Tag: Fiscal Year 2020 budget

House approves budget plan maintaining $100-million boost to transportation

The Missouri House has proposed a $29.2-billion state budget for the fiscal year that begins July 1.  Among other things it maintains Appropriations Committee Chairman Cody Smith’s (R-Carthage) plan to apply $100-million of General Revenue to road and bridge projects.  That would be in addition to the money in the state’s Road and Bridge Fund, which is dedicated to transportation.

House Budget Committee Chairman Cody Smith, R-Carthage (photo; Tim Bommel, Missouri House Communications)

If that proposal becomes law it would be the first time GR dollars have been used for transportation infrastructure.  Smith said the state’s road funding has been falling behind for years, and with other proposals to support it having fallen short – including a gas tax increase that was rejected by voters in November – it’s time to consider unprecedented sources.

He also said his plan is a better option than what Governor Mike Parson (R) proposed, to use bonds to support $350-million for bridge projects, which take years to pay off.

“Going further into debt comes at a high cost.  We already spend, on average, about 24-percent of the road fund on debt service as it is,” said Smith.  “This plan, paying as we go, could save us as much as $100-million over the course of 15 years, and it’s really that simple.”

Democrats say this approach creates uncertainty for the Department of Transportation, which wouldn’t know year-to-year how much money the legislature might decide to give it.

Kansas City representative Greg Razer (D) said the plan also would set a precedent that transportation would compete with other state priorities that are already funded with GR dollars, including education and medical care.

“The day will come when we have our director of transportation, people with disabilities, the presidents and chancellors of our universities all coming and trying to fight over the same pot of money,” said Razer.

Representative Greg Razer, D-Kansas City (photo; Tim Bommel, Missouri House Communications)

Razer and other Democrats said the state should not get away from using only the Road and Bridge Fund to support transportation.

“It’s something that has served us well for nearly a century,” said Razer.

Democrats say $100-million won’t go very far toward meeting the transportation infrastructure needs across the state.  Festus Republican Becky Ruth said a lot of options that have been considered might be short-term solutions.  She said this one would be a good start.

“Right now we have to do something, and that’s what the people of Missouri [have] asked us to do,” said Ruth.

“When our school busses are travelling on roads and crossing bridges and many of those bridges are in poor condition, I want you to stop and think about those children sitting on that school bus.  I want you to stop and think about the families driving in their car down the road.  I want you to stop and think about all of the people that use our highways day in and day out to get to their destinations – to go to work, to return from work – and they want to be able to do that safely,” said Ruth.

Smith said it is his intention to propose the use of General Revenue in future budget years to cover the projects that would’ve been paid for in the governor’s plan.  Each year, then, that would have to be decided upon by the General Assembly.

The 13 budget bills that make up the House’s spending plan now go to the State Senate, which will propose changes to it.  Then the two chambers will attempt to reach a compromise on a budget to be sent to the governor before the constitutional deadline of May 10.

House Budget head unveils road and bridge funding proposal as part of F.Y. ’20 budget

The Missouri House’s Budget Committee Chairman has unveiled his plan for paying for road and bridge work in the state, in place of the plan proposed by Governor Mike Parson (R) in January.

House Budget Committee Chairman Kip Kendrick (photo; Tim Bommel, Missouri House Communications)

Representative Cody Smith’s (R-Carthage) plan is to use a $100-million from the state’s General Revenue Fund to support the Statewide Transportation Improvement Program (STIP), which is the Department of Transportation’s plan for road and bridge improvements for the coming years.

Parson’s plan called for using $351-million in bonds to replace or repair 250 bridges throughout Missouri.  The bonding would have been paid back with about $30-million from the state’s General Revenue fund for 15 years.

Smith said it is important to focus on creating a plan that would funds transportation infrastructure but not put the state further into debt.

“We spend hundreds of millions of dollars in debt service every year … when we have an opportunity to make a similar impact on the bridges that have been identified as in need of repair over the course of four years and thereby save the state $100-million over 15 years I think we out to try to take that opportunity,” said Smith.

The Department has paid more than $700-million in debt payments in the last two years, and its average payment is $313-million a year.

Smith proposes spending $100-million in general revenue on roads and bridges in the next four years’ budgets or more.  That would be subject to the appropriation process in each of those years.  Smith potentially will be the House budget chairman throughout that time, and therefore would be in a position help make that happen.

State budget experts say General Revenue has never been used to pay for transportation infrastructure.  That is usually done with funds earmarked for that purpose.  Smith said it’s time to consider a fundamental change.

“The budget is a reflection of the state’s priorities and amongst those priorities should first be the core functions of government and I’d certainly put transportation infrastructure amongst the core functions of government,” said Smith.

Representative Kip Kendrick is the ranking Democrat on the House Budget Committee. (photo; Tim Bommel, Missouri House Communications)

Columbia representative Kip Kendrick is the top Democrat on the House Budget Committee.  He called Smith’s proposal bold and a part of a larger discussion about how Missouri’s transportation infrastructure should be paid for, but funding it with general revenue would pit it against other priorities supported by that fund, like K-12 and higher education.

“A hundred million dollars in general revenue, I believe, sets a potentially bad precedent.  I don’t know how you ever unwind that,” said Kendrick.  “I think we need to be looking at long-term solutions and dedicated funding streams to address our infrastructure problems at the state level.”

Smith said weighing the various priorities of the state against one another is the job of the legislature.

“That is exactly what we’re doing here.  We’re talking about how we prioritize transportation versus education versus public safety – that is the process that the General Assembly goes through and I think that’s a natural and appropriate process,” said Smith.

The Missouri Department of Transportation says it is about $8-billion short of being able to fund its transportation needs in the next decade.

Missouri voters in November rejected a 10-cents-per-gallon tax increase to pay for road and bridge work.

Smith’s plan is part of his proposed budget for the fiscal year that begins July 1.  He unveiled that plan Wednesday.  Over the coming weeks the House Budget Committee will propose changes to that plan, then send it to the full House for debate during the week of March 25-29.  Before the state budget is finalized it must be approved by both the House and the Senate, then the governor could approve, reject, or delay funding from it.