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Road Wage: MoDOT’s Bleak Funding

Road Wage: MoDOT’s Bleak Funding

I’ve paid about $26 into Missouri’s transportation system in the last month. That’s a rough estimate I made using the calculator hosted on the Missouri Department of Transportation’s website — I figure I’ve driven about 16,000 miles in the last year (which is about 3,000 above average), and I’ve filled up only at gas stations in Missouri. At my car’s average MPG of 21, and with Missouri’s fuel tax rate of 17.3 cents per gallon, I pay the State of Missouri about $26 per month, which then goes to MoDOT. Since I didn’t register a vehicle or buy a new car in the last year, that’s all I pay — $26.

Here are some other things I’ve spent $26 in the last few months: a keg tap (bachelor party I was planning); a cheap foam football ($17, incredibly) and a Lindenwood University pennant ($9); the video game “MLB 2K11”(which costs $13 but I had to buy twice, after I threw it in the garbage in a fit of frustration once); four 10-piece Chicken McNugget meals with large Diet Cokes from McDonald’s (I’ve actually bought more than four — don’t judge); and a T-shirt featuring a catchphrase from one of my favorite podcasts (it’s a great shirt, but it doesn’t fit me). I could go on. The point is: I spend $26 on a lot of things that are inarguably stupider than keeping the state’s transportation infrastructure from falling into disrepair, which is something it’s doing in every community in Missouri. You probably do too.

For the last decade or so, MoDOT has been using stagnating revenue to meet a constantly growing list of demands. The department says they have just enough money now to maintain the status quo, so to speak: to fix high-priority projects before they fail. Missouri’s transportation system has the seventh highest number of highway miles in the country, but the state’s fuel tax — MoDOT’s biggest and most consistent single source of revenue — is the fourth lowest of any state. (It was last increased in 1996, part of an incremental increase passed in 1992.) Given the rate of innovation in fuel efficiency and electric vehicles, fuel tax may be a moot point in 20 years anyway. But Missouri’s roads and bridges are getting older regardless. They’re breaking down. Everybody knows it, from the state legislator reading through the budget to the small business owner with a pothole by their front door. But it’s proven difficult to convince people to pay more than $26 a month to help.

Cracks in the Foundation

Patrick McKenna, MoDOT’s current director, moved to Missouri in December 2015 from New Hampshire, where he was the deputy commissioner of that state’s DOT. All funding issues aside, he had his work cut out for him with Missouri’s transportation system.

“It’s massive. That was my first impression,” McKenna says. “Just the breadth, and the multimodal nature of it — it’s really all modes of transportation working together.”

Missouri is home to not only one of the country’s largest highway networks, but also five airports, two of which are international; a robust freight rail system; a wide and winding network of rural roads; and some of the nation’s busiest inland waterways. For being squarely in the middle of flyover country, Missouri plays an outsized part in moving stuff.

McKenna also came aboard in the darkest days of MoDOT’s funding crisis — when he accepted the job, the department was working under its “325 System,” a plan the Missouri Highways and Transportation Commission, which governs MoDOT, adopted in early 2015. The name was a reference to the expectation that MoDOT would only have $325 million in construction funding for road projects. The system as a whole, they estimated, cost $485 million just to maintain in its current state.

A number of different factors contributed to the shortfall: the diminishing power of the state’s fuel tax; the absence of a federal transportation spending bill for the following years; the state’s registration fee system (which is even more outdated the fuel tax in some cases) failing to keep up with inflation; and declining state revenues, which meant Missouri might not be able to match any federal money that MoDOT was able to get. The department turned to some cost-saving measures, including accepting more flexible construction plans, like design–build and practical design, and reducing spending on staff, facilities, and equipment. Under the 325 System, the State Transportation Improvement Program, which is prepared annually and stipulates all of MoDOT’s construction projects for the next five years, prioritized funding for only the most critical points in the state’s system.

“I walked in when the official STIP in place was 2016 to 2020, and it didn’t have the resources to maintain 26,000 out of 34,000 miles of roads in this state,” McKenna says. “So the official plan in this state for four years was the abandonment of three-fourths of the state’s roads.”

McKenna did run into a bit of luck when he first arrived: the FAST Act, the first federal transportation spending bill since 2005, was signed into law the same month he accepted the MoDOT job, and state revenues finally began to pick up following the recession. The highway commission formally abandoned the 325 System in its first meeting after McKenna took over.

In the years since, MoDOT has been able to add $4 billion in the STIP’s capital budget. This allowed for critical infrastructure improvements around the state, like the I-70 bridge replacements in Columbia that wrapped up in 2016. MoDOT still lacks the funding for more ambitious construction plans, but the imminent crisis has been averted.

But the same systemic problems that wrought the 325 System still exist, unchanged. The FAST Act only lasts through 2020, meaning that the U.S. Congress will need to reach an agreement, which will likely have to be bipartisan, on a new bill sometime in the next four years. The state still faces the same problem with its registration fees. And, most importantly, the state’s fuel tax remains unchanged. If another recession were to strike Missouri, it would likely trigger all the same consequences for the state’s transportation funding model — only this time, the model will be a decade further out of date.

