The statewide coalition of business interests is the main cog driving the effort to find billions for the state’s long-underfunded transportation system.
Traffic jams on the interstates 25 and 70, along with the poor condition of the state’s roads and bridges, are the products of legislative neglect. This session, legislators have vowed to do something about it.
House Bill 1242 will be heard before the House Transportation and Energy Committee Wednesday afternoon. The deal on the table would ask voters in November to pass a 0.62 percent state sales tax to raise $677 million a year for transportation, including bike paths and transit.
Fix Colorado Roads is heavily invested in finding a solution, but it has some issues with the current proposal and seems to understand its complexity way better than the press.
“HB 17-1242 takes the critical first step in assembling a funding solution for the bonding package,” the organization says in the opening of an analysis.
“… Upon a thorough review of the measure, however, the proposal falls short in several key areas, specifically its failure to provide sufficient, significant and equitable resources to the state system from the new revenue source, failure to include a reasonable level of existing general funds (and instead a depletion of such resources) and failure to identify a list of projects from which the citizens of Colorado will benefit.”
This isn’t light reading for the everyday, ticked-off motorist, but if you follow transportation funding in this state or any, this comprehensive overview from Fix Colorado Roads is just for you:
Initial Observations Upon Review
- State transportation system is a secondary concern of the measure.
o Local metro and multimodal appear primary.
- CDOT bears full brunt of offset revenue reductions.
- CDOT’s portion of the funding — $300 million — is locked/stagnant over the 20-year term.
o Diminishes in value over time.
o No benefit of future growth of sales and use tax.
o CDOT is prevented to keep pace with state growth.
- All future growth of state sales tax is only to local governments and multimodal fund.
- The $205 million net available for CDOT is not sufficient to cover the $3.5 billion bond program.
o $50 million plus additional CDOT resources will be necessary.
o Only $2.5 billion to $3 billion in proceeds possible with $205 to $255 million.
o Need at least $300 million annually for $3.5 billion bond program.
- Interest rate increases continue to diminish value of annual payment.
- Eliminates all existing/planned — about $400 million — in General Fund revenues.
o No restoration of General Fund allocations.
o No replacement formula for the flawed Senate Bill 228.
o Polling consistently demonstrates taxpayers expect the legislature to make transportation a priority by committing some existing General Fund resources to transportation before/at least concurrent to asking for new money.
- A local government TABOR limit for revenue may not be overridden by a state referendum.
o Local governments that have not ”de-Bruced” may be unable to accept funds.
- When distributed to the individual cities and counties, the new revenue may not compensate or offset the loss of the local tax rate capacity, e.g. Colorado Springs.
- Multi-modal funding and opportunities for additional funding are vast and disproportionate:
o Multimodal Transportation Options Fund.
o Local flexibility to use funds on multimodal.
o Multimodal projects allowed to be included in the state’s bonding program.
- Creates a new Type 1 committee to oversee the multimodal fund and doesn’t use the existing Transportation Commission.
- No state project list included in measure
o Projects identified by Commission; potential for free-for-all
o Current CDOT Tier 1 list is diluted with small projects.
o Major corridors are not sufficiently funded under current CDOT Tier 1 list.
o Expands eligible projects beyond STIP to include multimodal, maintenance and “priority list” (undefined) projects.
o If not a list, at a minimum, specific criteria for choosing projects and funding levels should be included.
- Maximum bond repayment of $5 billion is too low; should be at least $5.5 billion.
- No reporting requirements of use of funds for local governments.
o No reporting under current HUTF provisions, however
- No reporting requirement for multimodal transportations options fund
An Overview of the Provisions of House Bill 1242
- Refers ballot measure to the November 2017 ballot.
- Statutory modifications requiring majority legislative vote for referral.
- Authorizes CDOT issuance of up to $3.5 billion in TRANs bonds.
o Maximum repayment of $5 billion.
- Sales tax increase of 0.62 percent.
o Increase existing rate of 2.9 percent to 3.52 percent.
- Represents a 21 percent increase in rate.
o 20-year effective period.
- Years 2018 to 2037: $702 million in gross annual revenue generated (year one).
- $14 billion+ over 20-year period.
- Plus, general growth in sales tax revenue.
- $75 million reduction in FASTER safety fees.
o Fee on small cars would drop from $23 to $9 and from $28 to $11 on larger passenger vehicles.
o All reductions are taken only from state portion of FASTER revenues.
- Net new annual revenue: $627 million in year one, $12.5 billion+ over 20 Years.
- Requires use of $50 million in existing CDOT revenue dedicated to bond repayment.
- Requires any balance owing on annual bond payment to come from other CDOT revenues.
- Eliminates balance of Senate Bill 228 funding to CDOT (FY 17-20).
o Reduction of $400 million+.
