DALLAS — Voters in Maryland will decide next month whether to put state transportation funds in a constitutional lockbox that would prohibit the diversion of dedicated revenues to non-transportation purposes.
Question 1 on the Nov. 4 ballot would amend the constitution to ban transfers from the state's $4.6 billion transportation trust fund to the general fund or other non-transportation funds unless the governor declares a fiscal emergency. The transfer legislation must then pass through the General Assembly with a 60% majority in each chamber. That would require approval by 85 of 141 Maryland House members and 29 of the 47 state senators.
The amendment was put on the November ballot in April 2013 by votes of 108-30 in the House and 40-7 in the Senate.
Supporters of the proposed Maryland amendment said it will stabilize funding for long-term transportation projects and assure motorists that revenue from the state gasoline tax and other road fees are spent on transportation needs.
The Maryland Rural Counties Coalition said that transfers from the transportation fund to balance the state budget and cover reoccurring deficits have cost local governments more than $1 billion over the last decade in lost state highway user revenues.
"While lawmakers rightfully point out that most of the funding 'borrowed' from the state's Transportation Trust Fund over the years was eventually repaid, the deployment of dedicated transportation funding for other uses nevertheless detracted from the state's ability to address infrastructure challenges," said coalition president Mike McCay.
Mahlon Anderson, director of government relations at AAA Mid-Atlantic, said there is currently no constitutional protection for the transportation trust fund.
"This would put a high bar in place and we think it will be effective," Anderson said. "It's not easy to get to a three-fifths vote on any issue where the voters are likely to be strongly opposed, and governors would not want to declare a fiscal emergency lightly for fear of the reaction from bond houses."
Maryland Department of Transportation's $1.8 billion of outstanding consolidated transportation bonds are rated Aa1 by Moody's Investors Service, AA-plus by Fitch, and Triple-A by Standard & Poor's. The state expects to issue $3.7 billion of revenue bonds through 2019 to finance a portion of its six-year, $15.6 billion transportation plan.
Donald C. Fry, president of the Greater Baltimore Committee and a long-term proponent of the lockbox amendment, said shielding the trust fund from budget raiders will ensure the state can pay for large transportation projects that take many years to complete.
Every sector of the state is dealing with transportation problems ranging from traffic congestion to a lack of access to public transit, Fry said.
"Transportation projects do require long-term planning and are usually paid for over an extended period of time," Fry said. "So you want to have a solid, sustainable amount of money in the trust fund."
Gubernatorial candidates Democrat Lt. Gov. Anthony Brown and Republican Larry Hogan support the lockbox amendment.
However, some lawmakers said they were skeptical of the amendment's ability to prevent trust fund transfers.
Rep. Andrew Serafini, R-Hagerstown, said the measure does not present a credible deterrent to future fund transfers.
The current Democratic majority in the General Assembly is large enough to pass fund transfer legislation without Republican support, he said, adding, "It's not a lockbox."
Rep. Herb McMillan, R-Anne Arundel County, said the amendment's three-fifths threshold "has as much strength as a paper bag."
The Maryland measure is similar to constitutional protections already in place in 28 states, including Arizona, California, Massachusetts, New Jersey, Ohio, and Texas. A transportation fund lockbox amendment also is going to Wisconsin voters in November.