Coming soon but conveniently after the conclusion of state elections, Scott Walker will announce his plan for state infrastructure spending. While his administration has been tight-lipped about what the plan contains, there are hints of the general direction it will take.
First up, a gas tax increase. How much is still a matter of speculation, but I have been hearing indications that the gas tax may be retroactively re-indexed to inflation as if the repeal of indexing in 2006 had not occurred. Not only is the return of indexing an option, but there may also be plans to dip into general purpose revenue by an amount equal to what would have been added to gas tax revenue if indexing had never been repealed. What it adds up to is a kind of gas tax holiday to be paid for by everyone in the state, not just the folks who like to drive.
These rumors stand in contrast to what the Governor’s Transportation Finance & Policy Commission has recommended, which included a mileage-based fee with a break for low-mileage drivers. It also stands in contrast to what Scott Walker originally campaigned on: Tolls and converting highway funding to user fees. Apparently, this is because it is politically impossible for conservatives to pass anything that looks like a new tax (even though the tax is a user fee).
So what would Walker’s plan have the state invest in? Highways, and about $90 mil in freight rail improvements targeted at taking sand fracking trucks off local roads. Too bad the Governor isn’t paying attention to trends showing that Americans are driving less for reasons beyond the poor economy.
Keep in mind that one the top goals of the state GOP for the 2013-14 session will be cutting taxes. Dipping into General Purpose Revenue for highways and frack sand freight rail means something else will have to be cut in the budget. And did I mention that WISDOT does not perform a net social return on investment analysis on any of their projects? It is hard to evaluate the need for spending between programs if you have no estimation of the relative value to the state…
