Unwilling to tax voters for the highways they use, Louisiana lawmakers found a new pot of money to finance $700 million of road projects.
House Bill 578, which passed both chambers this week, redirects money Louisiana receives annually for economic damages from the Deepwater Horizon oil spill litigation settlement to back bonds for fund transportation projects across the state.
The bill, sponsored by Rep. Tanner Magee, R-Houma, would direct $53.3 million a year between fiscal 2022 and 2034 to the Transportation Trust Fund, and authorizes the State Bond Commission to securitize the annual payments with bonds to finance 10 specific transportation projects. All have been planned for a long time, but were unfunded.
The measure passed the Senate unanimously on Monday, while the House approved it on a vote of 92-10 Tuesday. On Wednesday, the bill was sent to Gov. John Bel Edwards, whose office said that he is considering signing the legislation.
Magee said he sponsored the bill because the state’s infrastructure is in dire shape with roads, bridges and highways that are crumbling, and it would fund projects “without raising or even using a single tax dollar.”
“This might be the most impactful legislation I’ll pass in my career,” Magee said after the bill passed. It is a “significant investment in infrastructure and our economy,” he added.
The law prohibits the Department of Transportation and Development from using the new funding on any project that is already earmarked to be financed with grant anticipation revenue vehicle bonds.
The state last year approved its first Garvee program, and authorized the issuance of $600 million to advance the construction of four major projects.
Louisiana receives funds annually for economic and coastal damages caused by the 2010 Deepwater Horizon oil rig explosion that left 11 workers dead and dumped 134 million gallons of oil into the Gulf of Mexico.
Lawmakers initially ordered funds collected for economic damages to be spent annually on specific budget items, sending $25 million into the Budget Stabilization Fund, $24 million into the Medicaid Trust Fund, and $5.3 million into the Health Trust Fund.
Under HB 578, only $1 million would be deposited into the Budget Stabilization Fund a year between 2022 and 2034, while the remaining amount would be redirected to the new transportation fund if Edwards signs the bill into law.
Early in this year’s session, HB 542 had been proposed to increase the state’s vehicle fuel tax and to institute new registration fees on electric and hybrid vehicles to raise about $305 million for transportation funding. The bill died in committee. The state’s gas tax hasn’t been increased since the mid-1980s. It is the final week of the session.
In 2016, Alabama
