This is the second in a series of three articles about finding solutions to fund improvements to state roads.
The three state Transportation Commissioners agree that more funds are needed to meet the state’s bridge and highway needs.
The trick, they note, is how to get that financing from a Legislature reluctant to raise taxes or add new ones.
Though they note that there are many avenues for Mississippi to invest in state infrastructure, both Commissioners Tom King and Dick Hall said the quickest method might be to raise the state fuel tax.
“I believe that now would be the time to increase the fuel tax,” King said. “In 2017, it will have been 30 years since it was last adjusted.”
“The price of gasoline is lower than it has been,” King continued. “(Cars) get so many more miles per gallon. I think in a short time, the next ten years, they will have an increase in the fuel tax. That’s the simplest, cleanest way to do it.”
But Hall, a former state legislator, hesitates to tell the Legislature how it should fund the Transportation Department.
“I’m certainly not going to be the one to tell the Legislature how to fund it,” Hall said. “My job is to say ‘Here is the situation. Here is the problem we have. Here is the kind of money we need.’ It’s up to them to decide (how to fund it).”
Commissioner Mike Tagert of the Northern District said that he doesn’t believe the department’s funding woes can be settled through one source.
Tagert said the Mississippi Economic Council’s push this spring for an additional $375 million felt a little spare. But being pragmatic, Tagert said he was willing to accept what he could get.
“Because of the nature of the large amount of funding and resources needed to address the program long term, the MEC ultimately campaigned for an additional $375 million for infrastructure,” he said. “They knew it wouldn’t be everything they needed, but it was a reasonable number and palatable one.”
King said, “We’re a special fund agency. We don’t receive any moneys from the Legislature unless it is through a bond or something of that nature. All of our funds come from fees and the gas tax and reimbursements. We certainly can’t tell them how to fund, however we can give them our ideas and work with them.”
One idea Tagert mentioned as a starting point would be an annual bonding for non-maintenance related projects.
The Transportation Department estimates that maintenance for roads would cost an additional $694 million per year and bridges, $145 million per year, for five years and $125 million per year afterwards.
That means that just for maintenance, an additional $839 million will be necessary for the agency to provide the maintenance the state needs.
In contrast, the agency estimates that $158 million per year will be necessary to expand corridors in high growth areas and congested freight paths. A regular bond for capacity growth might provide the necessary flexibility to grow infrastructure where need while maintaining the existing roads, Tagert said.
“If we were able to bite the bullet and fund our infrastructure the way it needs to be,” Tagert said, “that’s not just fixing the problem for us — that’s fixing the problem four, five, six generations down the line.”
If infrastructure is going to get the funding that the commissioners hope for, Tagert said awareness is key. That’s why he applauded efforts this summer by Rep. Charles Busby, R-Jackson County, to lead members of the House Transportation Committee to look at the degree of decay in infrastructure in each of the three transportation districts.
“It was only just a couple of years ago that people were wondering whether or not the need was there,” Tagert said. “If you get people to recognize there is an issue (in infrastructure), we can begin working on a solution.”
In terms of funding, the Transportation Department is an outlier — it is a special fund agency. Most state agencies are funded with the money appropriated by the Legislature from the general fund each session. Though the legislature appropriates money for transportation, the money does not come from the general fund.
More than half of the billion dollars in annual funding for state highways and bridges each year comes from the federal government, each dollar of which comes with strings attached. For example, a certain amount must be spent on Mississippi’s sections of the interstate system, another on road safety and so on.
About thirty percent of the agency’s budget comes in the form of a special fund — the gas tax. For every gallon of gas pumped into a car in Mississippi, an 18 cent tax is charged. This tax revenue goes towards funding hundreds of bridge and highway projects.
Because MDOT cannot use funds that have not already been collected in revenue, it must project revenues for each fiscal year.
For fiscal years 2017 and 2018, MDOT estimates that 43 percent of their revenues will come via federal funds. 25 percent is expected to come from the state’s 18 cent fuel tax. The remainder, approximately $375 million, is expected to come from sources like car tag fees, truck & bus taxes and fees, the contractor’s tax, motor carrier fees, and other miscellaneous state taxes and fees.