Beyond the Bond:  

A Long-Term Solution to Maine’s Transportation Needs

 

On June 12, Maine voters will have the opportunity to approve $113 million, leveraging an additional $260.5 million in federal and other matching funds, to help repair Maine roads. This investment is both critical and overdue.  In the long run, it is also insufficient. 

 

Mainers know our roads and bridges have been deteriorating for many decades.  They want us to stop pointing fingers, and start solving problems.  Such a solution is now before the Legislature’s Transportation Committee in the form of LD 1790, “An Act to Secure Maine’s Transportation Future.” 

 

LD 1790 is sponsored by Senator Dennis Damon, Senate Chair of the Joint Standing Committee on Transportation.  It enjoys strong co-sponsorship, including leadership on both sides of the aisle.  It is backed by the Maine Better Transportation Association, whose members have worked tirelessly for road and bridge improvement.

 

LD 1790 faces the fundamental flaw in our present Highway Fund structure -- revenue instability -- and proposes real solutions.

 

For over 80 years, Maine’s Highway Fund has dedicated certain tax revenue – principally fuel taxes – to supporting our dependence on the automobile.  Maine protects this Fund from other uses under Article IX, Section 8, Subsection 19 of the Maine Constitution.

 

Between the Depression and the postwar period of the 1950s, Maine’s highway and bridge infrastructure saw an unparalleled level of public investment, as government spent more and citizens made real sacrifices to build the U.S. economy.  About a third of Maine’s existing bridges and minor spans were constructed 70 or more years ago.

 

Today, over three-quarters of the Highway Fund go directly to the Department of Transportation and our infrastructure.  The remaining twenty-five percent is allocated to the Department of Public Safety (mainly for the State Police that patrol our roads), the Bureau of Motor Vehicles, debt service, and less than one percent to other agencies. 

 

The revenue for the Highway Fund comes from license fees, vehicle registrations, traffic fines, and inspections, but above all from the fuel tax. In the last budget cycle, almost 70% of the Highway Fund came from the fuel tax alone. 

   

Not surprisingly, the improvements in fuel economy that began in the 1970s have meant real declines in Highway Fund revenue.  At the same time, the decline in rail freight during the past 50 years has increased the volume of heavy truck transport, adding new wear and tear to our tired roads.

 

As long as our roads and bridges hang directly from the bungee cord of fossil fuel consumption, their safety will be increasingly at risk.

 

LD 1790 proposes a comprehensive, transportation capital improvement program that is geographically balanced and addresses urban and rural needs. If passed, it would also cause the first major re-crafting of the Highway Fund in 30 years.

 

Under the goals established in this bill, within 20 years 1,900 miles of state highways that have not been reconstructed in over 50 years will be modernized, and roughly one-third of the State’s aging bridge inventory will be replaced or substantially rehabilitated.  All principal and minor arterials will be reconstructed to nationally accepted design standards by 2011, and all major collectors will be reconstructed by 2027 at least to the Department’s State Design Standard (about 195 miles are not yet up to standards).

 

The legislation would establish two funds: the Bridge Investment Trust Fund and the Transportation Investment Trust Fund.  Each fund would be maintained by the Maine Municipal Bond Bank. 

 

The Bridge Investment Trust Fund would be capitalized by having the Treasurer of State annually deposit 7.5% of motor fuel taxes (about $18 million per year) into the Fund.  Also, the Bond Bank would be empowered to issue federal GARVEE bonds supported by un-obligated portions of the Federal Bridge Program dollars (presently about $27.8 million per year).

 

The Transportation Investment Trust Fund would be capitalized by contributions from a five year phase in of existing sales tax receipts on vehicles and auto parts, not to exceed 20% of the total, and through additional, matching contributions from the state and from towns.

 

The proposal to divert hundreds of millions from the General Fund to the Highway Fund is both unprecedented and necessary.  It may not be popular, but I am supporting it.  Our choice is to spend a dollar today, or force our children to spend ten tomorrow.

 

I am hopeful that Maine’s Legislature will see the need to create a more stable long-term capital improvement fund for transportation, and will send LD 1790 on to the Governor with a ringing endorsement.  In so doing, we can help build lasting prosperity, and help to secure the road ahead.