By Charlie Arlinghaus
Originally Published in the New Hampshire Union Leader
Odd as it may sound, in the next big budget battle the state government could learn a lesson from Washington in how to balance our books. In transportation spending, the state government regularly plans on spending much more than it has available. The state should reverse this practice and turn the highway plan from a wish list back into a plan.
The federal government may make significant cutbacks to the gas taxes it sends back to New Hampshire but who can blame them? Last year, like most years, the Highway Trust Fund took in $35 billion of revenue but authorized spending of $50 billion. That tells you just about all you need to know about how Washington works.
Transportation Committee Chairman John Mica has broken with tradition by planning on spending only what the fund collects in user fees (largely gas taxes) to balance this one corner of the federal budget. It’s a novel idea in Washington but one that we ought to import into New Hampshire.
New Hampshire currently plans its transportation spending under the old Washington model. Every two years, we authorize a new “Ten-Year Transportation Plan.” In this process, we have a long term plan for the infrastructure projects we can fund.
The difficulty with the so-called plan is that it is and has generally been a fiction. Over the years, the Ten Year Plan has morphed from an actual plan into a public relations document that bears little or no relation to reality. We know going into the plan that under current scenarios we have only so-much capacity. Yet project after project is added to the list to make people feel better even without any hope of paying for it.
It’s a game politicians play. They run around the state holding meetings and making people feel good. They pat selectmen and chambers of commerce on the back and say “we’ve added this important project to the Ten Year Plan.” Everybody feels good. We’re in the plan. He’s looking out for us. But back in Concord they snicker because it’s all a game.
There’s no money. The plan isn’t a real plan. Just a few years ago, the projects had swelled so much that it would have taken 30 years to fund the ten year plan. A former commissioner, Charles O’Leary, was brought in as interim commissioner to dish out the pain. He ruthlessly pared down the list so there were “only” 17 years of projects in the Ten Year Plan.
The Orwellian doublespeak part of the whole process is when people who want to raise user fees talk of a deficit in the plan as if simply planning on spending money you don’t have is a deficit. Because of the way the plan is developed, all we really know is that the wish list costs more than we have.
The problem is the process itself. The starting point should be available revenue under current budget scenarios (which includes the federal government sending $50 million less if they actually stop spending money they don’t have in this one tiny area of federal spending).
Highway spending in New Hampshire is not funded by general taxation. Our highway spending is supported entirely by user fees like the gas tax and turnpike tolls. So, if we’re developing a real plan, let’s start by figuring out how much money those fees will raise over the next ten years.
The second step is to figure out what those specific revenues will support and what they won’t support. The advantage is that we can figure out what gets left out and whether or not we can live with that. It helps put any proposal for new projects or new revenues in context.
As part of that process, we’ll have to make distinctions between new features and maintaining the current features we have. Our current roads require regular repaving so they don’t disintegrate. We have a red list of bridges in need of repair. Setting aside the money for prevention and maintenance should probably take priority over some of the more glamorous projects.
I love open road tolling where I can fly through with an EZ Pass and not be bothered to stop. However, the very large expense of such a new feature comes at the expense of fixing a lot of decrepit bridges. Is my convenience more important than maintaining our current infrastructure?
When the plan matches the revenue, we can evaluate proposals to raise or cut revenues more clearly. This is what we can fund with current revenue. He wants a toll increase to do these four things. That is a much more strategic evaluation than saying we just need some extra so I can tell everyone yes and put them on the wish list.
Charles M. Arlinghaus is president of the Josiah Bartlett Center for Public Policy, a free market think tank based in Concord, New Hampshire.