Highway contractors' latest raid on general revenue UPDATE | Arkansas Blog

Friday, February 20, 2015

Highway contractors' latest raid on general revenue UPDATE

Posted By on Fri, Feb 20, 2015 at 7:10 AM

click to enlarge KEEP BUSY: The highway lobby can always find ways to spend money. That doesn't mean it should come from general revenue that supports other programs. - OKROADS
  • OKroads
  • KEEP BUSY: The highway lobby can always find ways to spend money. That doesn't mean it should come from general revenue that supports other programs.

Now Gov. Asa Hutchinson's mettle will be tested.

Gov. Mike Beebe was able to beat back highway contractors' designs on general revenue to maintain their manifest construction destiny in the face of withering fuel tax revenue. But yesterday, a general revenue raid bill passed the House Transportation Committee on a voice vote, despite explicit opposition from Gov. Hutchinson.

Can he stop House passage? Or beat it back in the Senate?

The highway lobby is powerful. Powerful, too, is the somewhat misguided general belief that building highways is a proven economic development tool (beyond the obvious stimulus of paying highway contractors). 

Arkansas maintains too many miles of state highways. It sometimes invests big sums in well-improved routes to nowheresvilles that are home to highway commissioners. The Highway Department can always come up with a billion-dollar construction wish list. But we rarely  take a hard look at the whys and wherefors.

Sure. Everyone wants a four-lane super highway to the Stop n Shop. But do we really need to pave the entire state?

Take the major interstate routes through Arkansas. Undoubtedly industrial facilities have been happy to locate near I-40 and I-30 exits. But these routes also cross dozens of miles of farm and forest unencumbered by many people, much less industrial engines. They DO have to be rebuilt over and over because they serve as a bridge for interstate trucks that routinely pound the roads to rubble without paying their fair share of the cost. We should rob school, prison, health, police and other agencies to subsidize that?

The state's needs are far too great to diminish the general revenue pool by a half billion dollars over the years, not even in return for the pittance of money produced by the gas severance tax. That was nominally intended to cover the damage done to county roads by drilling rigs. If the highways need more money (and they already have a huge bond issue backed by general revenue), let's raise the fuel tax, which has declined in value over the years. Or apply the sales tax to gasoline. Anything but stealing it from school children.

UPDATE: The lobbying campaign is gearing up. A news release arrived this afternoon from Arkansas State University said the revenue raid would be "catastrophic" to higher education, which is already looking at flat funding this year.

News release:
Dr. Charles L. Welch, president of the Arkansas State University System, told members of the Board of Trustees at its meeting today that they can expect to see flat state funding for higher education in the next biennium.

“I want to say thank you to Gov. [Asa] Hutchinson and the General Assembly,” Welch said. “His commitment to higher education during the campaign and continuing commitment to maintain stable funding for higher education are appreciated.”

Welch also said he and others in higher education understand the funding challenges of the Arkansas State Highway and Transportation Department and want to support highway maintenance and construction. However, he said, House Bill 1346 would be “catastrophic” for higher education in the long-term because it would reallocate state general revenues.

“We want to find ways to be helpful without adverse effects on the state budget,” Welch said.

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