Via Citizen Tribune
The road trip for Gov. Bill Haslam’s proposed IMPROVE Act made a stop in Morristown on Wednesday.
Tennessee Department of Transportation Commissioner John Schroer presented his arguments for the “Improving Manufacturing and Public Roads and Opportunities for a Vibrant Economy” Act in a noon meeting held at the Morristown Area Chamber of Commerce.
The effort to increase revenue to fund ongoing and new bridge and roads projects across the state would cost the average motorist $4 per month in increased taxes.
“This is the governor’s initiative that we’ve been talking to him for about five years. Those of you who are involved with building roads in local communities know that it’s getting harder and harder to do,” Schroer said. “We don’t have the revenue we need to fix the roads we have.”
Schroer said this would be the state’s opportunity find new revenue for roads for five or six years, since 2018 is a gubernatorial election year, followed by a first-term governor who will more than likely run on jobs and education, like Haslam.
He spoke to a roomful of local and regional stakeholders, including members of the Lakeway Area Metropolitan Transportation Planning Organization.
According to Schroer, the plan was initiated by the state comptroller’s report to the legislature three years ago.
“The way we are being funded is not sustainable,” Schroer said.
He said the increasing costs and inflation are to blame, along with the fact that the gas taxes have not been touched since 1989. TDOT’s revenue in 1989 of $800 million has doubled to $1.8 million revenue today; however it pales in comparison to the state budget in 1989 of $7 billion that has increased to around $37 billion today.
“While our budget has increased twice the amount; the state’s has increased five times in the same time period. We are being funded by a flat, non-changing gas tax that has nothing to do with the cost of gasoline,” Schroer said.
According to information shared during the meeting the gas tax rate has not changed in nearly 30 years; meanwhile the cost of building and maintaining the thousands of miles of state roadway has doubled.
The plan would increase the state gasoline tax by 7 cents per gallon and the state diesel tax by 12 cents per gallon, bringing them closer to the national average. In addition to the motor fuel tax, vehicle registrations would increase by $5, $10 or $20 through a tiered system, based on the vehicle type and use. A new annual fee of $100 is proposed for electric vehicles. Rates on liquefied gas, compressed natural gas and liquefied natural gas are proposed to increase by 15 cents per gallon. A three percent fee, dedicated to transportation would be added to rental cars. A newly proposed open container law would allow millions of dollars in federal funding to be used for highway construction.
The increased revenue of $279 million would fund 962 projects in all 95 counties, providing improvements to interstate, state routes, bridges and economic corridors – balanced across the state, split between rural and urban communities, industrial access and transit programs.
“What the governor all along has said is that people wanted this to be tax neutral, so there are corresponding tax cuts in the plan,” Schroer said.
The plan includes $270 million in tax cuts; they are not all paid by the average consumer, a fact that accounts for the $4 month per motorist increase.
The plan includes cuts in business taxes of $113 million. Tennessee has the fourth highest business tax in the country; leading to recent decisions by several manufacturers to locate elsewhere and costing 4,000 Tennessee jobs, Schroer said — “These tax cuts will have a huge impact on creating jobs across the state,” he said.
Other cuts in the plan include a one-half percent cut on grocery taxes ($55 million) and a 1.5 percent cut to the Halls tax (income tax on dividends) in 2017 and 2018 ($102 million).
“He’s already made $270 million in tax cuts already; this would result in $540 million in tax cuts made during his administration,” Schroer said.
The plan encompasses 12-15 years of projects.
Hamblen County would receive increased funding of $670,000 annually; Jefferson County: $700,000 annually.
Local bridge projects across the state included in the plan number over 500, with proposed funds of $392,166,969.
“They have a huge impact on your communities,” Schroer said. “We want to make sure those bridges are brought up to current standards. Right now, the state is not allowed to work on local bridges (although the state inspects them) as part of the Fast Act, we will be allowed to spend this money. We have a rating on every single bridge in Tennessee. Only the IMPROVE act has this provision.”
In the plan, 24 projects ($245 million in funds) have been identified in Hamblen and Jefferson counties.
“11E is a huge road that goes through all your areas and it needs to be done,” Schroer said.
Three projects along the highway are in some phase of TDOT development, totaling $50 million.
In Hamblen County, one of the projects is along East Andrew Johnson Highway, from US 25E to E Morris Boulevard, with right-of-way appraisals under way, covering 150 tracts of land. A new phase along Andrew Johnson Highway (Steadman Road to I-81) will require $33 million in funding.
In Jefferson County, a new bridge over the French Broad River will $60 million in funding.
“We have right of way scheduled to start later this year,” Schroer said.
Also in Jefferson County, a project along US 411, near Bush Beans will $35 million in funding. A new start project along I-81, from I-40 to SR 341, will require $50 million.
If the IMPROVE act is passed, the three projects on 11E can be completed in six years.
“If we don’t get the new money, that time schedule will go out the window,” Schroer said. “All of these projects on the list, we know we need to get them done, it’s just a matter of how quickly we can get them done.
“Right now, I’ve got about $500 million a year in federal funds (with state funds attached) to address new projects. With this new funding, I would have an additional $300 million a year. That is where the expedited processes would come in.”
Over the next 10 years, almost $10 billion in funds would be required to complete all the projects in Tennessee.
“The plan is facing challenges in the legislature — “It’s not an easy sell,” Schroer said.
Schroer served on a school board for 13 years; was mayor of Franklin for four years and has served in his current capacity for six years.