Running out of gas with two critical transportation questions

Published September 12, 2013

By Tom Campbell

by Tom Campbell, executive producer and moderator of NC SPIN, September 12, 2013.

100,000 new residents call North Carolina home each year. From 1990 to 2010, our population grew by 44 percent and vehicle travel increased 63 percent. 54 percent of our major urban highways are congested, 44 percent are in poor or mediocre condition and out state is behind the curve meeting today’s needs, with no plan for the future.

Before we can address these problems there are two critical questions that must be answered: Who makes the decisions which projects to fund and how will we fund them?

Having served on the North Carolina Board of Transportation I saw first-hand that powerful legislators, influential DOT Board members and the governor made road decisions. The Perdue administration eliminated decision-making power from the DOT Board. Governor McCrory’s transportation initiatives went further, uncoupling the funding formula established by the 1989 Highway Trust Fund that allocated money equally to 14 highway division districts, instead replacing it with the Strategic Mobility Formula that would allocate funds based on data and local input.

The new formula allocates 40 percent of available road funds to projects of statewide significance, 30 percent to regions in the state and the remaining 30 percent divided equally among the 14 highway divisions for local projects that address safety, connectivity and congestion. While this is a major change in the allocations of funds it still doesn’t provide specificity as to who makes the decisions which projects to fund.

The Joint Legislative Transportation Oversight Committee met this week and raised that question, admitting they didn’t clarify those details prior to approving the Strategic Mobility Formula. Despite assurances from DOT Secretary Tony Tata that local wishes would be heard we still don’t know who makes the final decisions or how they will be made.

Even more critical is where we will get needed funds. Most states fund about 20 percent of road mileage but in North Carolina 80 percent of the responsibility for roads falls to state government. Current state revenues amount to about 3 billion dollars per year, with the federal government adding another billion; both federal and state funds are declining. More than 60 percent of state transportation revenues come from the gas tax, but with more fuel-efficient vehicles our gas usage is declining. Further exacerbating the problem is the legislature’s cap on gas taxes at 37.5 cents per gallon.

We are literally running out of gas (money) at a time when we need to be dramatically improving roads, ports, rails and transit. In 2008, Governor Easley’s 21st Century Transportation Study projected needs at 25 billion dollars greater than expected revenue projections.

Like it or not more money is needed and those who use transportation (most everyone) will have to pay.  Options include higher gas taxes, more toll roads, taxes levied on yearly vehicle miles traveled, increased funding from local governments, higher vehicle sales taxes and license fees or a major public transportation bond referendum, using the state’s borrowing power and tax revenues to pay off the debt.

It is time we face the music. Replacing one funding formula with another isn’t real transportation reform. Governor McCrory promised us a comprehensive plan and this plan must include specifics on who will make transportation decisions and how current and future needs will be funded.


September 12, 2013 at 12:39 pm
Pat Johnson says:

The Governor's comprehensive plan MUST also include a way to change a very bad law known as the Transportation Corridor Official Map Act Program. The NCDOT has held the proper owners with land in the protected corridors across this state hostage long has been 18 years for my family. Maybe the NC Supreme Court will manage to do what this governor and ones that came before and the legislatures have not been able to do.

September 12, 2013 at 3:08 pm
Richard Bunce says:

While it may very well be more money is needed for high priority road projects (not the usual political boondoggles however) there is plenty of money being spent by the State government on lower priority services that could be reallocated to the high priority road projects. The overall State budget is ~$48B so let's start looking there for another $1B or so to add to the $3B in the road budget.

September 12, 2013 at 4:45 pm
Ernie Brame says:

So, your comment "further exacerbating the problem is the legislature's cap on the gas tax at 37.5 cents per gallon" would imply that you would favor raising the gas tax. Raise it to what...50 cents per about 60 cents. I operate a large truckstop travelcenter on I-95 and I can tell you first hand what North Carolina is losing by having an egregiously high motor fuels tax in the first place. That's just diesel. Ask the convenience store operators around the borders of the state and they can tell you over and over how their residents flee to neighboring states to buy gas, Tom, please take a hard look at this view. In business, you try to find the right mix of volume versus margin to maximize your return. North Carolina is not there. You're right about one thing. There is a funding issue for infrastructure in this state. Let's all work together to find solutions without raising the gas tax even further.

September 12, 2013 at 5:42 pm
dj anderson says:

Many want the Triangle to look like NEastern cities with light rail so people can live farther and farther from their jobs. Is that really green? All the calls for Triangle light rail also serve the downtown from the west ignoring southeast Raleigh and its urban poor in the food desert. Is that fair, or right, or even wise?

