April Fool’s on us: Fix transportation funding issue
Remember a few years ago when April Fool’s Day provided some legislators the opportunity to rail against the automatic increase in the state gas tax? The joke’s on you, they told the public, because taxes just went up without a vote of the Legislature.
Back then, “indexing” of the gas tax was blamed for the sudden spike in fuel prices. Politicians argued that drivers were paying more because the gas tax increased automatically. Opponents called it taxation without representation.
So, in the name of good government and “relief at the pump,” there was a bipartisan consensus in late 2005 to repeal fuel tax indexing. Gas at the time was selling for about $2.37 a gallon. I just filled up at $3.35 a gallon (a 41 percent increase since indexing was repealed), which tells you a bit about the relationship between gas taxes and gas prices. Don’t worry, erstwhile lawmakers told transportation supporters, we’re working on alternative funding sources.
Here we are, April Fool’s Day 2008, and we’ve learned that the joke is really on those who care about quality transportation in this state. City streets are filled with potholes, highway and bridge projects are being delayed or deferred, transit systems are in trouble, back-ups on key corridors are growing and snowplow crews are facing mounds of red ink. And the state’s Transportation Fund—which is supposed to address all of these problems—is running a deficit.
The fuel tax, like it or not, remains the primary source of funding for our state’s transportation system. Fuel tax indexing allowed those revenues to grow in a way that partially offset the cost of construction inflation, which has increased dramatically in recent years. Without indexing or a suitable replacement, transportation investment in Wisconsin will continue to decrease. In fact, a legislative report last week estimated that the annual funding gap to meet state highway improvement goals had increased from $545 million to $746 million because resources have not kept pace with projected inflation.
Closing this gap over a period of time will require politicians to take difficult votes every two years as the state budget is crafted. Last year, lawmakers on both sides of the aisle, as well as Gov. Jim Doyle, supported significant increases in transportation user fees to keep programs and services on track.
Fuel tax indexing provides a stable, predictable revenue stream that allows the state to make long-term transportation plans and investment decisions. The repeal of indexing without an alternative revenue source was a serious public policy mistake that is having severe consequences for all modes of transportation in Wisconsin. It is undermining economic competitiveness, the vibrancy of our communities and the safe mobility of people and commerce.
Fuel tax indexing might not be the right long-term answer, given the questionable future of fossil fuels in the transportation sector. Absent that, our elected officials must begin debating and implementing long-term funding solutions that keep Wisconsin transportation moving forward.
Pat Goss is executive director of the Wisconsin Transportation Builders Association. Contact him at email@example.com or 1 S. Pinckney St., Suite 818, Madison, WI 53703; phone (608) 256-6891.