Senate leaders spar over how to fund transportation improvements
Source: GSA Business
February 5, 2014
Senate Finance Committee Chairman Hugh Leatherman, R-Florence, said that anything short of increasing the motor fuels tax to fill the gap in road and bridge maintenance funds means doing nothing and jeopardizes South Carolina’s economic development prospects.
But Senate Transportation Committee Chairman Larry Grooms, R-Charleston, opposes increasing the gas tax, arguing that he’d put $300 million from the state’s growing general fund into road improvements.
But Leatherman and Sen. Ray Cleary, R-Murrells Inlet, said that math does not work, because there are too many demands on the other funds.
The legislators appeared together yesterday on a panel at the start of a daylong infrastructure forum presented by the S.C. Chamber of Commerce and the Parker Poe law firm.
All the legislators speaking at the forum said there’s broad agreement in the General Assembly that roads and bridges deserve high priority this year. Arguments are narrowing down to issues such as how to raise the additional money and how much the state should spend each year on the higher level of transportation funding.
S.C. Department of Transportation’s primary source of state revenue is a 16.8-cent motor fuel user fee, the fourth-lowest in the nation. But South Carolina maintains 41,429 miles of roads in the state system, making it the fourth-largest state system in the nation.
One cent of gasoline motor fuel user fee generates approximately $25.2 million, and one cent of diesel motor fuel user fee generates approximately $7 million.
Ray Jones, a Parker Poe attorney and the forum moderator, and S.C. DOT Commission Chairman W.B. Cook outlined the scope of the highway needs:
South Carolina’s population has grown by one million people in the past 20 years.
Port volume is expected to double by 2025.
The state has 8,416 bridges, of which 413 are load-restricted and 10 are closed.
The state’s resurfacing program comprises 355 projects totaling 166 miles and $41 million this year to address those needs. The average cost to resurface one centerline mile for all types of resurfacing is $280,000.
Rep. Tommy Stringer, R-Greer, told the business leaders that the state’s transportation system represents a $328 billion asset, adding that “for the life of me, I don’t understand why the legislature won’t protect it.”
Stringer has introduced legislation that would boost the gasoline tax by 5 cents a gallon and index the tax with inflation in the future.
“The roads themselves will force the issue at some point,” Stringer said. “Some lost opportunity will be a wake-up call.”
Stringer echoed Leatherman’s view that meeting the current and future highway needs with surpluses in general fund revenues is a “mathematical impossibility.”
Acknowledging that Gov. Nikki Haley has said she would veto an increase in the gas tax, Stringer told the audience, “That depends on you.”
Stringer and the other legislators at the forum said that while there is a rising awareness among the public that more road and bridge funds are essential, getting the necessary increases will depend upon how well the business community mobilizes public opinion.
The only way the state can fund highway needs is to increase user fees, Leatherman said.
The Florence businessman and Senate leader said that when he has the opportunity to talk with industrialists thinking about locating a plant in South Carolina, they invariably have two questions: will the state educate the workforce needed to staff the new businesses, and will it provide a transportation system adequate to meet industry’s needs to receive its raw materials and to transport its goods to market.
And, Leatherman added, they say that if South Carolina is unwilling to maintain good highways, then “we are not coming.”
Sen. Cleary also noted the need to raise awareness of the critical need for more highway funds. “At the end of the day, it’s in your ball park to educate the public,” he told the audience.
Rep. Phil Owens, R-Pickens, said that changing technology, such as electric-powered cars, could change the model for financing highways, such as collecting road fees based upon the number of vehicle miles traveled.
But he cautioned that if South Carolina continues to ignore the highway improvement needs and the needs of business, “we are going to be on the losing end of economic development.”
Reach James T. Hammond at 803-726-7545.