Gas tax revenues serve as the primary funding source for states’ transportation projects. More fuel efficient vehicles, inflation and other factors have taken a toll on gas tax collections in recent years, though. In roughly two-thirds of states, total motor fuel tax revenues haven’t kept pace with inflation over the past 20 years.
Governing calculated inflation-adjusted fuel tax revenues using data reported to the Census Bureau’s Annual Survey of State Government Tax Collections.
By: Ed Mortimer
Today, the American Society of Civil Engineers (ASCE) released its latest Infrastructure Report Card, a periodic assessment of the condition of our nation’s infrastructure system, including roads, bridges, waterways, railways, public transit, and more.
The latest findings are a striking confirmation of what we already know: America’s infrastructure is in desperate need of repair.
The report card grades our nation’s infrastructure as a D+ overall, and the study’s scores by category echo the same troubling refrain: America is barely passing. Some elements of the system were found to have made slight progress, including the rail sector, which was rated a B thanks to a marked increase in private sector investment by the rail industry. This is heartening, but still, a few key categories experienced decline, and several remained unchanged from the last analysis four years ago.
Simply put, these aren’t the kind of marks anyone is going to be posting on the refrigerator.
These low scores follow a pattern of decay over decades, and they’re troubling for a number of reasons, not least of which is the fact that America’s infrastructure is the backbone of our economy.
Businesses of every shape and size – and the employees that make them tick – rely on our airports, our interstate highway system, and our waterways each and every day as they move their products and serve their customers. Congestion at airports makes travel a headache for business and leisure travelers alike, all of whom drive economic activity. Poor roads and railroads wear on the trucks and trains we rely on to carry goods across the country, reducing capacity and slowing the pace of the deliveries we eagerly await at our doorstep. Crowded ports delay shipments from making their way onshore and being linked to the next step in the supply chain.
When you think about it this way, “infrastructure” is a far-reaching concept. The ASCE assigns grades in 16 categories, but no matter how you slice it, one thing is for certain: The sum of the parts is the lifeblood of American growth, success, and prosperity.
The challenges facing our nation’s aging infrastructure system are significant, but they are not insurmountable. The Trump administration has been vocal about the task at hand, affirming the need to rebuild and modernize our infrastructure. Congress has also indicated its willingness to get to work on a fix. These are all promising indicators. It’s time for our leaders in Washington to take charge and tackle the problem for good.
For years, the Chamber has supported meaningful action to reinforce our one-of-a-kind infrastructure system, and we have a slate of potential solutions to prove it. Then comes the tough part: In order to turn those ideas into action, we need to invest. So how do we pay for it?
Over the last few weeks, policymakers have offered various answers, including direct federal funding, revolving loan programs, tax-preferred financing, and public-private partnerships. Just yesterday on the Hill, we laid out the business community’s perspective on the question. Our answer is this: All of these options should be on the table. Any infrastructure package should make use of a variety of funding and financing options to increase our investment, but at the end of the day, a long-term, sustainable funding source should no doubt serve as the anchor.
America’s latest grades on infrastructure are alarming, to be sure, but it is a reminder of the urgent need for action to rebuild and restore the system upon which our economy thrives. The attention being paid to this issue is encouraging, and we should to seize this moment of consensus across political and industry lines.
The time for infrastructure investment is now, and it is incumbent upon us all to devise a fix soon that better serves our nation’s businesses, workers, and customers.
Ed Mortimer is executive director of Transportation Infrastructure at the U.S. Chamber of Commerce.
By: Steve Flowers
My tradition for over two decades has been to give my children money for Christmas. Under this system, there is no returning of items. They get what they want or need. There is no way that I would know what style of clothing, color or size they like. It works well.
The most illuminating thing that occurred to me this year is that both of my daughters and my granddaughter bought all their Christmas gifts from me online. Without question, our country and state have changed dramatically technologically in my lifetime. Therefore, Alabama and other states have to change the way that sales tax is collected. States have to find a solution and the will to derive sales tax from online purchases.
