4 Nov 2009, 5:23pm
Gas taxes Roads Toll roads


The genesis of the toll road problem

One issue that many toll road opponents can’t seem to wrap their heads around is the underlying reason why toll roads are being pushed.  It’s not some get-rich scheme by Rick Perry or TxDOT.  The problem is the dearth of funding that has plagued transportation for more than a decade now.  And it’s not just Texas—many other states, as well as the federal government, are having the same problem.

The core problem that has lead us to the current mess is the gas tax.  Here in Texas, we pay 20 cents per gallon in state motor fuel taxes each time we buy gas or diesel.  That amount has been fixed since 1991 and the Legislature, in a self-serving and shortsighted effort to placate an anti-tax constituency, has not shown any interest in increasing it.  If you stayed awake during your high school economics class, then you probably remember learning about the concept of inflation.  What 20 cents could purchase in 1991 is considerably more than it can purchase in 2009 because the value of the dollar has decreased over those years.  In fact, based purely on the Consumer Price Index, something that cost 20 cents in 1991 costs 32 cents today, a 60% increase!  And highway construction costs have escalated at rates substantially higher than the CPI.  So while TxDOT has to pay 2009 prices for the work it needs done, it’s having to do so with revenue fixed at 1991 rates.  It would be like you or me having to pay today’s bills while earning what our job paid in 1991.

On top of that, better fuel economy since 1991 has meant that most drivers pay less tax per mile now than they did in 1991.  So while it is true that there are more vehicles on the road traveling more miles than in 1991, the state has to build and maintain more roads to support those increases while motorists are paying less per mile of use.  The cost of building and maintaining each mile of road has gone up; what drivers pay for each mile of road has gone down—I think it’s pretty simple to see the Catch-22 there.  And with the recent hubbub about making substantial improvements to MPG, this is a problem that will only get worse.

As if that weren’t bad enough, not all that we pay in gas taxes even goes to pay for our roads and other transportation systems.  The state’s constitution, since 1946, has directed that 25% of motor fuel tax revenues go to public education.  After collection costs, the rest goes into the state’s highway fund, where the Legislature has taken 10% or more for as long as I can remember to pay for ancillary things including DPS, TxDOT employee benefits, and matching funds for Medicare/Medicaid ambulance rides, all items that should be paid for from other pots of money, including the General Fund.

To summarize, roads and transportation are getting shortchanged by our elected officials.  Since the Legislature has refused to fix the gas tax problem (and actually adds to it every biennium), and the governor has threatened to veto any tax increases anyway, TxDOT has been left to find other ways to pay for big-ticket projects.  So in 2003, at the direction of the Texas Transportation Commission, the executive committee appointed by the governor that oversees TxDOT, all expressway projects in the state were studied for toll viability and converted to toll projects if they were deemed to be feasible.  In a sense, TxDOT is simply doing what they’ve been told to do by their bosses, although some would argue that they’re doing it too well.  Regardless, they’re playing the hand they’ve been dealt.

It’s important to understand that tolls themselves are not intended to be a congestion-relief tool like congestion pricing is.  Rather, it’s the improvements paid for by tolls that will relieve congestion.

Hopefully now you see why tolls are being proposed and implemented to the extent that they are.  Now whether tolls are the right answer, and how to fix things without tolls, leads us to a huge chicken-and-egg question that I’ll hash out in my next post.


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