With Wisconsin’s State Senate flipping back to Republican control, Scott Walker is now has a clear path to implement his agenda. Walker has stated his priority is growing the economy and growing jobs. That is going to require balancing needs versus wants and prioritizing state spending to maximize the return on investment for Wisconsin. That is why Walker’s soon to be announced infrastructure plan is confusing – WISDOT does not perform a return on investment analysis for any of its projects. Projects are scored based on a small number economically relevant criteria and reviewed by the legislature, but there is no minimal threshold for what constitutes a worthwhile project other than how much money is available in the budget.
By proposing to raise the gas tax and by using money from general purpose revenue to expand highways, Walker is taking more money out the the private sector. Federal highway studies show that the net social return of investment in highways has declined dramatically since the 1950‘s, and is flirting with dropping below the return of leaving the money in the private sector. That means there are a good number of highways out there that are a net drag on the economy, and many of those are state highways. Wisconsin’s lax economic review of the ROI of its highways may be hiding the existence of wasteful projects. WISDOT’s review process needs to be reformed and expanded.
Not only should proposed projects be reviewed more fully and a threshold be created in statute, but the state should review the economic performance of existing highways and relinquish under performing highways to local control. Our economic future depends on it, and our Governor’s stated priorities support it. But will he do it?
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