The legislature has wisely set up a budget reform task force to study, evaluate and come forward with long-term solutions to problems and loopholes in the law like online sales tax. The committee is headed by two stellar legislators, Sen. Clyde Chambliss (R-Prattville) and Rep. Danny Garrett (R-Trussville). This blue-ribbon panel will review and develop recommendations as to how Alabama can adjust to 21st-century budgeting.
This non-collection of sales tax on online purchases is a serious problem and it perfectly illustrates how our tax system is more designed for the 20th century than the 21st. We, like many other states, are not keeping up with the technology shifts in the world. Legislators unquestionably have to re-evaluate the state’s tax structure to reflect the new online and digital economy.
Rep. Garrett has wisely acknowledged, “We used to tax about two-thirds of the economy with the sales tax. Today, we tax one-third of our economy.” He further observed, “We are leaning very heavily on the income tax, and our sales tax base is eroding due to online sales.”
Another issue, which will be discussed during this legislative session, is the deterioration of our transportation system in the state. This problem is not unique to Alabama. In fact, President Trump made this a hallmark issue of his campaign last year. Most Washington political observers fully expect to see a massive infrastructure package passed in a bipartisan manner early in Trump’s administration.
Alabama needs to be poised to take advantage of this bonanza. The last major federal highway initiative came in the 1950s during the administration of Ike Eisenhower. It was also passed with bipartisan support.
According to recent studies, 15 percent of Alabama roads and highways are in poor condition and 35 percent more are rated as fair, with 25 percent of our bridges deemed obsolete. The legislature may need to look at increasing the gas tax to take advantage of this federal windfall. More than likely, a state tax contribution will be needed to match the federal dollars. Alabama’s gas tax has not been increased since 1990.
We have Richard Shelby, but he may need some help. The new Speaker of the House, Mac McCutcheon is from the Huntsville/Madison County area. The Rocket City is Alabama’s crown jewel economically. They realize the importance that adequate progressive highways are to sustained growth and prosperity. McCutcheon spearheaded the effort to increase the revenue for roads and bridges last year. About a dozen states raised the gas tax in 2016 to keep up with inflation and growth. Our neighboring state of Florida was one of them.
Speaking of McCutcheon, he is adjusting well to his new role a Speaker. He is fair and even handed. His selection of Rep. Alan Boothe to be his Rules Chairman seems to be meshing well. The House leadership has changed even more dramatically since the session began. The Republican caucus has elected Rep. Nathaniel Ledbetter of Rainsville as their new Majority Leader. Ledbetter is a freshman House member and former mayor of Rainsville. Rep. Connie Rowe of Jasper will serve as Vice-Chairwoman of the Caucus. She is the first female to hold the position. Ledbetter replaces former Majority Leader Mickey Hammond of Decatur.
Sen. Cam Ward has become the good shepherd, chief cook and bottle washer of the prison construction project. He has scaled back the size and scope of the original proposal. The legislature is trying to stay ahead of the federal courts on addressing the state’s prison overcrowding problem.
See you next week.
Steve Flowers is Alabama’s leading political columnist. His weekly column appears in over 60 Alabama newspapers. He served 16 years in the state Legislature. Steve may be reached at www.steveflowers.us.
WASHINGTON – “Federal mandates and environmental requirements hamper Alabama’s efforts to recover its decaying roads and bridges,” Elmore County Engineer, Richie Beyer, told a Congressional committee focusing on government inefficiency.
As the Alabama Legislature readies to consider a state-funded initiative to resurface more than 12,000 miles of county roads, Beyer said that federal requirements are costing taxpayers through increased construction costs and unnecessary delays. As a former president of the National Association of County Engineers, Beyer said the challenges faced by Alabama engineers are repeated across the country.
