What-ifs cause concern for state’s transportation
Costly facts-of-life such as emergency repairs, regulatory compliance, inflation and more can be stressful nuisances.
Pair those with changing legislation, litigation and other factors that could cost billions over the years, and there’s a disaster in store.
The state Transportation Advisory Committee developed a report showing that the state Department of Transportation just may be heading for disaster.
“Now the storm cloud’s brewing,” said Mark Murawski, a member of the committee and a Lycoming County transportation planner. “I am not saying that this is a done deal or it’s definitely going to happen, but the threats are real.”
The committee report “creates a perfect-storm scenario” by identifying current levels of funding and estimated funding needs, identifying strong risks and the potential cons faced should those risks become reality.
PennDOT is working with a budget of about $8.5 billion — a one-year figure, Murawski said.
Each year, maintenance and repairs for interstate highways and bridges cost about $2.5 billion; the National Highway System is about $1.8 billion. Public transportation gets about $1.2 billion, he said.
In addition to slough of cost pressures, such as emergency repairs, inflation and many more contribute to costs growing annually, the report details five real threats that could lead to a nose-dive in funding for PennDOT.
The first threat is a reduction in federal funding, Murawski said.
The federal Fixing America’s Surface Transportation Act expires next year and the Highway Trust Fund is expected to go bankrupt by 2021 unless Congress takes action.
“We really don’t know what’s going to happen here at the federal level,” he said.
Without any actions taken, federal funding to Pennsylvania could reduce cumulatively by about $6 billion over a 12-year period, he said.
Another threat is the potential repeal of the vehicle sales transfer tax provision, which would start in 2022-23 if approved.
“That would be a hit to public transportation funding to the tune of possibly $3.6 billion over 12 years,” Murawski said.
Third, litigation against the state Turnpike Commission by truckers stating turnpike tolls should be used only on the turnpike is moving forward, he said. A judge may pass ruling soon.
“If the litigation (goes through), it would prevent payments from the Turnpike Commission to, again, the public transportation trust fund,” he said, adding it could reduce that fund by $2.2 billion over 12 years.
In addition, if Act 89, known as the gas tax, is extended for another five years as-is, the Turnpike Commission still would be required to pay $450 million annually to that trust fund despite its loss of revenue, incurring more than $2 billion in new debt.
“Their debt accumulation is becoming a serious problem,” Murawski said.
The implications could include about 60 percent of all the commission’s revenue going toward debt service, meaning increased tolls — which drivers can avoid by taking other routes.
“They start losing market share the more their fees go up, and that would then undermine their ability to keep the system properly maintained,” he said.
The fourth risk revolves around the controversial issue of state police withdrawing funds for their budget from the motor license fund.
Legislation was enacted that forces the state police to take incrementally less over 10 years. However, the fiscal code may be amended in a way that halt’s that process, allowing the state police to continue withdrawing more, Murawski said.
Those losses could add up to $1.8 billion or more over 12 years.
“It’s small, but it’ll make a big difference in the end,” he said.
Finally, motor license fund tax receipts may reduce due to declining sales of motor fuels and vehicle license fees, which could result in a loss of about $4.9 billion over those 12 years, Murawski said.
“When you add up all the threats, if a perfect storm did occur, you end up with an $18.5 billion impact to PennDOT’s budget over a 12-year period of time,” he said.