Donald Fry: Breaking free of transportation funding limbo in D.C. and Annapolis

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By Donald C. Fry

While President Barack Obama’s proposed jobs legislation could offer some brief fiscal relief, major challenges must be overcome in both Washington and Annapolis to break the legislative limbo and continuing transportation funding crisis that is at the root of increasing congestion and deteriorating infrastructure in our nation and state.

These were the key messages delivered to close to 200 transportation advocates who attended the Greater Baltimore Committee’s 2011 Transportation Summit on September 19 in Baltimore.

Realistically, if any significant long-term strengthening of transportation funding is to be achieved, it must happen soon before pending elections at the national and state levels close narrow windows of opportunity, agreed experts who spoke at the summit.

The challenges

In Washington, Congress must move beyond its continuing series of short-term extensions for federal transportation funding and enact a long-term federal funding bill. But the concept of increasing funding for transportation infrastructure is caught up in the broader debate about reducing the national deficit, said Congressman Christopher Van Hollen, Jr., D-Montgomery and Prince George’s.

The job-creation aspect of increasing funding for roads, bridges, transit and other infrastructure must be emphasized in the debate over transportation funding, said Van Hollen, who is the ranking minority member of the House Budget Committee and a member of the joint “super committee” that will propose deficit reduction measures.

Only job creation will drive the nation out of the recession, so “there is nothing contradictory to say that we need to invest now in infrastructure, even as we try to reduce the deficit,” Van Hollen said.

The federal gasoline tax rate, which has not been increased in decades, no longer generates adequate federal transportation revenue, which funds a large portion of the states’ transportation budgets.

In Congress, the federal general fund has been filling in the gap between gas tax revenue and federal transportation funding obligations. “Something’s got to give in this process,” Van Hollen said.

In Maryland, President Obama’s jobs proposal could potentially deliver to the state a one-time influx of $400 million for road improvements and $200 million for transit infrastructure, said Maryland’s Transportation Secretary Beverley Swaim-Staley.

Meanwhile, Maryland transportation officials must deal not only with continuing uncertainty over long-term federal funding, but also with a stagnant revenue stream largely due to the fact that the single biggest source of our state’s transportation revenue – the per gallon gas tax rate – has not been increased since 1992.

Swaim-Staley said that, in trying to calculate the costs of projects on the priority lists from Maryland’s 24 jurisdictions for state-funded roads, bridges and other needed transportation resources, MDOT officials stopped counting when the costs of the counties’ priorities reached $60 billion. Just the single top priorities of each jurisdiction would collectively cost $12 billion, she said.

“We do need to re-think how we are setting our transportation priorities and the assumptions that we are making about funding our priorities,” Swaim-Staley said. “Thinking that we’re going to tackle somewhere between $15 and $60 billion of needs in the next 10 years is not realistic.”

Addressing Maryland’s challenges

Maryland’s best window of opportunity to strengthen funding for transportation infrastructure will be in the 2012 General Assembly session, according to State Senator Robert Garagiola, who said there’s a “good chance” that lawmakers will address the issue after they convene in January.

“If you think legislators are skittish right now, which they are, about a gas tax or any type of revenue for that matter, they’re going to be even more skittish” as the 2014 election nears, said Garagiola. It’s critical that transportation advocates pull together in the same direction to get a funding package passed in 2012, he added.

The goal should be to advocate enactment of recommendations by the Blue Ribbon Commission on Maryland Transportation Funding that the state increase transportation revenue by $800 million per year, said Garagiola, who serves on the commission.

A 10-cent increase in the gas tax rate, indexing it to inflation, and increasing vehicle registration fees by 50 percent, would raise up to $500 million in direct new transportation revenue. That, combined with expanded bonding capacity derived from the increased revenue, would enable the state to reach the $800 million in additional annual funding needed to begin addressing the state’s project backlog, said Garagiola, who sponsored such legislation in the 2011 session.

