Recent headlines in CTMirror read, “Builders, trades, launch new ad to push for tolls on CT highways.” The Home Builders and Remodelers Association of Connecticut (HBRA-CT) does not count itself among this coalition nor has it endorsed the implementation of tolls on our highways.
HBRA-CT is a statewide trade association of small businesses whose members are responsible for 70 to 80 percent of all residential construction in Connecticut in a given year.
While our association has not taken an official position on the tolls question, I would personally suggest policy makers to think long and hard about the potential ramifications to our industry and consequential impacts on housing accessibility and affordability before tolls are implemented.
We understand that roads and infrastructure need repair, but in the end, at least with respect to the residential construction industry, is there a less onerous way forward? As mentioned in a 2017 report produced by the Congressional Research Service, “One obstacle to increased use of tolling is that tolls are a relatively inefficient way of raising revenue. The costs of toll collection on many existing toll roads exceed 10 percent of revenues even if all tolls are collected electronically, not including the cost of toll collection infrastructure.
This compares unfavorably to the cost of collecting the existing federal motor fuels tax, estimated to be less than 1 percent of revenues.
On any given day, numerous deliveries can be seen coming and going from active construction sites across Connecticut. The additional costs to our friends in the motor transport industry will be passed through to the builder and developer, leading to increased costs associated with the improvement of both the raw land and the construction of home. The builder will pass through those costs.
Finally, the homebuyer will shoulder the brunt of those additional costs in the form of higher home prices. What does this mean? Each home takes four to six months to build with close to one thousand worker–days and well over one hundred deliveries. Reasonable estimates show that the implementation of tolls could impact the price of a new home by 1- 2 percent depending on the location. That would mean a new home built today at the cost of $350,000 will cost an additional $3,500 – $7,000 to build.
Couple this with the fact that the 2019 Annual Report produced by the National Association of Home Builders titled, “Priced-Out” claims for every $1,000 the price of a new home is increased in the state of Connecticut, 696 families are priced out of the market. Ultimately, fewer homes will be built placing greater strain on the resale market and making homeownership less attainable for more Connecticut residents. Fewer affordable home options drive businesses to grow elsewhere.
Single-family housing permits which are tracked by the U.S. Census Bureau show that our Connecticut housing industry has been at deep recession levels since 2009. Single-family housing starts have not broken 2,500 in 12 years. In contrast, prior to the 2008 recession when our industry was experiencing normal market trends, we saw averages of nearly 10,000 new single-family homes a year. New homes are being produced at only a fraction of what is needed just to maintain Connecticut’s current housing stock numbers.
With one of the oldest housing stocks in the country and a workforce population that, in many parts of our state, finds it necessary to commute significant distances to the new homes being built, is this really the right time to increase their commute costs and place even greater strains on housing affordability in Connecticut?
Chris Nelson is President and Chairman of the Homebuilders & Remodelers Association of Connecticut.
CTViewpoints welcomes rebuttal or opposing views to this and all its commentaries. Read our guidelines and submit your commentary here.
I will respond the same way I respond to anyone that says they oppose tolls. Ask yourself these three questions:
Do you think that our roads are fine the way they are?
Do you think that a dollar today buys the same things it bought +20 years ago when the gas tax was last raised?
Do you think it is okay that Connecticut residents should continue to
pay for our roads while out-of-state drivers use them for free?
If you answer “no” to any of these questions then you better rethink your opposition to tolls because one way or another we need to address our transportation funding now or in the near future.
Personally I would rather have all of the users of our roads pay for them and the only way to do that is with tolls. That is why just about every state is considering implementing them or expanding their use.
Think about this, CTDOT has estimated that tolls can bring in as much as $800 million per year with 40% of that coming from out-of-state drivers. That is $320 million per year that the residents of our state do not have to pay. Even if that estimate turns out to be high, half that amount ($160 million per year or $4.8 billion over 30 years) will go a long way to rebuilding our highways and transportation system. That would easily fund the reconstruction of I-95 from New Haven to New York; reconstructing I-84 in Hartford; and rebuilding the Route 8/I-84 interchange in Waterbury. All at virtually no cost to Connecticut residents.
” All at virtually no cost to Connecticut residents.”
WRONG. With the exception of children, pretty much every material thing you have has, at one time or another on its way to you, been transported in a truck. The cost of operating the truck is passed on to the party shipping the goods who in turn passes it on the the Consumer via the retail price of the goods… soup to nuts to fuel oil, you name it. And…. don’t think for a minute that the folks in Hartford won’t find a way to mishandle those new funds and be clamoring for even more of your money in the future as they have done so many times in the past.
Think about it. Or go back to the solace of the Sports Page. Your call.