$2.3 billion for highways
On Thursday night Pennsylvania lawmakers passed a legislative bill that allows for “billions in new taxes and spending for roads, bridges and mass transit” in the state. House Bill 1060, which is an “act amending Titles 74 (Transportation) and 75 (Vehicles) of the Pennsylvania Consolidated Statutes,” according to the Pennsylvania General Assembly. The bill passed with 113-85 votes. Gasoline will be taxed and motorist fees will rise over the next five years, which will add up to at least $2.3 billion in additional funding. As previously reported, Gov. Tom Corbett said that he “perceived an urgent need to address transportation infrastructure” after he took office. “The passage of the vote showed leadership,” he said. “The longer we wait, the longer we put all of them at risk.” The tax increase on gas at the wholesale level “could boost prices at the pump by a quarter or more” by the time it is “fully implemented” in five years. Corbett also stated there's “no way” to predict how much of the increase would effect consumers. House Bill 1060 also allows for increased fees and fines collected by the Pennsylvania Department of Transportation (PennDOT). Prevailing wage rules will also be changed, which will save local governments “millions of dollars” a year. This means the minimum pay requirements for projects “worth less than $100,000” will be waived. Currently the limit is $25,000. PennDOT Secretary Barry J. Schoch also provided the following facts about the bill: • The financing phases in over a five-year period. It is misleading to ignore this fact when gauging the plan's impact. The plan does not include an immediate increase of 28 cents per gallon, as has been reported. Such an estimate is based on the wholesale price of fuel in 2018. It is not possible to predict the price per gallon five years from now. • The plan eliminates the 12 cent-a-gallon liquid fuels tax. Under this proposal, all gas tax revenues are generated at the wholesale level. • Competitive situations and the cost of crude oil have the largest impact on the price per gallon. Even with this revenue enhancement in place, the average driver would only pay about $2.50 more a week in the fifth year of the plan, less than the cost of one gallon of gas. In return, the commonwealth will receive $2.3 to $2.4 billion in transportation improvements. • Comparison of gas tax rates with other states is not a fair assessment since many states use other funding sources to pay for highways and bridges, so they keep their rates artificially low. In Pennsylvania, fuel taxes are used only for highway and bridge-related purposes and state police patrol functions. Income and sales taxes are not used to pay for state-maintained highways and bridges in Pennsylvania. The fuel taxes in Pennsylvania amount to a true users' fee, based on the amount of gasoline consumed and use of the highway and bridge system. • Pennsylvania's vehicle registration fees are among the lowest in the nation, with 39 states charging more. Also, 31 states charge more for the cost of a driver's license. The bill is anticipated to be signed by Corbett next week. What comes next Rich Kirkpatrick, Acting Press Secretary for PennDOT, reflected what Corbett said that the “action by the House Representatives made it a landmark day for Pennsylvania.” “The positive votes in both the House and Senate demonstrate the elected officials are very serious about keeping the residents safe and the economy strong,” he said. “The lawmakers who voted for it, said yes to the state's future. Now it's up to PennDOT to deliver on those promises. We absolutely will. We will work to enact the projects these funds will help with.” Kirkpatrick said the bill will help enhance safety mobility and enhance the economic activity of the state. “When you make an investment in transportation you're initially providing good paying jobs to people to build or repair infrastructure,” he stated. “This will help to produce 50,000 good paying jobs a year in Pennsylvania. Once improvements are made that will help commerce, it will attract businesses to an area, which will create more jobs. It's a cascading effect that comes into play when you make an investment in transportation.” Kirkpatrick added that now the ball is “really moving forward.” “After 16 years of not being able to make it, we are now poised to take care of the bridge situation that triggered restrictions all over the state and to prevent pavements from deteriorating,” he explained. “If making the investment can make the roads as smooth as possible, it will save people lots of dollars.” He also explained that there are “all sorts of benefits” for people who are interested in saving money on their vehicle wear and tear. “This is important at a time when the economy is struggling,” said Kirkpatrick. “It will definitely provide a boost.” Kirkpatrick said that it's “gratifying for us as the agency responsible” for getting the transportation system additional resources to “deliver for the people of Pennsylvania.” “We'll tackle what the ongoing issue is and keep our bridges in the best shape possible,” he stated. He noted that Pennsylvania has 25,000 state maintained bridges, which is the third largest in the nation. “It's a huge bridge inventory and they're expensive to maintain,” Kirkpatrick said. “Typically a bridge project will cost between $1 and $2 million and if you multiply that by 25,000 that's a huge investment to keep the infrastructures sound. They wear out over time. It's not something that improves without action.” He added that anyone with a house or a car knows that over time things wear out and need to be maintained or replaced. “The bill allows us to do that,” he said. “It's very gratifying that after many years of trying to make this kind of investment, Pennsylvania elected officials decided yes, the case was made and PennDOT can move forward and we will.” Kirkpatrick stated that one thing to keep in mind is that the 28 cents a gallon increase over the five years “is only speculation” at this point. “The figure is based on what price fuel will