As part of the interim charge by Speaker Dennis Bonnen, the committee was tasked with investigating whether “the current mix of use fee-based funding for the state highway system, including registration fees, tolls, and fuel taxes, and [determining] if current funding generated is sufficient to maintain cost demands” — making recommendations for additional methods for funding road infrastructure projects.
Ordinarily, the committee would hold meetings and receive testimony from relevant state agencies and interested citizens and groups regarding transportation funding.
However, this year, only written testimony will be received, which must be submitted by September 18.
Recently, the Texas Association of Business (TAB) launched “Keep Texas Moving” as a coalition to encourage private funding of roads. The website says, “Texas should welcome and harness private investment and managed toll lanes,” as a way to help with highway congestion.
The group is hosting meetings around the state with many local chambers of commerce to promote its ideas.
In Lubbock recently, Aaron Cox, senior vice president of TAB, said, “…it’s time that Texas again look to the private sector, public-private partnerships and solutions like optional toll lanes to address the serious funding shortfall facing our state’s transportation system.”
He pointed to the anticipated $5 billion budget shortfall recently announced by Texas Comptroller Glenn Hegar adding that “[a]llowing private investment for major highway development would offset state revenue losses…”
The Texas Department of Transportation (TxDOT) is not currently authorized to use private financing. In his State of the State address in 2015, Governor Greg Abbott recognized the congestion on Texas highways but proposed a budget “without raising taxes, fees, tolls or debt.”
In its legislative appropriations request for the upcoming biennium, the Texas Department of Transportation is asking for $32.68 billion, most of which “supports only highway projects.”
Texans United for Reform and Freedom (TURF), however, opposes public-private partnerships and says they are not needed to provide for highway funding as claimed by others.
TURF founder, Terri Hall, sees the economic downturn as an opportunity for those who support toll roads to push their agenda, but she believes taxpayers strongly oppose this.
“Texans have consistently and loudly rejected…any corporate takeover of our public infrastructure for good reason. The reality is [comprehensive development agreements] are the most expensive way to fund roads at a time when taxpayers can least afford it.”
Hall points out that ballot measures passed in recent years made available more state money to construct and maintain public highways on a pay-as-you-go schedule, and demonstrate that voters don’t support construction of more toll roads.
Voters approved a constitutional amendment in 2014 which dedicated part of the oil and gas production taxes, also known as severance taxes, to the State Highway Fund (SHF). According to the Texas Department of Transportation, between 2015 and 2019, over $7 billion was deposited in the SHF due to this constitutional amendment.
The next year, another constitutional amendment passed that allows part of the sales and use tax revenue to be dedicated to highway funding, resulting in another $7.5 billion of additional funding for the State Highway Fund.
“It’s time to tighten your belt,” Hall submitted to the committee in her written testimony. “That may mean projects are delayed or phased differently,” adding that taxpayers expect their government to exercise “fiscal restraint and proper project management and prioritization.”
The North Central Texas Council of Governments Regional Transportation Council put out a fact sheet this summer encouraging local governments to consider ways they might raise additional transportation revenue.
Suggestions included adopting a $10 optional vehicle registration fee or enacting regional transportation reinvestment zones. These zones, established by local governments, dedicate incremental increases in property tax revenue within the zone to finance transportation projects.
It also suggested a user fee for electric vehicles to “offset the lost fuel taxes.” Texas taxes gasoline at 20 cents per gallon currently, while the federal government imposes an 18.4 cents per gallon tax.
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Kim Roberts is a reporter for the Texan in the DFW metroplex area where she has lived for over twenty years. She has a Juris Doctor from Baylor University Law School and a Bachelor's in government from Angelo State University. In her free time, Kim home schools her daughter and coaches high school extemporaneous speaking and apologetics. She has been happily married to her husband for 23 years, has three wonderful children, and two dogs.