February 3, 2012

22 senators propose lockbox for transportation funds

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By Daniel Menefee
Dan@MarylandReporter.com

Sen. Rob Garagiola

Sen. Rob Garagiola

After Gov. Martin O’Malley proposed a 6% sales tax on gas to pay for infrastructure projects, Sen. Rob Garagiola and 21 other senators moved to make the tax more salable with a proposed constitutional amendment to safeguard the Maryland Transportation Trust Fund, which governors have repeatedly raided to balance the general fund budget.

“In recent years, the Transportation Trust Fund has been depleted,” Garagiola, D-Montgomery, said in an e-mail. “This legislation proposes a constitutional amendment to create a firewall for current and future Transportation Trust Fund monies. It is critical that we act now to address our infrastructure needs.”

The amendment aims to stop transfers out of the fund and mandate gas tax revenue go specifically to transportation projects — essentially creating a lock box.

But there is an escape hatch that allows transfers from the fund. The governor would have to declare an emergency related to public health or safety, promise to repay the trust fund in five years and get a three-fifths vote of the legislature to approve the transfer.

Garagiola proposed nearly the same constitutional amendment last year, and this year he has 21 co-sponsors, seven more than last year including three Republicans.

The emergency provision drew cynicism from Republican lawmakers. “It’s just another gimmick,” said Senate Minority Leader E.J. Pipkin, R-Cecil. “If the governor wants that money, he can declare a state of emergency for any number of reasons.”

Some lawmakers on both sides insist the current flow of revenue to the fund is adequate for O’Malley’s infrastructure wish list–if the money would just stay put.

Lawmakers see funding adequate

Del. Curt Anderson, D-Baltimore, lamented after O’Malley’s State of the State speech Wednesday that the current revenue stream into the fund is enough for Maryland’s infrastructure needs. He appeared reluctant to support O’Malley’s gas tax but said he needed strict safeguards in place to even consider the tax.

“I would have to be convinced that our Department of Transportation is spending the money we’re giving them correctly,” Anderson said after O’Malley’s address. “There are audits out there that show the State Highway Administration has really screwed up the spending of this money…why give them more money for infrastructure when they can’t even spend it [correctly now].”

Del. Jay Jacobs, R-Kent, and Charles Otto, R-Somerset, said they would not support a “lock box” amendment in the House if language on “exceptions” wasn’t removed. They also said that too much of the Transportation Trust Fund goes to mass transit projects in the state.

“The original intent of the fund was for highways and bridges, not mass transit,” Otto said.

“This is one of the few states in America that combines highway projects with mass transit,” Jacobs said. “The governor has aggressively tried to fund $2 billion in mass transit projects over the last three years. The money is obviously being diverted away from highways. Every year you forgo maintenance, it just gets more expensive.” He said mass transit funding should be separated from the Transportation Trust Fund.

A plan to restore local aid

Garagiola offered a related bill  that increases the local share of highway user-funds from 10% to 25% by 2016.

“Maryland needs to begin the process of restoring this vital funding to our counties and municipalities,” Garagiola said. “Marylanders do not distinguish importance between state and local roads.  At a time when our local governments are also struggling to balance their budgets, we have taken essential funding from their own equally critical transportation projects.”

Historically, county and municipal governments got 30% of the Transportation Trust Fund revenues. The percentage shrunk to 10% over the last two years due to transfers to the general fund. The proposal keeps local governments’ share at 10% in FY2013 but increases it to 25% by FY2016.

  • Pingback: Bills Introduced to Provide Transportation “LockBox” and Restore Local Share of Highway User Revenues « Conduit Street()

  • Anonymous

    A lock box will not secure the funds nor make it any more palatable to taxpayers. Excessive mass transit subsidies need to be drastically reduced. Raise tolls, double vehicle fees, levy a sales tax on top of a gasoline tax=higher costs for EVERY consumer whether they drive a car/truck or not.

    •  Abby,

         I’d believe in a “lockbox” if the “lockbox” wasn’t under the control of the Legislature ! We can’t afford O’Malley’s dreams ! Cut ALL spending on transit “dreams”, do only what’s necessary. From the look of things, I;d like to see a forensic audit of the Transportation Dept. for the past 5 years, find out who raided it, “clawback” the money, and prosecute the “raiders” !

  • party

    the govenor is part of the one pecrcent , please make him  president so he can ruin the country too and we can all move to canada or maybe even mexico or china .to find a low paying job for an american co that has moved over seas.

    • I am not one to support the Occupy movement but they are right when you have the majority (if not all) of lawmakers comprising the top 1% of the population with regard to wealth.  I can see why they are angry.  I do not condone the violence, their methods or lack of clarity and focus.  There are better ways to go about changes.  What’s most interesting is that the tea party and the occupy movement have a great deal in common.  Both were against the bailouts, both want to hold government officials responsible and both would probably push hard for term limits.

  • Brichbourg

    This is just a smoke screen to justify higher taxes. The Governor and the Senate has no intention of creating a real lockbox. Why don’t they have the general fund reimburse the transportation fund for the money that was raided and spent by the general fund.

  • star2002

    I do not support the increase but if it passes, they should restore the local funds immediately and return what they have taken during the last several years as well over the next five years.. 

  • The truth is that the transportation fund has been raided on and off for the last 27 years.  Many times it has been paid back however times are tight and the money to pay it back is no longer there.  Transportation funds should be used for transportation infrastructure like it was meant to be.  To raid these funds like it is a bank account is nothing short of criminal especially when the taxpayers have to make up the difference and during an economic downturn.  Now is NOT the time to be raising fees, tolls and taxes.  People are struggling and unemployment is at an all time high.  The simple truth is that most of us just cannot afford it.