A political football in state transportation debates for the past two years — the concept of a mileage-based tax on motorists — apparently is no longer even a subject of research at the Connecticut Department of Transportation.
The tax has been the subject of sporadic political jabs between Republicans and Democrats at the Capitol since word first broke two years ago that the DOT was researching this revenue-raising option.
But Transportation Commissioner James Redeker wrote last week in a letter to a regional transportation coalition that was coordinating research into this tax that his agency was halting its involvement because of budgetary issues.
“I regret to inform you that the state of Connecticut must withdraw from the coalition’s project on mileage-based user fees in a multi-state region,” Redeker wrote to the I-95 Corridor Coalition. “I continue to believe this collaborative effort is a great opportunity to learn and gather critical information about a potential future revenue source. Unfortunately, the Connecticut Department of Transportation is now facing large budget cuts that prevent us from providing any state matching funds.”
Redeker added that the DOT was withdrawing “with great reluctance.”
The coalition is an alliance of state transportation and public safety agencies, toll authorities and related organizations along the Atlantic coastline from Florida to Maine. It provides research and policy development on transportation issues.
Connecticut’s aging, clogged transportation network faces a wide array of challenges, including a lack of funds to address these and other problems.
Gov. Dannel P. Malloy came forward two years ago with a plan to spend $100 billion over 30 years to rebuild and transform highways, bridges and rail networks.
But Malloy also has refused to press for tolls or any other mechanism to pay for most of this work until legislators back a constitutional “lockbox” amendment to safeguard those revenues.
Still, after Senate Republicans learned the DOT was studying a mileage tax, they quickly denounced it. Senate Democratic leadership joined it, saying they opposed it as well.
Meanwhile, DOT officials said they simply were gathering more information on a revenue option many other states are studying to reduce reliance on gasoline taxes. Gas levies are slowly shrinking in value as more fuel-efficient vehicles are produced.
“I am pleased that the DOT has finally pulled the plug on the mileage tax study,” Senate Majority Leader Bob Duff, D-Norwalk, said Tuesday. “It was clear from the outset that the Senate Democrats opposed the mileage tax study. I am glad that the DOT is seeking to reprioritize these funds in order to address critical projects.”
“It’s about time,” Senate Republican leader Len Fasano of North Haven said. “The mileage tax was always a bad idea for Connecticut, and Democrats spending money on a pilot program for a new tax they swore up and down they didn’t support never made any sense. This issue could have been resolved months ago if Democrat lawmakers would have joined Republicans to vote against piloting the tax last session, but they refused. Nevertheless, I am glad to see Connecticut finally withdraw from the program and Democrats joining Republicans in claiming victory.”
Still, Connecticut has no long-range plan to fund its transportation infrastructure needs.
To cover the first five years of the governor’s 30-year rebuilding program — 2016 through 2020 — Malloy proposed and secured approval to replace an older system of sharing General Fund resources with the Special Transportation Fund with a more generous plan to shift sales tax receipts into transportation.
But things have bogged down since then.
In January 2016, a gubernatorial panel laid out $42 billion in revenue options — including tolls and gasoline tax increases — to fund the remaining 25 years of the governor’s transportation program. But Malloy’s insistence on a lockbox has hindered the progress of any of those revenue-raising ideas.
That lockbox remains a point of contention among many lawmakers from both parties.
Further complicating matters, there is mounting evidence there isn’t sufficient funding even to cover the initial five-year start of the transportation program.
Nonpartisan analysts warned last year that the Special Transportation Fund was projected to run $46 million in deficit beginning with the 2018-19 fiscal year — Year 4 of the 30-year program.
Now it looks like it won’t even make it through its second year in balance.
Legislators decided last May to cut this fiscal year’s sales tax transfer by $50 million to help close a major deficit in the General Fund.
The governor’s budget staff estimated last month that the Special Transportation Fund would finish this fiscal year $17.3 million in deficit.
And while the fund has a $142 million reserve, which could cover deficits for a few years, transportation advocates insist the program needs more resources now.