- First $300 million to state projects.
o Fixed allocation.
- No growth in sales tax revenue.
- Diminishing value over the term:
o Gross: $300 million or $6 billion over 20 Years.
o Net: $205 million or $4.1 billion over 20 Years.
- FASTER reduction and eliminate Senate Bill 228 funding (20-year average).
o Repeals 10 percent for transit spending requirement.
CDOT portion to be spent as follows:
- First dollars to bond payment.
- Next $50 million of any remaining for newly established Rapid Response Maintenance program.
- Then, any remaining for qualified federal aid transportation projects including multimodal capital projects included in STIP or CDOT priority list.
- Balance of revenue:
o $402 million+/$8 billion+ over 20 years.
- Plus ALL growth in state sales tax revenue.
o 70 percent to local governments (cities and counties).
- $281 million+ annually/$5.6 billion+.
- 50-50 city/county split.
- $140 million+ or $2.8 billion each.
- Existing HUTF local formula used for further allocations to individual counties and cities.
- Funds are fully flexible and can be spent as local governments deem appropriate.
- Repeals 15 percent limit on expenditure on multimodal.
- 30 percent to multimodal transportation options fund.
- $120 million+ annually or $2.4 billion.
- 75 percent of funds to the Transportation Options Account.
- 25 percent of funds to “Pedestrian and Active Transportation Account.
Total Net Percentage Allocations
- 42.7 percent CDOT
- 29.2 percent CDOT actual
- 13.5 percent CDOT reductions.
- CDOT percentage of total revenues will drop as sales tax revenues increase over 20 year period due to fixed $300M allocation.
- 40.1 percent locals.
- 20 percent county.
- 20 percent city.
- 17.2 percent multimodal.
Total percentage growth in allocations over current funding.
- 33 percent for CDOT.
- 100 percent for local governments.
- 1,000 percent for multimodal.
TRANS Bond Project List
- List to come from CDOT STIP (Strategic Transportation Investment Program) and CDOT priority list (undefined)
- Expands the authorized use of TRANS Bonds proceeds beyond STIP projects to also include multimodal projects, maintenance projects and projects on a CDOT priority list.
o CDOT shall provide a project list within 30 days of passage of act for inclusion in voter Blue Book.
Citizen Oversight Committee
- Provides oversight of the expenditure by CDOT of proceeds
- 15 members.
- CDOT chief engineer.
- 11 reside in each of the 11 Transportation Planning Regions
- 3 at-large members.
- 6 appointed by the governor – no more than four from same party.
- 2 each appointed by House speaker, president of the Senate, House minority leader and Senate minority leader.
- Appointees shall include: a professional public finance experience, CPA, licensed attorney, contractor with experience on transportation infrastructure projects, licensed civil engineer, representative or advocate of transit providers, person of disability or represents/advocates for persons with disabilities, advocate for affordable transportation options.
Multimodal Transportation Options Fund
- Under the Division of Transit and Rail Division of CDOT.
- Division is responsible for soliciting, receiving and evaluating applications for transportation options project funding from local governments and transit agencies throughout the state and proposing funding for interregional transportation options projects.
- Establishes definition of “multimodal transportation options.”
- Both public transit infrastructure/operations and infrastructure that is designed for “non-motorized mobility enhancing equipment” (aka bikes).
- “Transportation Options” means transportation infrastructure, operations, and services that are provided by the state, or one or more local governments, regional transportation authorities, or transit agencies and includes:
Bus and rail facilities, transportation services for seniors and persons with disabilities, transportation demand management programs, infrastructure designed for pedestrians and users of non-motorized mobility enhancing equipment., development and implementation of new transportation technology.
Creation of Multimodal Options Fund and Committee
- Governor Appointed
- 11 members: two members from transit agencies, three members representing MPOs or RPO, four members representing local governments, one member who is an advocate for transportation options and the CDOT director.
- Committee Responsibilities: Equitably, efficiently, and effectively allocate the money in the transportation options account of the fund to fund transportation options projects throughout the state.
- Develop a formula for allocating the money among the regions of the state.
- Population, transportation options needs, transportation options performance, and the availability of local matching money must be taken into account.
- Supervise and provide guidance to the division to determine which transportation options projects receive funding and the amount of the funding provided for each project receiving funding.
- Propose programs to provide at least a basic level of transportation options service to low-income Coloradans throughout the state.
- Including free transportation options pass and reduced fare programs
- Annual report by CDOT to the Joint Budget Committee, the Legislative Audit Committee and Transportation Committee regarding use of TRANS proceeds.
- No reporting requirement for Multimodal Transportation Options Fund Committee.
- No reporting requirement for local governments for use of funds.