Will Lamont keep transportation system afloat until toll receipts arrive?
Gov. Ned Lamont’s proposal to toll all vehicles would dramatically infuse Connecticut’s aging, overcrowded transportation infrastructure with new cash — three or four years from now.
But Lamont’s recently announced “debt diet” would immediately cancel hundreds of millions of dollars in potential borrowing for transportation — to help solve larger problems in Connecticut’s finances.
So as he urges support for tolls on Connecticut’s highways, the governor also must convince people he will keep the state’s cash-starved transportation rebuilding program afloat.
“I think scaling back right now would be catastrophic,” said Donald Shubert, president of the Connecticut Construction Industry Association.
Shubert’s group praised Lamont for his decision Saturday to propose tolls on all vehicles, which could raise $800 million to $1 billion annually for transportation. It is anticipated about 40 percent of those proceeds would come from out-of-state motorists.
The governor received similar accolades from construction unions.
But David Roche, president of the Connecticut State Building Trades Council, agreed with Shubert that the state can’t afford to backtrack — even for a few years — on maintaining an aging, overcrowded transportation network.
“I really don’t believe we can have less money going into transportation,” even for a few years, Roche said, adding that residents who are wary of tolls may not fully understand how worn down Connecticut’s infrastructure is. “They really don’t understand how bad the bridges are,” he said. “They are a mess. It’s a safety issue to me right now.”
A 2017 report by the American Road and Builders Association warned that 33.5 percent of Connecticut’s bridges are either structurally deficient or functionally obsolete. It also said that 57 percent of roads eligible for federal aid are rated “not acceptable,” which is the second-highest percentage among all states.
Former state Transportation Commissioner Emil Frankel, who served under Gov. Lowell P. Weicker Jr. from 1991 until 1995 — and who now works as a transportation consultant — also applauded Lamont’s position on tolls.
“I think scaling back right now would be catastrophic.”
— Donald Shubert
President, Connecticut Construction Industry Association
But in a joint statement with Shubert, Frankel wrote that “in the meantime, as Connecticut works toward developing long-term solutions, it is essential that adequate revenues continue to flow into the Special Transportation Fund to support the operating costs and bonding levels required to maintain the currently programmed projects, systems and services.”
Though he pledged on the campaign trail last fall only to recommend tolling on trucks, Lamont reversed himself Saturday, saying it would be highly unlikely Connecticut could do this and afford the transportation upgrades needed to support long-term economic growth.
“Beyond an inconvenience, the crushing congestion we experience on I-95, I-91, I-84 and the Merritt Parkway, in particular, is a real challenge we must address and overcome if we are to maximize our economic development potential,” the governor wrote in a weekend op-ed piece. “Our proximity in mileage to New York City means nothing if it takes 90 minutes to get there from Stamford on the road, and over an hour by train.”
The problem Lamont faces, though, is that the state budget’s General Fund — which covers about 90 percent of all operating costs — is arguably in worse shape than the transportation program.
Lamont, whose first budget is due Wednesday to legislators, must offer a plan to avert a potential $1.5 billion shortfall in the coming fiscal year, and a $2 billion potential deficit in 2020-21.
Further complicating matters, the new governor wants to close those gaps without raising the state income tax and while delivering property tax relief to poor and middle-class households.
Part of his budget fix involves reining in Connecticut’s credit card. Lamont proposed a “debt diet” for general obligation borrowing. G.O. bonds, which are repaid using receipts from the income tax and other proceeds of the General Fund, are the principal tool used to finance municipal school construction and capital projects at public universities.
But slamming the brakes on this borrowing also has big repercussions for transportation.
Lawmakers put a ‘patch’ on transportation system
Legislators couldn’t agree in 2017 or 2018 on tolls, despite repeated warnings from then-Gov. Dannel P. Malloy that the transportation program was running short of cash and could do little more than basic maintenance.
As a compromise, lawmakers put a financial ‘patch’ on transportation to buy a few more years until a long-term solution could be found.
One section of that patch involved dedicating a portion of the school construction credit card — up to $250 million per year in G.O. bonding — to support transportation projects.
That would supplement the regular transportation borrowing program — about $750 million to $800 million per year — repaid from the budget’s Special Transportation Fund, which largely is supported with fuel tax receipts.
State borrowing for transportation is absolutely crucial because it qualifies Connecticut for more than $700 million-plus per year in federal transportation grants.
As a second part of the 2017-18 compromise, legislators agreed to speed up a planned transfer of sales tax receipts from the General Fund into the Special Transportation Fund.
The transportation program is expected to receive, on average, an extra $133 million annually over the next two fiscal years.
Lamont’s first budget, will have to decide whether to maintain those transfers.
By a nearly nine-to-one margin, voters last November ratified a new amendment to the state Constitution creating a legal “lockbox” to protect transportation funds for being used for other purposes.
But that provision applies only to resources credited to the transportation fund after the amendment’s ratification. And those resources aren’t earmarked to arrive in the transportation program until the next fiscal year begins on July 1.
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