Texas voters to decide transportation funding

Proposition 1 on the November 4th ballot adds new funding for transportation – if approved by Texas voters.

The funds will come from oil and gas production taxes. These taxes now go to the Rainy Day Fund, officially known as the Economic Stabilization Fund.

The proposed amendment would re-direct half of the revenue from oil and gas production taxes to the State Highway Fund. Since the Rainy Day Fund usually receives 75 percent of the oil and gas production taxes, the Rainy Day Fund portion of the revenue would be lowered to 37.5 percent. The State Highway Fund would also receive 37.5 percent of the taxes.

While Proposition 1 would authorize a dedicated funding stream for transportation projects, it also would allow the Legislature to take necessary means to ensure that a minimum balance in the rainy day fund is available to respond to natural disasters and fiscal emergencies. HB 1, the amendment’s enabling legislation, calls for the appointment of acommittee of legislators to determine a sufficient balance for the Rainy Day Fund. If the Fund falls below that balance, no general revenue would be transferred to the State Highway Fund.

The Texas Department of Transportation estimates that it needs $4 billion for constructing and maintaining public, non-tolled roads, and $1 billion for new highways. Proposition 1 could be used only for constructing, maintaining, and acquiring rights of way for public roadways other than toll roads.

Elaine Wiant, President of the League of Women Voters of Texas says the measure isn’t enough.

“The need for more transportation funding is no longer in question, in fact, it is a crisis,” Wiant said. “The funds provided by Proposition 1 will not be sufficient to meet the transportation needs in Texas. Additional funds will be necessary, even if the voters approved Proposition 1.”

According to Sen. Robert Nichols, author of the bill which created Prop. 1, the state needs a solution to its transportation funding.

“As our population continues to increase, traffic rises and our highway system ages, it is important to ensure we have a continuous funding source to maintain our states highway system,” Nichols said. “Transportation is a core function of state government and has been substantially underfunded for more than the last decade.

“Proposition 1 will authorize annual deposits, generated by oil and gas production, to be constitutionally dedicated to the highway fund for construction and maintenance of the state’s non-tolled roads and bridges, without raising fees or taxes. I strongly endorse Proposition 1 as part of the overall transportation funding solution.”

Those in favor of the amendment think that the need is great and these funds would help with the $5 billion need for transportation. If Prop. 1 passes, an estimated $1.6 billion would go toward the current and future transportation needs. Furthermore, the Rainy Day Fund will be watched over by a committee to see that it maintains a sufficient balance.

Those opposed to the amendment think that it deprives the Rainy Day Fund of revenues that will be needed to respond to natural and fiscal emergencies. Other opponents think that it is an insufficient remedy, as Rainy Day Funds could be unstable and the funds produced are not enough.