“When county projects utilize federal funding, higher project costs and longer delivery times are the norm,” said Beyer during the committee’s 90-minute hearing of the Subcommittees on Interior, Energy and the Environment and Intergovernmental Affairs. “Bureaucratic red tape and cumbersome environmental reviews slow projects down and drive labor costs up. Currently, counties are required to follow the same exhaustive federal requirements on a small sidewalk or preservation project as they would for mega-projects.”
Beyer’s testimony comes just weeks before the Alabama Legislature is expected to consider a $1.2 billion bond issue proposal dedicated to local road and bridge improvements. Beyer said the project, known as ATRIP-2, would give each county in Alabama a minimum of $10 million for county road projects—some of which are ineligible for federal funding.
“This innovative program here in Alabama represents a commitment that tax dollars will be used as effectively and efficiently as possible,” he explained after returning to Alabama. “We look forward to working with the Alabama Legislature on improving our county roads and bridges beginning this fall.”
The Association of County Commissions of Alabama (ACCA) unanimously voted to support a $1.2 billion bond issue to be divided up amongst all 67 counties to fund county infrastructure projects at its Annual Legislative Conference last December.
Sonny Brasfield, the Executive Director of the ACCA, said that the bond issue would put many Alabama counties ahead of their road and bridge improvement schedules by 15 to 20 years. “This proposal presents local governments with a unique opportunity to make significant improvements to local roads and bridges, without the time-constraints or extra costs associated with federal funding,” said Brasfield. “Citizens could see the benefit of this investment in the form of resurfaced roads and bridge improvements within the next 12 months.”
The legislation authorizing the bond issue is expected to be introduced in the Alabama Legislature early next month. Currently, 53 of Alabama’s 67 county commissions have adopted resolutions in support of the proposal.
The Association of County Commissions of Alabama (ACCA) is a statewide organization representing county government in Alabama. ACCA promotes improved county government services in Alabama, offers educational programs for county officials and their staff members, administers insurance programs for county governments and employees, offers legal advice, and represents the interests of county government before state and federal organizations and agencies.
Tomorrow morning millions of folks in Alabama will turn the switch, throw the car in reverse and head out for the daily responsibilities. Before leaving they’ll give a great deal of thought to where they’re headed, who they’ll see, and what they’ll do when they get there.
The thing most of us almost never consider, of course, is the safety of the roads we’ll drive on or the bridges we’ll cross.
That’s how we have done business here in Alabama for more than two decades and today, by any measure, all of us drive on some of the worst-maintained roads in the country. The statistics are indisputable and the evidence, if you’ll take a look around tomorrow when you hit the road again, is certainly enough to us worry about our own safety. Every day school buses in Alabama detour hundreds of bridges that are so unsafe that they have failed federal review standards. Children spend way too long bouncing in the bus seats simply because we have ignored the problem for decades. Alabama’s much-discussed “farm-to-market” road system is in deplorable condition. In a state that depends on farm and timber income to feed and support the local economy in almost every community, our road system should be one of the best in the nation. However, that isn’t the case. A world-wide study a couple of years ago called Alabama’s Highway 431, that stretches from the Tennessee Valley to Dothan, the “highway to hell” and listed it as one of the four most dangerous roads in the world. And, tragically, our rural road fatality rate is among the worst in the country.
Over the last couple of months, we’ve worked hard to raise the public’s awareness of the crisis that lies ahead. And, by now, most of you have probably read and heard a great deal about a new effort to repair our roads and bridges that has been initiated by County Commissioners all over the state. The project is called ATRIP-2 in an effort to continue the forward momentum we’ve made in the last four years through the Alabama Transportation Rehabilitation and Improvement Program (ATRIP) initiated by Gov. Robert Bentley. This new initiative will make $1.2 billion available statewide by issuing bonds funded with an increase in the gasoline and diesel fuel tax of 3-cents per gallon. This reasonable, temporary adjustment in the tax rate will pay dividends in every community in our state.
