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American ShipperIntermodal

Some states turn to gas tax hike

Some states turn to gas tax hike

   As the U.S. government prepares to reauthorize its six-year transportation spending priorities, several states are also reforming transportation policies to grapple with shrinking budgets.

National and state fuel tax receipts used to fund highway maintenance and upgrades continue to decline as people drive less or use more fuel-efficient vehicles.

Massachusetts Gov. Deval Patrick recently filed comprehensive transportation legislation that includes a trial program to evaluate electronic billing of vehicles based on the number of miles traveled and eventual phase out of the fuel tax. In the short term, it would also increase the state fuel tax to pay down debt and roll back proposed toll and transit fare increases.

Patrick wants to raise the fuel tax 19 cents from its current 23.5-cent per gallon level ' unchanged since 1991. Future increases would be tied to inflation. He said he will not support a gas tax increase without other reforms in his plan.

The governor dedicates 1.5 cents of the increase for targeted regional road projects and 3 cents for rail projects outside Boston, 1 cent for innovative financing schemes and the rest for several other priorities.

An inefficient, bloated bureaucracy has left Massachusetts with a backlog of unmet transportation needs, huge debt and a reputation for poor project management highlighted by the Big Dig ' the poster child for public works projects run amok. Patrick has instituted a series of streamlining measures that have saved $83 million during the past two years and wants to coordinate use of federal stimulus dollars, state capital money, bonds for an accelerated bridge program and other reforms to rebuild the surface transport system.

Patrick said his goal is to close an estimated $15 billion to $19 billion funding gap to maintain the existing road, rail and bridge network during the next 20 years.

Cost-saving efforts already undertaken by Patrick include reducing project delivery time at the Massachusetts Highway Authority by 40 percent and eliminating middle management and toll takers at the Turnpike Authority. He has also received backing from the legislature to launch a program to accelerate long-neglected bridge repairs.

   The Highway Authority intends to cut red tape for project development and use more efficient construction techniques to accelerate almost $3 billion in funding during the next eight years to repair 250 to 300 structurally deficient bridges. So far, 30 projects are ready for construction or underway. The accelerated bridge repair plan is financed using $1.1 billion in grant anticipation notes, which borrow against anticipated future federal funding, and $1.9 billion in gas tax bonds to be repaid with existing tax revenues.

Other reforms include abolishing the Turnpike Authority and creating a streamlined bureaucracy with highway, tunnel and bridge responsibilities under one roof, and creating a consolidated executive office of transportation with divisions for highway, rail and transit, aviation and port, and motor vehicle registry.

The Massachusetts Office of Transportation last year also began a comprehensive review of the state's freight and passenger rail system and intends to publish a multimodal and intermodal state freight plan as well as a rail plan. A working group will address rail capacity and operations, rail contribution to economic development, minimizing rail impact on the environment, safety and security, and make policy recommendations.

In a Feb. 20 speech outlining his plan, Patrick noted that unreliable rail service makes it difficult for people to commute to jobs and drives up the cost for local companies to ship goods.

In Oregon, Gov. Ted Kulongoski also is pushing for a vehicle-miles-traveled fee as a substitute for the gasoline and diesel tax. His 2009 budget proposal allocates $10 million to study fuel-tax alternatives.

His 2009 budget also calls for a 2-cent increase in the gas tax to raise $499 million per year for Oregon's transportation system. Additional revenues would come from an increase in registration and title fees. Kulongoski also seeks to address key freight bottlenecks by using $600 million in bond proceeds and create the first multimodal fund supported by discretionary federal dollars for non-highway projects.

Overall, the governor increases the biennial budget for transportation, compared to existing appropriations, by 23 percent to $4.3 billion.

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