be four years from now,” he said. “It's impossible to say exactly what the impact will be.” Kirkpatrick added that it's been 16 years since PennDOT has been asked to pay more. He said we rely on many services such as cable TV, Internet, etc. and that those “have had increases pretty regularly.” “PennDOT hasn't increased rates in awhile,” he said. “Transportation is an important service and one of the most important. You rely on it to take you to your job, to school, to church, medical appoints, etc. It's rare that PennDOT comes to people and says we need more.” He also said the point is that maintaining and improvements are needed and that they “have to have more resources” to get it done. “We're asking more, but it's being phased,” Kirkpatrick said. “We're trying to keep it as reasonable as possible.” He said that Pennsylvania has 4,500 structurally deficient bridges, which means they have reached a point that they need attention. He also said there are 9,000 miles of pavement that needs improvement. “Having the resources [from the bill] ensures that we can stay ahead of those bridge needs,” Kirkpatrick said. “The benefits are an added investment that will be tremendous. In the long run it will save money on vehicle wear and tear, too.” He said PennDOT's rough estimate “even in year five” that they will be asking, will be, on average, about $2.50 a week per driver by year five. “The positives outweigh the sting of having to pay more,” Kirkpatrick stated. “There's value in having a road and bridge system safe, smooth and available for use. It's difficult to pay more. No one wants to; we understand that. But the reality is that the cost of maintaining a system as big as Pennsylvania's is a lot.” He said that with 39,000 miles of roadway, Pennsylvania is the 5th largest in the nation. “Again it's been 16 years since we've asked people to pay more,” Kirkpatrick stated. “We're at a point where we just had to do it, to move the system forward. There are values in paying more. “It's a difficult issue. At a glance people see they have to pay more, but there are costs that have to be met. We had to make a difficult decision. The legislature and government had to make a difficult decision. “Again there's value having a better maintained transportation system of roads and bridges.” Kirkpatrick added that fees will be “indexed to inflation” and it's estimate that by July of 2015, the driver's license fee will increase by $2 and the vehicle registration feel will increase by $4. Local support • In a release from local officials, Reps. Sandra Major (R-Susquehanna/Wayne/Wyoming) and Mike Peifer (R-Monroe/Pike/Wayne) and Sen. Lisa Baker (R-Luzerne/Monroe/Pike/Susquehanna/Wayne/Wyoming) voted this week to invest more money in the state's transportation infrastructure. “Pennsylvania relies on fuel and use taxes to fund our highway maintenance and construction, which means those who use the roads and bridges are responsible for their costs,” the legislators explained. “We have listened to the thousands of complaints we've heard about the roads not being properly maintained, about the additional expenses businesses are incurring because of detours around closed and weight-restricted bridges, and about the repair costs associated with substandard road conditions.” “The package represents a considerable investment in the future, for economic progress and for public safety, and clears the way for action on more of our transportation priorities in this area over the coming years,” Baker said. “While I understand and appreciate that many people do not want to pay any more in taxes and fees, our transportation needs are too large and too serious to delay action any longer. The variety of funding sources utilized should work to reduce the eventual impact on the price of gas at the pump.” “An efficient transportation system is vital to the health of our state and local economies,” Major said. “This investment will provide increased funding to our local governments for road and bridge projects and dedicated funding needed for dirt and gravel roads. However, at its core, the primary reason for addressing our deteriorating transportation system is to better ensure the safety of our motoring public.” “The fact is, we did not create this problem, but we cannot ignore it any longer. Our roads and bridges are in terrible condition, and without an additional influx of funds, the problem will only get worse,” Peifer said. “Doing nothing was not an option. There are a lot of good things in this legislation, and I feel confident we will see a solid return on this investment in ourselves.” • The Pennsylvania Farm Bureau also shared their support of the bill. The following is a release urging Corbett to sign the bill: Just two days after criticizing members of Pennsylvania's General Assembly for failing to take legislative action to fund the Commonwealth's transportation system, Pennsylvania Farm Bureau (PFB) is praising lawmakers for finally approving a plan to address the issue. “Pennsylvania's deteriorating road and bridge system has negatively impacted farmers, businesses and the public. We are pleased that action has been taken in the state House and Senate to help alleviate the problem,” said PFB President Carl T. Shaffer. “We now urge Governor Corbett to sign the legislation so critical repair projects can get underway.” The Farm Bureau noted that weight restrictions imposed on bridges earlier this year placed a burden on farmers. “During the fall harvest, farmers were forced to take longer routes to deliver corn and soybeans, due to weight restrictions placed on aging bridges. This resulted in higher fuel costs for farmers, reducing profit margins on those crops,” added Shaffer. “Some milk haulers also had to find alternative routes to deliver milk from the farm to the processing facility, and the added fuel costs were passed on to dairy farmers.” The Pennsylvania Farm Bureau is the state's largest farm organization with a volunteer membership of more than 58,300 farm and rural families, representing farms of every size and commodity across Pennsylvania.