Texas transportation commissioner: fix transportation with taxes, tolls, and flexibility

Says system needs more funding

Steve Hawley, Apr 30, 09.

Texas Transportation Commissioner Ned Holmes, in an interview Monday and US Senate testimony Tuesday, said that the nation must fix its transportation infrastructure through a combination of higher taxes, tolls, and flexible spending, according to the Dallas Morning News.

On Monday, Holmes stated, “First of all, I think there needs to be more funding, period. This is not just a big state, high-growth state problem. We feel it more acutely than some others because we are a high-growth state, but everyone I talk to around the country has similar problems.”

He continued, “We need a gas tax increase, but I don’t think we are going to get one in Texas, or nationally.” He also said that transportation needs a variety of funding, including toll revenues: “Once we start restricting the funding sources, it becomes more and more difficult to find enough funds.”

According to Holmes, transportation funding needs to be more flexible as well, and he thinks that highway funds should also be spent on passenger and freight rail projects. The article states, “Sometimes, [Holmes] says, a rail line is a much better fix than a highway, but old-style rules that divide the funds up into program silos don’t help.”

“The states need to have more flexibility,” Holmes said, “and the rules should be changed so that they can move money between some of the silo-ed uses that we have more money and more flexibility.” He continued, “The federal process is restrictive, and narrowly focused in a way that requires us to fund projects by category of available funds, rather than by assessing our needs as to what would be most appropriate. ... We ought to be blind as to mode.”

On Tuesday, Sen. Kay Bailey Hutchison of Texas proposed a bill that would allow states to opt out of the federal highway funding system and keep all gasoline taxes within state borders. According to the Federal Highway Administration, Texas is a “donor” state, receiving 96 cents for every dollar of gas tax it sends to Washington, while other “donee” states receive up to $4 for every dollar sent to the federal government.

Holmes testified, “I don’t want to fight the donor-donee fight. I’d rather move the debate to another level, and find a solution that does not exclude any state. If all we are doing is keeping the funding the same and pulling it from one state and giving it to another, then that is a pretty tough game to play. I would rather spend the time trying to find a way to increase the funding.”