The legislation needed to establish ATRIP-2 will be introduced during this year’s regular session of the Alabama Legislature. The language of the bill will ensure that the money can ONLY be spent on roads and bridges. It will also provide that each year the Alabama Department of Examiners of Public Accounts will audit the expenditures and will have the power to make public officials repay any money that is not allocated directly to roads. No money can go to salaries, purchases of equipment, or any other items. Sure, passage of the legislation will cost everyone a little extra money, but only a little. If you drive 12,000 miles a year you’ll pay an extra $1.50 per month. None of us want to dole out any more money, but is there really any other way to improve our transportation system?
Clearly, two decades of ignoring the problem has only made matters worse.
I’ve spent almost 30 years working to help improve the services delivered by county governments in Alabama, and this project represents the most transparent and accountable initiative that I’ve ever seen. It is certainly focused on a problem that touches every one of us every time we get inside a vehicle.
When you hit the road tomorrow, maybe it’s time for you to take a look at the conditions of the roads you drive and the bridges you cross. And, just maybe, you’ll agree that it is finally time to let your opinions be heard.
Sonny Brasfield is the Executive Director of the Association of County Commissions of Alabama. He directs a Montgomery-based organization that provides assistance and unified leadership for Alabama’s 67 county governments.
Montgomery, Ala.—The Association of County Engineers of Alabama (ACEA) voted to support a $1.2 billion bond issue that the Association of County Commissions of Alabama (ACCA) is currently seeking legislative approval for in the 2017 legislative session. The proposal, approved at the ACCA Annual Legislative Conference late last year, calls for a three-cent per gallon increase on gasoline and diesel fuel that would expire when the bonds are repaid.
The $1.2 billion total will be divided up amongst all 67 counties based, in part, on each county’s population. ACCA Executive Director, Sonny Brasfield, said that the minimum allocation for each county under the proposal is $10 million. The revenue from the bonds can only be spent on road and bridge projects. It cannot be spent on salaries, equipment, or any construction other than roads and bridges.
“For a person driving about 20,000 miles per year – which is a high estimate – this increase would cost about twenty-five dollars ($25.00) a year. That’s just a few cents over two-bucks a month. It doesn’t seem like much, but that money will greatly improve the lives of Alabamians who drive on poor roads and bridges every day,” said Brasfield.
ACEA President, David Palmer, said that this plan will leave a long lasting, positive impact on all counties in the state. “I believe in value and return on investment. If we don’t invest in our infrastructure now, we will pay the price later. It will be less expensive to fix our roads and bridges now then to try and reclaim them after it’s too late and the irreversible damage is done.”
County Engineers are working to develop county specific maps that detail where the bond issue will positively affect their individual counties. Residents who are interested in sharing their most pressing road and bridge needs are encouraged to fill out a short survey found at www.drivealabama.org/about/survey.
The Association of County Commissions of Alabama (ACCA) voted today to support a 3-cent per gallon fuel increase to fund a $1.2 billion bond issue for local road and bridge projects. The bond issue would cost the average Alabama driver a nickel a day — less than $1.50 each month.
ACCA Executive Director Sonny Brasfield said counties need to shift focus and get behind a concrete infrastructure plan before the legislative session begins on Feb. 7.
“We just feel like the only way to push this forward is for county leaders to advocate for a specific plan,” Brasfield said.
Under the plan approved by the ACCA membership today, revenue from the bonds would be divided among counties using the existing gasoline tax formula. While the formula is partially based on population, under this plan, every county would get a minimum of $10 million. Twenty percent of the money would be spent within municipalities.
The legislation would prohibit the bond money being used for salaries, equipment, or for construction other than road projects. It would also require periodic reporting on the projects. The 3-cent tax increase would expire on the June 30 following the repayment of the bonds.
