the future. That amounts to about $4.4 billion in revenue that would have to be matched by a gas tax, according to the analysis.
The estimate of forgone profits in the early years, through 2030, is a much more modest $293 million. A cent of gas tax applied to Travis, Hays and Williamson counties, according to the analysis, raises about $4.5 million a year (after removing the 25 percent that under the Texas Constitution would have to go to public schools).
State Rep. Mark Strama, a Austin Democrat who asked for this latest analysis, has not said whether he opposes or supports those five proposed roads in the Phase II tollway plan. Monday, after seeing the Transportation Department's report for the first time, Strama said that it was lot to absorb on short notice.
"I think they're giving their best effort to get answers to questions we've had for along time," Strama said. "But these are complex questions, and it's going to take me some time to fully analyze it."
At this point, the discussion among local transportation policymakers is completely theoretical because Texas law does not allow a city or county or region to enact its own local gas tax. The only legal levy is the statewide gas tax of 20 cents a gallon (along with an 18.4 cents a gallon federal gas tax).
The state House in 2005 tacked a local gas tax authorization onto another bill and passed it. That gas tax provision would have allowed regions to have an additional gas tax of up to 10 cents a gallon.
In the case of Central Texas, the bill would have required separate elections in Travis, Hays and Williamson counties. All three would have had to say yes — although the proposed tax rate for each could vary — and the tax would have been the lowest passed by any one of the counties.
The local gas tax, however, went nowhere in the Senate, and Gov. Rick Perry has said he does not support allowing one.
But what the debate lacks in legal substance it makes up in political import. The 23 members of the CAMPO board, all but two of them elected officials, have been under pressure for more than two years to reverse a July 2004 vote in favor of the Phase II toll road plan, which now includes one completely new road (an extension of Texas 45 Southwest) and expansions of four other roads where travel is now free. Under the plan, the new express lanes would have tolls and the frontage roads would be free.
Critics call that double taxation, given that much of the ground under the expanded roads was bought years ago with tax dollars. Some board members have latched onto the idea that a local gas tax, if one could somehow be made legal, could obviate the need for the second wave of toll roads to follow the four Phase I tollways scheduled to open in Central Texas this year and next.
The 2.4-cent-a-gallon estimate, small enough that it might actually pass muster with voters, made the gas tax option particularly tantalizing. The new estimate, to the extent that it is accepted as legitimate by policymakers and the public, may or may not fall withinCAMPO board members' political comfort zone.
bwear@statesman.com; 445-3698
© 2006 Austin American-Statesman: www. statesman.com
Potential alternative to toll roads not yet legal under state law.
September 12, 2006
By Ben Wear
Austin American-Statesman
Copyright 2006
It would take a local gasoline tax of about 17 cents a gallon to replace the money brought in by a controversial second round of toll roads, the Texas Department of Transportation says in an analysis released Monday.
That estimate dwarfs an earlier figure of 2.4 cents a gallon produced by the staff of the Capital Area Metropolitan Planning Organization. But that 2005 estimate came in answer to a different question: What would it take to replace about $500 million in lost state funding and borrowed money if the five Phase II toll roads were to be built as free roads instead?
This latest calculation takes into account the lost profits from the toll roads over the next four decades, as well as a (hypothetical) $2 billion bond sale in 2048 to build more roads or rail projects, a borrowing that would be supported by the tollway profits still further in the future. That amounts to about $4.4 billion in revenue that would have to be matched by a gas tax, according to the analysis.
The estimate of forgone profits in the early years, through 2030, is a much more modest $293 million. A cent of gas tax applied to Travis, Hays and Williamson counties, according to the analysis, raises about $4.5 million a year (after removing the 25 percent that under the Texas Constitution would have to go to public schools).
State Rep. Mark Strama, a Austin Democrat who asked for this latest analysis, has not said whether he opposes or supports those five proposed roads in the Phase II tollway plan. Monday, after seeing the Transportation Department's report for the first time, Strama said that it was lot to absorb on short notice.
"I think they're giving their best effort to get answers to questions we've had for along time," Strama said. "But these are complex questions, and it's going to take me some time to fully analyze it."
At this point, the discussion among local transportation policymakers is completely theoretical because Texas law does not allow a city or county or region to enact its own local gas tax. The only legal levy is the statewide gas tax of 20 cents a gallon (along with an 18.4 cents a gallon federal gas tax).
The state House in 2005 tacked a local gas tax authorization onto another bill and passed it. That gas tax provision would have allowed regions to have an additional gas tax of up to 10 cents a gallon.
In the case of Central Texas, the bill would have required separate elections in Travis, Hays and Williamson counties. All three would have had to say yes — although the proposed tax rate for each could vary — and the tax would have been the lowest passed by any one of the counties.
The local gas tax, however, went nowhere in the Senate, and Gov. Rick Perry has said he does not support allowing one.
But what the debate lacks in legal substance it makes up in political import. The 23 members of the CAMPO board, all but two of them elected officials, have been under pressure for more than two years to reverse a July 2004 vote in favor of the Phase II toll road plan, which now includes one completely new road (an extension of Texas 45 Southwest) and expansions of four other roads where travel is now free. Under the plan, the new express lanes would have tolls and the frontage roads would be free.
Critics call that double taxation, given that much of the ground under the expanded roads was bought years ago with tax dollars. Some board members have latched onto the idea that a local gas tax, if one could somehow be made legal, could obviate the need for the second wave of toll roads to follow the four Phase I tollways scheduled to open in Central Texas this year and next.
The 2.4-cent-a-gallon estimate, small enough that it might actually pass muster with voters, made the gas tax option particularly tantalizing. The new estimate, to the extent that it is accepted as legitimate by policymakers and the public, may or may not fall withinCAMPO board members' political comfort zone.
bwear@statesman.com; 445-3698
© 2006 Austin American-Statesman:
posted by Porkus Maximus Tex: at Tuesday, September 12, 2006
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