House transportation workgroup looks at how other states have grappled with funding woes

09/07/2017 05:28 PM

FRANKFORT — Lawmakers on the House workgroup reviewing the state’s transportation infrastructure got a better grasp on Thursday of what other states have done in recent years to finance new roads and maintain existing ones.

Legislators took an especially close look at what their counterparts in Pennsylvania did to inject $2.3 billion each year towards the state’s transportation needs.

Barry Schoch, former secretary of the Pennsylvania Department of Transportation, said they started by forming a similar workgroup and exploring all financing solutions at their disposal.

That included traditional staples like gas taxes and registration fees, but also new funding issues brought on by an influx of hybrid and electric vehicles.

“My personal view is at some point the country’s going to have to move to tolling because it’s a mileage-based fee,” Schoch testified. “If you look at our fuel consumption — both the desire of people looking for higher fuel mileage and the federal requirements of the CAFE (Corporate Average Fuel Economy) standards, meaning the average fuel efficiency – there’s a recognition that the fuel consumption is going to continue to drop per vehicle mile traveled.

“So if you think about the policy schizophrenia saying OK we’re going to use gasoline taxes to generate revenue at the same time we’re going to regulate and have a desired outcome of having less fuel consumption, sooner or later that’s going to become a problem.”

Tolling may not be a feasible option for Kentucky’s roadways, but other states are testing a similar, albeit novel, approach to find new transportation dollars. Kevin Pula, a senior policy specialist for the National Conference of State Legislators, says taxing gasoline represents a “dying” revenue resource.

States like Oregon, California, Washington and Illinois are exploring pay-per-mile systems that track mileage driven for tax purposes rather than charging for gas consumed, and Pula says Oregon remains the only state with such a pilot program up and running.

Oregon’s OreGo pilot program has been operating for about a year, with room for up to 5,000 volunteers who get monthly rebates on fuel taxes paid and instead pony up 1.5 cents per mile driven.

Pula calls such approaches for generating transportation dollars “kind of an attempt to level the playing field” between traditional vehicles and hybrid and electric cars.

“When people have looked at this, they’ve actually found that rural drivers in the program are actually getting the biggest benefit because they’re oftentimes driving the most miles and more often than not have lower-efficiency vehicles than urban drivers,” Pula said.

Ultimately lawmakers in Pennsylvania decided on a mix of approaches, such as tying the prices of registrations and licenses to inflation and lifting the flat tax on gas and uncapping the Oil Company Franchise Tax, all of which have accumulated about $2.3 billion each year.

Approving the new funding method didn’t prompt widespread changes in the legislature as Schoch says everyone who voted for the plan was re-elected in the next cycle.

“As our governor frequently said, there’s not a Democratic bridge or a Republican bridge out there,” Schoch said. “This is about as bipartisan an issue as you can get.”

Rep. Sal Santoro, chairman of the House workgroup, says many representatives in the House recognize the need for a new transportation funding model as the group drafts its proposal for next year’s 60-day session.

Charging fees for electric vehicles is one area they’ll likely look at in a gas tax reform effort, and Santoro says everything will be on the table for the workgroup to form its recommendations.

“We need to do something,” Santoro, R-Florence, told Pure Politics after the meeting.

“Our roads need to be built, and they also need to be maintained. The maintenance of them is increasing all the time because we increased the weight on some of the trucks. We want to really look at that so that we’re not just trying to catch up and catch up because we are in very, very bad need.”


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