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Crisis Looms as Transportation Funding Plummets in 2013

With state transportation funding set to fall off a cliff the Legislature is considering Governor Gregoires proposal to raise $3.6 billion for highway maintenance.

AGC appreciates the $3.6 billion proposal as a good start but believes it falls well short of the funding needed to address the states transportation infrastructure needs. After all just two weeks ago the Governors own Connecting Washington Task Force released its recommendation of $21 billion in funding over the next ten years.

AGC is concerned that the Governor and Legislature are not being bold enough in addressing the Mt. Rainier-shaped graph of transportation spending as presented in this graph created by WSDOT which shows transportation spending plummeting starting in 2013. The steep descent is due primarily to the fact that projects funded by the 2003 and 2005 gas tax increases are nearing completion. Most of the states gas tax collections are committed to those projects city and county roads and debt service. Without new revenue only 8 cents of the 37.5 cents per gallon gas tax will be available for both maintenance and new projects. Educating policymakers about this dramatic decrease in available funding should be a high priority for all AGC members.

Bob Adams Vice President of Guy F. Atkinson Construction served on the Connecting Washington Task Force which spent six months creating a ten-year strategy to maintain and improve the state’s transportation system. To raise the $21 billion the task force provided a menu of funding options such as a gas tax increase an electric motor vehicle fee tax increment financing and others. The Governors proposal used some of these funding options but most controversially her proposal relies primarily on a $1.50 fee per barrel of oil produced in Washington State. The task forces revenue options suggested a $0.50 fee. AGC is currently neutral with regard to the barrel fee but believes all revenue options should be on the table.

Click Connecting Washington to see the task forces report and recommendations. Click Governors proposal to see a Seattle Times article describing it.

The Governors proposal has been drafted into legislation (HB 2660 and SB 6455). Below are specifics of the bill which is the subject of hearings this week in Olympia:

• The intent section specifies that the barrel fee constitutes a dedicated source of funding for operating and maintaining the state’s highway and ferry system. The barrel fee constitutes revenue intended to be used for highway purposes under the 18th amendments and is specifically placed in the motor vehicle fund for highway purposes.

• The combined license fee for large trucks is increased 15% and dedicated to pavement preservation.

• The passenger vehicle weight fee is increased by $15 and is distributed to the State Patrol Highway Account.

• A barrel fee of $1.50 is imposed on every person who refines petroleum products used for transportation purposes in this state.

o The fee may only used for maintaining and operating the state transportation system including $25 million annually for stormwater retrofit projects.

o The fee may not be used for general support of state government.

o It is imposed to mitigate the impact of the transportation of oil on state roads and highways and the use of petroleum for transportation purposes on public roads or Puget Sound.

• Creates a state transportation operations and maintenance account. Expenditures from the account may only be spent on18th amendment purposes.

• Transportation Benefit Districts are authorized to impose up to a $40 vehicle license fee

• Counties are authorized to impose up to 1% local option MVET.

• Imposes a studded tire fee and requires the funds to be deposited in the operations and maintenance account.

• Imposes a $100 electric vehicle fee.

For more information contact AGC Government Affairs Director Rick Slunaker 360-352-5000.

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