NCDOT: State Faces $60 Billion Transportation Funding Gap | Eastern North Carolina Now

    Publisher's note: The author of this post is Barry Smith, who is an Associate Editor for the Carolina Journal, John Hood Publisher.

Higher taxes, tolls, vehicle-miles traveled fee may be considered to close gap between now and 2040

    RALEIGH     Transportation planners on Monday told a House committee that the cumulative gap between anticipated revenues and projected spending through 2040 would be about $60 billion.

    N.C. Department of Transportation planners Burt Tasaico and Patrick Norman told the House Select Committee on Strategic Transportation and Long-Term Funding Solutions that the state population is expected to grow to from the current 10 million to 13 million by 2040.

    Norman noted that by 2040, 74 percent of the state's population would be living in six major metropolitan areas - Charlotte, Raleigh-Durham, Greensboro-Winston-Salem, Asheville, Fayetteville, and Wilmington.

From left, Reps. Susan Susan Martin, R-Wilson, Allen McNeill, R-Randolph, and Pat Hurley, R-Randolph, listen to a presentation Monday on transportation funding projections. (CJ photo by Barry Smith)

    Norman said that keeping up with the state's transportation needs over that period would require $114 billion in spending. He said projected revenues over the same time period of only $54 billion, leaving a $60 billion gap.

    The total projected needs cover all types of transportation, including highways, aviation, rail, bicycle and pedestrian trails, public transportation, ferries, and ports.

    "I just hope we will be doing needs, needs, needs instead of wants, wants, wants," Rep. Pat Hurley, R-Randolph said.

    Traditionally, gas taxes, motor vehicle fees, highway use taxes (such as sales taxes on vehicle purchases), and some tolls comprise the bulk of revenues for transportation.

    Committee members were informed of several options to increase revenues, including raising taxes and fees, adding tolls to more highway corridors, adding surcharges to auto insurance, adding property taxes to vehicles, and charging motorists a fee for every mile they drive, aka a vehicle-miles-traveled fee.

    Rep. Becky Carney, D-Mecklenburg, noted that an earlier task force had mentioned the VMT fee.

    "The minute we threw out vehicle miles traveled, one of the members didn't even get out of here before his whole district almost was beating up on him," Carney said. "So I'm not sure that that is a way to go. It's going to take a whole lot of educating of the public if we go down that road."

    The chairman of the committee, Rep. John Torbett, R-Gaston, said after the meeting that actions taken by the General Assembly in 2015 could lower the expected gap somewhat.

    Last year, the General Assembly stopped transferring money from the Highway Fund to the General Fund to pay for the State Highway Patrol. In addition, lawmakers increased motor vehicle fees, such as driver's licenses, vehicle registration, and title fees.

    "That $60 billion gap may now be $54 billion," Torbett said.

    Torbett said predicting future transportation needs is complicated by an apparent shift in the preferred mode of transportation by younger North Carolinians.

    "There seems to be something with the millennials - with the younger generation - where they don't feel as compelled to get their driver's license or purchase an automobile," Torbett said after Monday's meeting. "So we've got to somehow figure out what a balance is to address those needs. So we may have to shift more from expansive programs to maybe go to light rail systems or subway systems, like [Washington,] D.C., or Atlanta, for example."

    Torbett said he wants North Carolina to be proactive, rather than reactive, to the needs.

    "What I don't want to do is what in my opinion the state has done and has waited until it's smacking you in the face to try to make that decision, at which time we're either obsolete or way behind," Torbett said.

    Torbett said the committee wants to wrap up its work before the 2016 short session, which begins April 25. However, he said it may take longer than that.

    "The more we dig, the more we see that we need to dig more," Torbett said.

    The committee may submit an interim report for the short session, with a few minor recommendations, and have the full report completed before the 2017 regular session, he said.