February 23, 2011

Lockdown for transportation trust fund examined, questioned

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By Megan Poinski
Megan@MarylandReporter.com

A constitutional amendment that would lock down the money in the transportation trust fund was supported by lawmakers, local officials, business people and petroleum lobbyists – but financial analysts and some delegates questioned why such a measure is needed.

The bill, proposed in the House by Del. Susan Krebs, was debated in front of the House Appropriations Committee on Tuesday afternoon. Krebs, a Carroll County Republican, said that there are myriad transportation needs in the state, and not always enough money to make them happen. Proceeds of the transportation trust fund, which was created in 1971, are meant to be spent solely on transit needs.

money in lockboxHowever, Krebs said, that mandate is often ignored – especially in times of fiscal hardship. According to the report of the Blue Ribbon Commission on Transportation Funding, close to $1 billion has been transferred out of the trust fund since 1984. Gov. Martin O’Malley’s budget proposal for fiscal 2012, now before the General Assembly, would transfer $100 million from the fund for other needs.

The Blue Ribbon Commission report states that Maryland needs about $800 million in new funds to start addressing long-overlooked problems. While bills are being considered to accomplish this through increasing gas taxes and fees, Krebs said that without locking down the fund, there is no guarantee that those funds will actually go to transportation.

Her bill would put a question to the voters in 2012, asking whether they want to amend the state constitution to protect the transit money. If passed, the governor would only be able to tap into the fund in case of natural disaster or U.S. invasion — and then only with the approval of three-fifths of the General Assembly and a plan to pay it back.

The bill would also restore the way the fund was divided between the state and counties and municipalities. Both have seen drastic drops in the amount they receive for transportation.

“Help us bring certainty and confidence” back to the local governments, Krebs said.

Ian Shaw, a Sykesville councilman, said that the town used to receive hundreds of thousands of dollars for roads each year from the state. But not last year.

“They gave us $4,000 to fix roads,” he said. “You can’t hardly fix a snowplow for that money.”

Several others spoke in support of the bill. Del. Neil Parrott, a Washington County Republican, said that from his 12 years of working at the State Highway Administration, he knows the need is real. He cautioned that transportation needs cannot be put off any longer because the roads will continue to deteriorate. A road that needs a new coat of asphalt this year and does not get it may need to be completely replaced in three years, he said.

Drew Cobbs, executive director of the Maryland Petroleum Council, echoed the concerns of local officials, saying they are essentially hamstrung when it comes to needs such as road repair.

“As far as transportation planning stuff, you have to know the dollars are going to be there,” Cobbs said.

Although most voices at the hearing supported the bill, Del. John Bohanan expressed doubts. Bohanan, a St. Mary’s Democrat, said that much of the money taken from the trust fund has been paid back, and that the problem runs deeper. Revenues in all government funds — including the transportation fund — are down, he said.

And, Bohanan said, transportation funds to local governments were cut at the specific request of policy groups. Although, he added, “I don’t think they expected it to be as deep as it was, or to make it permanent, which we did.”

Neil Bergman, of the Maryland Budget and Tax Policy Institute, and Henry Bogdan, of Maryland Nonprofits, also voiced caution on the bill. They both said they understand the desire to preserve transportation funding. However, they said, it is important for the state to be flexible with its funds, something a constitutional amendment does not allow.

“Using the constitution to tie your own hands might be cutting your options to what may be the least painful,” Bergman said.