As expected it landed with a thud.
A couple of weeks ago, a commission released a report on the state of Wisconsin's transportation infrastructure. This report called for various transportation tax increases, including a per mile fee to pay for the maintenance of the roads we drive on.
Editorial boards generally thought the tax increases were necessary, while Gov. Walker, most legislators and the public did not. The general feeling out there is that yes, we would like smooth, safe roads to drive on and better mass transit, but no, we'd rather not pay for any of that.
So after fifteen months of work -- I was a commission member appointed by Sen. Mark Miller (D-Madison) -- our report has been deposited in several special receptacles located right under legislators' desks, mostly unread I suppose.
Several people I talked with who should know suggested that instead of proposing transportation tax increases, they expect the governor to propose more borrowing and a transfer from the general fund to the transportation fund, possibly by moving funding for transit from the transportation fund to the general fund. They say that he is also likely to follow the commission's recommendation to create regional transit authorities, but only for the Fox River Valley.
None of that is unexpected, but here are the problems with it. Pardon me while I wonk out.
First, there's the obvious. Regional transit authorities make sense in a lot of parts of the state, so there's no reason to limit the option to the Fox River Valley. I suppose some lame policy reason will be offered if that's what they do, but the real reason will be that the Fox Valley votes for Republicans and Dane County and Milwaukee don't.
Second, while low interest rates and good construction bids actually make this a good time to borrow for projects, we're getting to the limit of what's prudent. Paying back debt is now consuming about 15% of transportation fund revenues, and that's projected to increase to 25% in ten years. The commission recommended that we not go beyond 25% and some states actually have a 20% limit. But if more projects are moved to debt-financing and sooner than anticipated, then we'll get to that 25% even faster. Of course, everything we can pay for in cash saves interest costs.
Third, it is not a good idea to fund transportation projects out of the general fund. Right now there's a firewall between the general and transportation funds, meaning that the powerful road builders lobby doesn't compete against non-transportation spending. But if we allow that wall to be breached, then road building will vie for limited general state resources alongside schools, environmental programs, human services and everything else. This cannot end well.
Finally, it's a bad idea to move state support for transit out of the transportation fund to the general fund. That makes it easy to start thinking of transit as more of a discretionary program and not what it is, which is part of the transportation network that helps move people to and from their jobs.
No matter what the governor and legislature do, they can't escape the need for more transportation revenues at some point. The gas tax, which is now the leading source of funds, is at best flat because of increasing fuel efficiency. We can limp along like this for the next two years and a biennium or two after that, but eventually the cracks, potholes and gaps in our transit service will start to become more apparent. And that will hurt our economy.