Facing the Fuel Tax

A fuel tax increase gets proposed regularly in the state legislature. No version of an increase has passed. The most recent effort came this past April, when the State House of Representatives voted down a six-cent increase 51-103. Not that it would have mattered much: because the tax would have generated more revenue than the state is allowed without voter consent, the increase still would have had to be approved by Missouri citizens, who haven’t shown much interest in tax increases. The last transportation-funding ballot issue that came to the public was a 2014 constitutional amendment that would have generated $5.4 billion dollars for transportation projects over 10 years using a ¾-cent increase in sales taxes. It was defeated with 59 percent of the vote.

That’s not to say that Missouri citizens don’t understand the problems with the state’s transportation infrastructure. Road and bridge improvements aren’t only a popular idea; they’re demanded in every community in the state. “We visit different localities every month and listen to the concerns of the citizenry,” says current highways commission chairman Michael Pace. “And, generally speaking, they’re not unique. Everyone is generally preaching the same song: our system is not broken, but it is bent. And people ask us to fix [their local roads], and we just have to buckle up and say we don’t have the funding to do that. And that’s a hard pill for some of these people to swallow.”

“People don’t like to pay taxes, plain and simple,” McKenna says. “They want to know they’re getting good value from the dollars they pay, and in many cases, they want to be sure that the improvement that they’re looking for will happen three days after a gas tax is passed.”

The local dynamics of infrastructure problems make a fuel tax increase arguably more difficult for Missouri to pass than, say, a cigarette tax increase. There’s a saying that the biggest pothole in town is always the one you drive over on your way to work; if that’s true, then the smallest pothole in the state is the one that you didn’t even know existed, and you’d be understandably annoyed if you found out that was the one getting repaired. If someone in Centralia votes to increase fuel taxes so MoDOT will have money to make improvements on Highway 22, then they might feel their money is being wasted if MoDOT were to, say, start the process of widening I-70 instead.

And of course, focusing on fuel tax increases is probably not a viable long-term strategy anyway. In a particularly bleak financial document published in 2012, MoDOT officials wrote, “Simply stated, the fuel tax model that has been used to fund transportation in this country for many, many years does not work anymore.” While Missouri’s fuel tax collections have rebounded from their lowest point during the recession, they still haven’t reached the same level they were at in 2005, McKenna says. Pace believes that gas-powered vehicles will be a relic on the roads within a few generations. “Obviously, we have to come up with another mechanism,” he says.

So what then? If Missouri either can’t pass a fuel tax increase or can’t gather enough revenue from a fuel tax for it to matter, what long-term solutions are there for transportation funding? McKenna, at an event earlier in the fall, said that MoDOT was studying the possibility of raising user fees on electric hybrids and other fuel-efficient vehicles to offset the stagnation in fuel tax, but he also said any changes aren’t imminent and wouldn’t offset the tax anyway. (Changes would also probably be unpopular — Oregon is currently the only state to impose a financial penalty on owners of fuel-efficient cars, which it does through a yearly fee ranging from $18 to $110.) Some state officials, including former Governor Jay Nixon, have wanted to explore making I-70 a toll road, as it is in the western part of Kansas, but that idea likely won’t make it much further; the political group A Better Road Forward submitted a ballot issue for 2018 banning toll roads throughout the state. At an October meeting of the 21st Century Missouri Transportation System Task Force, a group of private citizens and lawmakers, Sen. Bill Eigel, of St. Charles, suggested that the state move more money from its general fund over to MoDOT as part of a broader budget overhaul, but that would likely be both politically and mathematically impossible — state funding currently makes up less than one percent of MoDOT’s revenue.

There are other longshot possibilities to help too. A hyperloop — a high-speed tube transportation system that is, so far, mostly theoretical — between Kansas City and St. Louis would take a significant load off of I-70. (MoDOT joined the Missouri Hyperloop Coalition, a group of organizations advocating for such a project, earlier this year.) Or the state could cross its fingers and hope for a generous federal funding package — in 2016, then-candidate Donald Trump touted a $1 trillion infrastructure plan as part of his presidential campaign, but there’s been little push for the plan in the last year.

At the task force meeting in October, by the way, most members viewed a fuel tax increase as the best bet to fund the state’s transportation system moving forward, particularly in the short term.

“Where the momentum has built is in the education process in the state legislature,” Pace says. “I really believe that, in the time I’ve been on the commission, we’ve increased the education pertaining to transportation in the legislature 10-fold. There’s not a soul over there who doesn’t understand what we’re going through, our problems. The problems are with those who have taken the no-new-tax pledge, and they absolutely will not vote for a new tax of any sort, and that really hamstrings the process.”

Building Bridges

In September of this year, MoDOT finally had the funding to begin construction, in concert with the Illinois Department of Transportation, on a replacement for the Champ Clark Bridge, which crosses the Mississippi River in Louisiana, Missouri, in the northeast part of the state.

The bridge was built in 1928, and it was built for the cars of 1928 — an inspection in 2014 found “structural deficiencies” in the bridge that led to weight limits for vehicles crossing it. Illinois was ready to fund a replacement project, but Missouri needed time to catch up. MoDOT only now has the money needed for the replacement, which will take two years to build. McKenna hopes they don’t have to close the existing bridge before they open the new one. It’s a 77-mile detour if they do.

“These kind of things could cause, literally, the destruction of two communities economically,” McKenna says. “And we do need the public’s assistance in that. If the public is unwilling to adjust the rates as they are today, we will not be able to keep paying for everything that needs to be replaced or repaired. And there will be facilities that we have to close for reason of disrepair.” CBT

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