Arizona transportation officials told the State Transportation Board last week that, faced with declining revenue, it can no longer afford new freeway construction and upkeep at current levels.
“We have a daunting task in front of us,” said Victor Flores, the chairman of the board, after learning the Arizona Department of Transportation will lose $350million in highway revenue over the next five years.
Beyond Friday’s Transportation Board hearing, momentum has been growing to raise more cash for highways, trains and buses. In recent weeks, there has been a series of public pronouncements about advancing new or renewed ballot measures. Today, the Arizona chapter of the Associated General Contractors of America is convening a private meeting in Phoenix to discuss transportation funding.
Last on the agenda: “Brainstorm and Develop a Transportation Stakeholder Action Plan,” which could mean discussion about a bond measure.
Next year “is the year of infrastructure in Arizona, specifically transportation infrastructure,” said Martin Shultz, who has been a key figure in every major regional transportation measure in metro Phoenix for 30years.
Shultz is senior policy director at the law firm Brownstein, Hyatt, Farber and Schreck. He will be at today’s gathering along with state lawmakers, ADOT Director John Halikowski and the Arizona division administrator for the Federal Highway Administration.
The meeting is one of several signs that indicate a growing interest in asking voters to pay for more transportation. Those signs include:
On Wednesday, regional governments of Maricopa, Pinal and Pima counties held a conference to discuss the Sun Corridor, a demographer’s name for the expected rapid growth around Interstates10 and 17 from Tucson to Prescott. One idea is a three-county transportation bond.
Last month, Phoenix Mayor Greg Stanton told the Friends of Transit conference he wants to renew the city’s transit tax to build light rail to Metrocenter Mall and south Phoenix. Mesa Mayor Scott Smith and Avondale Mayor Marie Lopez Rogers also spoke about the need for regionwide transit integration amid widespread talk of renewing a countywide measure.
Last year, Gov. Jan Brewer, the Arizona Commerce Authority and a panel convened by the governor, the Arizona Transportation and Trade Corridor Alliance, all expressed support for a proposed new interstate, according to minutes and correspondence obtained under the state Public Records Law.
All of this funding talk is “not a coincidence,” Shultz said, who favors a statewide bond. “It’s coming to a crescendo.”
It’s also following a natural 10-year cycle of requests for a regional transportation tax. Maricopa County voters passed the first such measure in 1985, rejected it in 1994 and renewed it in 2004.
Funds dwindling
Twin forces are driving the conversation. One has to do with calls for new, big and unfunded projects. The other is deepening fiscal gloom, despite the brightening economy.
Last year, Congress designated a new Interstate11 to connect Phoenix to Las Vegas using mostly U.S. 93 and a new route through the desert far west of Phoenix. Power brokers in both cities back the idea. They succeeded in getting I-11 on the official map, but there is no money identified for a project that will cost billions of dollars.
Likewise, the Maricopa Association of Governments teamed up with counterparts in Las Vegas, Denver, Salt Lake City and other Western cities to push for a high-speed rail connection in the mountain states. Again, no money was identified for those links when the Obama administration unveiled its plans to stimulate the economy with bullet trains. Each leg would cost billions of dollars.
In December, ADOT unveiled its first detailed plan to connect Phoenix and its suburbs to Tucson with conventional passenger rail. The public-hearing process is proceeding, and a final plan is expected at the end of the year. No funding exists for a plan that would need hundreds of millions of dollars.
At the same time, the funding picture is darkening.
According to the draft five-year plan unveiled for Friday’s board meeting, 2011 was the peak year for highway spending in Arizona. For years, gas-tax revenue has been sliding, but the workhorse of the highway program has been Maricopa County’s 2004 sales-tax measure, Proposition 400.
Every year, the Legislature directs state highway funds to the Department of Public Safety. This year, $127million will be redirected.
Congress has been paralyzed by partisan fighting over taxing and spending. A routine and uncontroversial transportation-spending plan was delayed more than 21/2 years. Instead of a six-year funding bill, Congress passed a two-year version without boosting highway funding.
Meanwhile, the gas tax continues to lose punch. Because of inflation, fuel efficiency and, recently, less driving, a dollar of gas tax buys only what it could in the early 1970s. On Friday, ADOT economists reported that the gas-tax revenue for this year is behind last year’s projections.
Tough choices ahead
Overall, ADOT’s share of gas-tax spending is at 2004 levels and isn’t going to recover, ADOT Planning Director Scott Omer said.
“We’re staying at that level, and we’re bouncing around at the bottom. We have to adjust our program,” he told the State Transportation Board.
Omer noted that every dollar spent on maintenance saves $5 on repairs later. Some estimates put the ratio higher. It was an argument to keep the freeway system Arizona has built in good condition before it gets too old in too many places.
“It’s like a car. If you don’t invest in that vehicle, it will break down later,” he said.
He presented three options. One would focus on maintenance. It would direct $184million a year to upkeep and keep pavement in good shape until 2031, but only one of nine major projects would get built to add capacity. Option 2 focuses on the nine enhancements, but freeways start to degrade below acceptable standards by 2017. A compromise third option would maintain pavement until 2021 and build four of the nine priority projects.
Under any scenario, ADOT will have to defer major projects. The $2billion South Mountain Freeway extension of Loop 202 would be pushed back one year, for instance.
“I believe the solution is the public itself,” ADOT Director Halikowski said. “They need to make the decision and to be convinced that the investment in transportation infrastructure is a good use of public money.”