The new plan would come on the heels of the Alabama Transportation Rehabilitation and Improvement Program, ATRIP, which was launched a few years ago and has allowed cities and counties to undertake hundreds of road and bridge projects.
“Some roads that were not eligible for ATRIP funds would be eligible under the new plan, which is being called ATRIP-2,” said Brasfield.
HUNTSVILLE, AL- It’s no secret roads across the state of Alabama are unfavorable at best. According to officials, nearly 50% of state highways are in fair, poor or very poor condition.
“Some counties say they’re at the point where they can no longer repave their roads, they’re thinking about scraping up the broken asphalt and putting their roads back to gravel because they just don’t have the money to pave their roads,” said Representative Mac McCutcheon.
What would you be willing to pay for improvements? Representative McCutcheon is proposing a 6-cent tax increase on gas to fund road improvements through House Bill 394. Without the funds, McCutcheon believes Alabama roads will reach crisis status as soon as next year.
“The urgency is here, there’s no doubt about it,” said Representative McCutcheon.
The gas tax ensures everybody who passes through, not just Alabamians pay for their share of road use.
“We have a lot of people who drive through this state, going to the beach, going to Gulf Shores, they use our roads, they have wear and tear. They should be expected to help us pay for our roads as well,” said Representative McCutcheon.
Lawmakers have waited 25 years to address this issue, McCutcheon says enough is enough. “We cannot build roads, we cannot continue to address our infrastructure needs on 1992 revenue streams,” said Representative McCutcheon.
McCutcheon says Senate Bill 180 will ensure 100% of revenues raised will go only toward road construction.
“The counties, municipalities and the state will have to be held accountable for those dollars, in those dollars they will have to report those dollars out on a yearly basis, the report will be made public,” explained Representative McCutcheon.
The legislature will reconvene Tuesday; McCutcheon says he’s fairly confident the tax increase bill will be on the floor this week but he says both bills need to pass the house and senate in order to work.
The Association of County Commissions of Alabama (ACCA) applauded the passage of Senate Bill 180 by the Alabama House of Representatives on yesterday. The bill, sponsored by Sen. Gerald Dial, is unique in that it includes protection features to ensure accountability and transparency in a way currently unseen in Alabama. Prior to the introduction of SB 180, county leaders expressed concern that legislation creating additional road and bridge revenue could be diverted for other uses, leaving counties to face perpetual infrastructure deterioration.
“Senator Dial’s bill is critical to the process of securing additional revenue for deteriorating county roads and bridges. It is our guarantee that any monies generated for transportation infrastructure will only be spent where it is desperately needed – on our local roads and bridges,” said Sonny Brasfield, Executive Director of the Association of County Commissions of Alabama. “This bill, particularly the creation of the Alabama Transportation Safety Fund, demonstrates that legislators have made a long-term commitment to improving the condition of Alabama’s roads and bridges.”
SB 180 establishes the Alabama Transportation Safety Fund along with expenditure guidelines for any road and bridge revenue generated this session. Specifically, it does the following:
Passage of SB 180 could directly impact House Bill 394 by Rep. Mac McCutcheon, which proposes a $.06 per gallon increase at the gas pump that would cost Alabamians approximately $5 per month. A 2015 review of county highway programs by DRIVE Alabama revealed that the majority of Alabama counties would need to see an approximate increase of 175% in annual revenue to adequately preserve and improve their road and bridge networks.
“County engineers from all over the state have spent the last year working on the DRIVE Alabama campaign to bring more attention to the silent crisis facing Alabama’s county roads and bridges,” said Brasfield. “The revenue generating measure proposed by Rep. McCutcheon this session represents a responsible approach to addressing the funding deficits faced by many local road and bridge programs.”
Rep. McCutcheon’s bill, HB 394, could be considered by the Alabama House of Representatives as early as next week. For more information on SB 180 and HB 394, visit the DRIVE Alabama campaign at www.drivealabama.org.