The Wisconsin Department of Transportation’s 2015-17 budget request will include a long-term solution to the state’s transportation funding shortfall, but it won’t include toll roads, Secretary Mark Gottlieb said last week.
“Our hope is that whatever we propose will be sustainable, meaning that one of our goals is to propose a structure that once in place will be sustainable for the future,” Gottlieb said in an interview with the Wisconsin State Journal. “Our hope is that whatever comes out will be a long-term solution to this problem.”
The department is projecting a $680 million shortfall in its 2015-17 budget. A bipartisan state transportation commission reported last year that if Wisconsin wants to maintain current service, traffic flow and road condition levels under the existing funding system, the state will be short $15.3 billion over the next decade.
That’s largely because more fuel-efficient vehicles, including hybrids and electric cars, are eroding state revenues from the gas tax, the largest source of state transportation funding.
Options on table
Gottlieb isn’t offering a specific plan at this point. His office is still sifting through feedback collected over the course of nine community meetings and 24 small group meetings with officials from local chambers of commerce and regional economic development groups that wrapped up late last month.
The meetings, attended by more than 600 people, presented the information reported by the Wisconsin Transportation Finance and Policy Commission in January 2013.
The commission recommended these increases: the state’s gas tax by 5 cents per gallon, annual registration fees for commercial vehicles by 73 percent and the eight-year driver’s license fee by $20 to $54. The panel also recommended eliminating the sales tax exemption on the trade-in value of a vehicle; and adopting a mileage-based registration fee system for passenger vehicles and light trucks.
The commission noted a typical driver who puts 12,000 miles on a vehicle that gets 22 mpg of gas pays $254 in taxes and fees in Wisconsin per year, compared with $318 in Illinois, $352 in Michigan, $416 in Iowa and $470 in Minnesota. The recommendations would increase the Wisconsin payment by $120.
Gov. Scott Walker and some lawmakers have voiced opposition to raising the gas tax. Gottlieb would not rule out such a proposal.
The Legislature hasn’t increased the state’s gas tax, which along with federal taxes totals 51.3 cents per gallon, since 1997.
The state ended gas tax indexing for inflation in 2006.
Walker also opposes toll roads. Those aren’t something the commission recommended, though there is evidence of public support for the idea. A recent Marquette Law School poll found a majority of respondents supported toll roads, while an even larger majority opposed increasing the gas tax, borrowing more or using general state taxes that fund other services.
Gottlieb said toll roads aren’t feasible for the 2015-17 budget because they would require an act of Congress.
“For the challenges we’re facing in the short term, it’s not a solution that could be practically or legally implemented,” Gottlieb said.
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Asked about other solutions being considered that weren’t in the Marquette poll, Gottlieb mentioned changing vehicle registration fees from a flat $75 per year to a mileage-based system.
Gottlieb said if the state pursued that option, it would not involve a device installed in vehicles to track miles traveled remotely, which some states are trying.
Neither Walker nor his probable Democratic challenger Mary Burke, has articulated specific prposals for how to address the transportation short-
“We have to make sure we are making smart decisions about what money needs to be spent,” Burke told the State Journal in an email. “So if after making sure that everything in the budget is a wise investment and we are still short on funding, I would be willing to look at all other options for funding.”
Walker spokeswoman Laurel Patrick said the governor has taken steps to strengthen the state’s transportation system, including $6.4 billion in infrastructure spending in the recent budget, noting former Democratic Gov. Jim Doyle used money from a segregated transportation fund to balance the state budget.
Doyle transferred $1.4 billion from the transportation fund to the general fund over four biennial budgets, but also borrowed about $1 billion for roads using general fund-backed bonds, according to the nonpartisan Legislative Fiscal Bureau.
Walker stopped transferring money from the transportation fund, but continued to borrow more than $1.1 billion for roads over the last two biennial budgets. He also has transferred about $450 million from the general fund back to the transportation fund.
“Governor Walker continues to be committed to funding our transportation infrastructure as it is an important part of economic development,” Patrick said.
Patrick Goss, executive director of the Wisconsin Transportation Builders Association, said it’s too early to commit to a specific fix for the state’s transportation funding shortfall because of several factors.
The National Highway Trust Fund is expected to run short on money later this year, and the U.S. Department of Transportation could scale back payments to states, which could exacerbate Wisconsin’s projected $680 million transportation funding shortfall in the next budget.
More funding requires action by Congress, but lawmakers have yet to move on President Barack Obama’s $302 billion four-year transportation plan, which includes allowing states to toll Interstate highways.
It’s also unclear what the political landscape will look like in Wisconsin after the November election.
“At this point right now, you don’t know what your solutions are,” Goss said. “The encouraging thing is there’s an acknowledgement coming from both sides of the aisle that we’re facing a crisis.”