Texas Department of Transportation updates commission on $70B plan
One would think that Texans love to drive. Well, maybe more of a love/hate relationship depending on if all of the traffic lights are in sync to your advantage, no one tailgates or cuts you off and you make it to your destination in record-breaking time. There are so many of us on the roadways at any given time of the day so it would make sense that we would want to keep our route as safe and well-maintained as possible. And that means paying our share to keep Texas roads updated, safe and in good condition.
On Nov. 4, 2014, Texas voters approved the ballot measure known as Proposition 1, authorizing a constitutional amendment for transportation funding for the Texas Department of Transportation (TxDOT). Under the amendment, a portion of oil and gas tax revenues that typically go into the Economic Stabilization Fund was deposited into the State Highway Fund. The amendment did not create any new taxes or fees. On Nov. 3, 2015, Texas voters approved Proposition 7, a constitutional amendment to dedicate portions of revenue from the state’s general sales and use tax, as well as from the motor vehicle sales and rental tax to the State Highway Fund for non-tolled projects.
During the 84th Legislative Session, Texas lawmakers passed House Bill 20, which requires changes be made to several of the planning and programming processes that the Commission, TxDOT, and planning organizations use to prioritize and finance transportation projects. Included in the bill was a requirement to measure the performance, planning, progress and funding of projects. TxDOT also had to develop a ten-year funding use plan.
This week, Texas Department of Transportation Commissioners were updated by project planning and development director Lauren Garduño on a $70 billion funding plan called the Unified Transportation Program (UTP). The plan covers 10 years of construction projects. Of the $70 billion, $50 billion of it was allocated by a funding formula that was distributed around the state and to TxDOT’s 25 districts that oversee the construction and maintenance of state highways. The UTP guides the state’s transportation project development and authorizes projects for construction, development, and planning activities and includes projects involving highways, public transportation, aviation, state and coastal waterways, and rail.
The remaining $20 billion is allocated over the next 10 years at the discretion of TxDOT and its commissioners.
“We need to be a better steward of the taxpayers dollars,” said Texas Transportation Commissioner Jeff Austin III, during the update. “If we are looking to that (taxpayer dollars) to pay down some debt, that’s a good thing and I think it makes good public policy headlines. But, the reality from a financier’s perspective is that your paying off debt at 3.17 percent, inflation is starting to go up and rates are starting to go up. Over time we would be paying by deflated dollars . We’re going to get a better return on investment by putting them into the top 100 road projects. Working on the bigger projects in fewer years will show how we are saving money.”
But, some of these funds might need to take a detour based on decisions made during the 85th Legislative Session. J. Bruce Bugg, Jr. a Commissioner of the Texas Transportation Commission questioned what measures would be taken if funds were no longer available. Due to an almost $5 billion shortfall in the state budget, Texas lawmakers are seeking areas to potentially cut to make up the difference. There has been speculation that the money could come from TxDOT.
The Legislature has made no decision on how they will make up the difference, so for now, TxDOT will put down the yield sign and continue with plans that have received a green light. Some of the UTP’s $20 billion would be used for the Texas Clear Lanes, a project headed up by Bugg to provide congestion relief in major cities such as Austin, Dallas, Fort Worth, Houston and San Antonio. According to Texas A&M’s Texas Transportation Institute (TTI), the number of registered vehicles in Texas has risen 172 percent in the past four decades. According to the 2015 Urban Mobility Scorecard in five of Texas’ largest metropolitan areas, drivers are losing about 52 hours and $1,200 annually due to traffic congestion — much higher than the national average.
“Mobility not only benefits individual drivers but also the Texas economy as goods and services move safely and efficiently across our state,” said Bugg. “As our state’s population grows, the 12,000 men and women of TxDOT will continue to collaborate with state and local leaders to find feasible solutions for funding specific projects that TxDOT will execute upon expeditiously to keep people and freight moving throughout our state.”
If approved by the Commission in March, the updated UTP will dedicate an additional $2.5 billion (of Category 12 funding Texas Clear Lanes initiative) for 19 new projects (over the next four years) aimed at relieving congestion in the major metro areas above what is already in the UTP. A complete list of UTP projects can be viewed here.
On March 14, TxDOT will also host a public hearing in Austin on the allocation of Unified Transportation Plan funds.
Strategic Partnerships, Inc. offers customized research services for companies interested in upcoming public sector contracting opportunities. Contact SPI to learn more about upcoming opportunity research services.