Additionally the Blue Ribbon Commission, on which I also serve, urged that the state’s Transportation Trust Fund be protected by a Constitutional amendment prohibiting transfers out of the fund for non-transportation uses.

Major roadblocks to progress

Speakers at the Transportation Summit all lamented the effect that political polarization is having on efforts to strengthen funding for transportation infrastructure.

“Unfortunately, this has become such a polarized, such a partisan issue,” said Howard County Executive Ken Ulman, who is also president of the Maryland Association of Counties.

The basic economic need for all Marylanders to have a system to move people around effectively “has somehow gotten lost,” said Ulman, noting that transportation funding used to be a bi-partisan issue in Annapolis. “We’ve got to get back to that,” he said.

State legislative analysts recently outlined a menu that included more than a dozen options other than a gas tax for increasing transportation revenue. Such options ranged from increasing various vehicle-related fees to developing regional sales taxes to help fund transportation in various regions.

Overcoming the roadblocks

“With no accountability, you’re never going to get a gas tax increase,” Joshua Schank, president of the Eno Transportation Foundation, told the GBC Transportation Summit audience. A gas tax will be supported only if lawmakers and constituents “can see a material benefit” to the tax increase, he added.

Schank was talking about the federal gas tax, but his point applies to Maryland as well. Accountability could be the key to getting something significant done on Maryland’s transportation funding issue. The public’s skepticism over whether increased revenue would actually be used for transportation could be addressed by dedicating new revenue to specific projects. Just a thought.

Everyone at the Transportation Summit agreed that, for a meaningful increase in transportation funding to occur in Maryland, two things need to happen. First, Governor O’Malley must strongly support it. Also, for any measure to be successful, it must receive unified and, as Senator Garagiola put it, “unrelenting” support from transportation advocates, commuters and transit users.

Aileen Cho, senior transportation editor for the Engineering News-Record, called on the “silent, rational majority” to tap into its passion for better transportation options.

I agree. Along the way, it’s well worth reinforcing to national and state lawmakers that spending on transportation infrastructure is as direct a government investment in jobs as you’re ever going to get.

It’s not sexy or the kind of clever, convoluted policy measure that often surfaces in Washington and Annapolis. But investment in roads, bridges, transit and other transportation projects would be highly effective in generating jobs as well as in building long-term infrastructure that delivers a basic economic and personal commodity that everyone needs – mobility.

Donald C. Fry is president and CEO of the Greater Baltimore Committee. He is a regular contributor to Center Maryland.

Recent Center Maryland columns by Donald C. Fry:

The Grand Prix’s lessons

Maryland jobs data show July gains, sobering long-term reality

Quake serves as reminder about transportation

Maryland funding for DBED lags behind competing states

Opportunity for Baltimore looms from Panama

Disconnect remains between business advocates, lawmakers over incentives

Tax structure, regulatory environment frame Maryland’s business cost challenges
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Donald C. Fry has been the president and CEO of the Greater Baltimore Committee (GBC), the central Maryland region's most prominent organization of business and civic leaders, since November 2002.

Under Don’s leadership, the GBC is recognized as a knowledgeable and highly credible business voice in the Baltimore region, Annapolis and Washington, D.C. on policy issues and competitive challenges facing Maryland. Its mission is to apply private-sector leadership to strengthening the business climate and quality of life in the region and state.

Fry served as GBC executive vice president from 1999 to 2002. From 1980 to 1999 Fry was engaged in a private law practice in Harford County. During this time he also served in the Maryland General Assembly. He is one of only a handful of legislators to have served on each of the major budget committees of the General Assembly.

Serving in the Senate of Maryland from 1997 to 1998, Fry was a member of the Budget and Taxation Committee. As a member of the House of Delegates from 1991 to 1997 Fry served on the Ways and Means Committee and on the Appropriations Committee.

Fry is a 1979 graduate of the University of Baltimore School of Law. He earned a B.S. in political science from Frostburg State College.