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Time to Consider a New Way to Pay for Road Repairs
Op-ed By
Sen. Pat
Browne (R-16)
The
substandard condition and future needs of Pennsylvania's highway infrastructure
is an issue that plagues transportation leaders in Harrisburg. We've
consistently scored low -- and even at the bottom -- of surveys conducted of the
nation's truck drivers, the men and women who may have the best institutional
knowledge of the highway system.
Recently,
Pennsylvania added another blot to its ledger of highway and bridge woes as a
report by the American Society of Civil Engineers gave us rather dismal ratings
for our transportation system. The engineers reported that 27 percent of
Pennsylvania's roads are rated as mediocre or poor, significantly higher than
the national average of 18 percent. Of our 22,276 bridges, 25 percent were
considered structurally deficient and 18 percent were considered functionally
obsolete. Those are not reassuring statistics by any means.
Transportation
officials often point to factors that make the challenge of maintaining an
adequate highway system more daunting than other jurisdictions must face.
Pennsylvania has more than 76,000 miles of highways, of which nearly 40,000 are
state maintained -- the fourth largest state-maintained system in the nation.
And, that doesn't include the more than 4,560 miles the state has turned over to
local control since the passage of Act 32 of 1983. Furthermore, Pennsylvania's
highway system is very old. Many of our roadways follow colonial pathways,
suitable for horse-drawn vehicles, but not of proper design and engineering to
handle the ever-increasing load of heavy trucks.
Past practice
in Pennsylvania has been to fund highway and bridge maintenance through a mix of
user fees and by imposing liquid fuels taxes. With gasoline prices remaining
near $3 per gallon, this isn't a time to even consider increasing that tax.
Even so, as the engineers' report shows, we need to find new ways to address
this challenge.
One innovative
financing approach that is building momentum throughout the country is
leveraging the present value of existing highway assets through public-private
partnerships. By converting the projected future positive cash flow from
the Pennsylvania Turnpike system into a lump sum investment by a private
enterprise, the commonwealth will have available to it billions of dollars to
make necessary highway capital improvements.
Several
jurisdictions have already realized the value of this approach over the last
several years. Chicago took in a $1.83 billion up-front payment in
consideration for a 99-year lease of the 7.8 mile Chicago Skyway. Indiana
received $3.8 billion in consideration of a 75-year lease of its 157-mile
turnpike.
Turning public
highways over to private control may have been unthinkable just a few years ago,
but the market trend shows that mindset is quickly fading away. Many states,
including New Jersey, New York and Ohio, are considering leasing their toll
roads as a way to raise cash. New Jersey projects that it may be able to
realize over $20 billion in a transaction involving its 183-mile toll road
system. With Pennsylvania commanding over 583 miles in its system, an
investment of this magnitude is highly probable for the commonwealth as well.
Such a capital infusion would not only allow us to address all our pending
infrastructure deficiencies but modernize our transportation network well beyond
what present and projected liquid fuel tax receipts could provide.
One of the
biggest concerns about privatization had been that it would lead to unrestrained
toll increases. A sudden, steep toll hike would be a dual-edged sword as it
would inevitably lead some motorists to avoid the cost by using free motorways.
However, Chicago and Indiana addressed that concern by including restrictive
language in their leasing contracts.
Of course,
there is no guarantee that the quality of maintenance and service would be
sustained on our toll routes through a partnership of this magnitude. Yet,
given the infrastructure challenges we face, it is prudent to evaluate
alternative financing, rather than once again tapping citizens at the gas pump.
When
considering such public-private partnerships to address our transportation
challenges, a television commercial from a few years ago comes to mind. The ad
detailed the cost difference between an oil change and an engine overhaul caused
by running too long on old oil. We, as a commonwealth, are at a point where we
must consider the wisdom of that sardonic television mechanic when he said, "You
can pay me now, or you can pay me later."
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