By Roland Murphy for Arizona Builder’s Exchange
Investment in transportation fuels development investment across the board, but figuring out funding for transportation projects will remain a local and regional responsibility for the foreseeable future, according to the general consensus of a recent panel of leaders.
The panel consisted of Pima County Supervisor Ray Carroll, State Senator and Transportation Committee Member Steve Farley, Phoenix District 8 City Councilwoman Kate Gallego, ADoT Director John Halikowski, and State Senator and Transportation Committee Chair Bob Worsley. The panel was moderated by AZ News Service Editor Jim Small.
As the state continues to sweep Highway User Revenue Funds away from transportation and into other expenses such as the Department of Public Safety for enforcement operations, it falls to other bodies -particularly cities, counties and regional partnerships – to plan, fund and implement transportation development projects.
According to Halikowski, state HURF sweeps total approximately $120M per year. He added Arizona needs $1B per year beyond its current transportation allocations. Carroll said the state has taken more than $1B in funding so far under HURF sweeps.
According to Gallego, Arizona is one of only five states that does not fund transportation at the state level. She advocated the value of transportation projects to the community. As an example, she pointed out the $8.2B in private and public development in the Phoenix Metro area associated with light rail projects since recordkeeping began in 2005 (AZBEX, July 31).
Gallego also noted there are 12,000 multifamily units in various stages of planning and development in the city’s downtown area that will need ongoing transportation improvements to sustain them.
Farley echoed her views on transportation investment feeding economic development across the board. He pointed out that since streetcar service started in downtown Tucson in July of 2013, the city has already hit the 1 million rider mark and seen more than $1B in investment within three miles of streetcar routes.
All panelists expressed concern about the state’s use of sweeps of HURF funds and the unsustainability of the current fuel tax as a funding source, largely due to changes in the population’s driving and personal transportation habits.
According to Carroll, between 1960 and 1990 there were nine increases in the gas tax. There have been none since. This, combined with current relatively low gas prices, the increased popularity of alternative and more fuel-efficient personal vehicles, and a move away from driving by younger people, have all negatively impacted funding. Farley noted only 40 percent of 16 year olds are getting drivers licenses today, compared with 90 percent only a few years ago.
Among possible solutions to the funding crisis discussed by panelists were replacing the gas tax with a sales tax as Utah recently implemented, a miles driven tax as is being explored in Oregon, surcharges for alternative fuel vehicles, and increases to the Vehicle License Tax. Every proposed solution, however, faces its own challenges.
Worsley pointed out Arizonans’ deep concerns with privacy issues and government monitoring would almost certainly prevent a miles-driven tax from ever being implemented. He said an estimated miles driven or user fee system might gain more support.
Several members voiced disappointment that an increase in the vehicle license tax proposed as part of the state budget died quickly and received little support, as many state officials are hesitant to support any measure that could be seen as favoring new or increased taxes.
While Carroll said, “The lifeblood of commerce is good roadways,” Halikowski pointed out that the average person doesn’t notice transportation as an issue. He cited a recent study of 50 concerns that put transportation at number 25 in respondents’ order of priorities and said leaders focused on transportation need to do a better job of educating the public.
Gallego agreed, pointing out the already realized economic development benefits from transportation projects in the Phoenix area were what pushed the recent approval of Prop 104 (AZBEX, Aug. 25).
Gallego said when transportation projects actually get implemented, people notice the improvements to facilities, employment opportunities and the logistics of day-to-day life in the impacted area. She said the argument for ongoing improvements in transportation services and infrastructure can be won by focusing on the benefits to the community at large.