DALLAS – The Texas Department of Transportation needs $4 billion from the current session of the state legislature to keep up with infrastructure needs in the rapidly growing state, officials said.
In a report to the legislature, TxDOT noted that it expects to exhaust its $3 billion Proposition 12 general obligation bond authorization by the next fiscal year starting Sept. 1. Those bonds were authorized in the 2011 session after winning voter approval.
To continue adding to the state’s highway and bridge system in the 2014-15 fiscal years, the agency is seeking another $3 billion to ease congestion and $1 billion for maintenance, TxDOT executive director Phil Wilson told planners in Fort Worth on Thursday.
TxDOT, which has a $10 billion annual budget, relies on a 20-cents-a-gallon fuel tax that hasn’t been raised since 1991. State officials say they’ll soon run out of money for any construction or expansion without changes.
In Texas, construction inflation has increased 62% since 2002, according to TxDOT’s report to the legislature. The state motor fuels tax rate has not been raised since 1991. Federal fuel tax rates have not been raised since 1993.
“The bottom line is that while motor fuel tax revenue has generally risen over the years as more people move to and drive in Texas, highway construction costs have also risen substantially to the point that motor fuel tax revenue in FY 2012 bought less than it did in FY 1993,” the report said.
The Texas Transportation Commission that supervises TxDOT has been exploring the idea of allowing state funds to be used to make loans or to provide credit enhancement for transportation projects.
“This could allow transportation entities to improve their credit ratings or access additional financing for needed projects,” the report said. “This would be especially helpful to startup toll authorities such as Regional Mobility Authorities or tolling entities that have fully leveraged their existing system revenues.”
TxDOT is also considering rededicating sales tax revenue on vehicle purchases to TxDOT or adding $50 to the annual vehicle registration fee. Other proposals include ending diversions from the gas tax revenue and taking $1 billion from the state “rainy day fund” to create a highway infrastructure bank.
Wilson said he hoped the Legislature would continue to approve public-private partnerships, such as the southern 41 miles of the Texas 130 tollway that opened Oct. 24.
Those efforts, known as comprehensive development agreements, typically feature managed toll lanes and allow for expedited project timelines.
Another issue the legislature should consider when making funding decisions is damage to roads from heavy trucks operating in the booming Eagle Ford Shale and Barnett Shale oil and gas-producing regions of the state. Until oil and gas producers are able to build pipelines, most transportation from the field is by truck.