IF I were king, I would not build one more foot of highway, not a single lane widened or added, nor a bridge widened. Let traffic choke itself out, but add mass transit and dedicate existing lanes of traffic to it. Tax people more who for the distance they drive to work, or even ride mass transit. Reward people who walk or bike to work. I figure I would be deposed, beheaded, and replaced after less than a season of that.

September 12, 2013 at 8:40 pm
Jack Miller says:

Self driving cars and highly efficient quad-copters have been invented that will soon revolutionize transportation, yet, we see no signs of understanding in our state. Indeed, federal authorities are using regulatory authority to slow the adoption of these wonderful technologies. Still, there is the promise that quad-copter regulations will be issued by year after next. Several states are allowing self-driving cars to either experiment or to operate. Nissan is the first big auto company to state their intent to bring the cars to market (within seven years). It is time to think a little broader than how to we convince people to pay more in gasoline taxes.

September 14, 2013 at 3:24 pm
Marsha Wyly says:

I have lived in Eastern NC for 18 years and have clients all over NE Eastern NC. I listen to my clients, neighbors and friends. I keep hearing the same stories over and over. Our roads keep getting promises for widening and improvements for the last 60 years. However, until the last 10 years all the funds have been diverted to higher priority areas in the Piedmont or roads leading to Raleigh. Roads traveling North and South in Eastern NC are a challenges due to our varied waterways. I understand that. At the same time they are our life lines that connect our communities and will provide the opportunities to grow the Inner Banks of our area.

Without good infrastructure in the Tier 1 & 2 counties these counties will continue to stay Tier 1 and 2. Poverty is not quaint. Unemployment is not a vacation. The state needs to invest in this section of the state or they will create the equivalent of a third world country in the Inner Banks.

September 15, 2013 at 10:19 pm
Ricky Evans says:

Tom, I cannot remember when I enjoyed an interview more than the one you did with Gov. McCrory on TV today. I am so worn out with "gotcha" interviewers whose interviews have little or no substance.

You focused on key issues of today and demonstrated great professionalism by letting Gov. McCrory respond without interruption.

I learned more today in 30 minutes about what has really been going on in state government at a macro level than the last 8 months of the local media Conservative haters.

September 30, 2013 at 10:32 pm
dj anderson says:

Agreed that Tom is a fine moderator. I haven't seen the interview yet.

September 29, 2013 at 10:06 am
gary charles says:

Tom - as an avid NC Spin viewer, I love the show and your mediating balance, difficult as it is from time to time. In reply to your Sept. 12 / "Running out of Gas" / Who makes the decisions which projects to fund and how will we fund them?

As a transplanted Texan, first arriving here in the fall of 1985, and observing the growth of NC over the years since - I share the following observances about infrastructure, the upcoming Wake County Bond election and what is perceived as growth and who is paying for it.

As a local contractor, and prior to the 2009 economic slow-down, not recalling where the origin of these figures were, but - in a 10 year over 10 year observation (based on permitting for new homes) - Wake County's growth was at about 85%, Durham was at 80% and Orange County was at 8%. WOW! Any idea s to why Orange was so slow? Was it by choice? Was it by design?

Actually, Orange placed "growth" costs (infrastructure - police substations, fire stations, schools, roads) as part of the elevated impact fees to the new home builder(s), which in turn chased them out of Orange and on to Durham and Wake. In Durham and Wake, these infrastructure costs were passed on to the existing property owners; under the auspice that "in time" they would make these costs back by the new property taxes. But, who pays for it in the interim? The existing people that live here, as well as, they pay for it by having less and less roads to drive on, most likely an increase in traffic accidents - which in turn raises all of our automobile insurance rates - since the insurance companies are governed to make a profit.

Basically, what Wake County is doing with their $810 billion bond for new schools for the masses of new kids (that came here with their parents, after their parents sold their more expensive per foot home in the north to come to a more affordable location here in NC - with the reduced cost per foot home provided to them by the whorish attitudes of the County Legislators saying that it is okay not to impose / include realistic impact fees to the builders & developers) is once again placing another facet of front-end costs of growth for people coming here on those residents that have actually been living here for all or most of their life.

What people fail to see is that most new residents here have "cashed in their chips", and are able to hold on to their winnings at the expense of the existing taxpayers; for failure of the legislators to have actually looked at what they were creating.

More cars, more damage to the road structures, more accidents, more taxes, less leisurely roads to travel on, more congestion, more exposure for accidents of school buses trying to get kids to school, most certainly more crime with the increase in population - with more tax increases to the existing residents, possibly, and over the long-term potentially chasing the original residents to make decisions to flee to other states with less tax rates; with the true long-term consequences for leaving the Capitol City's County in a lesser state of repair than it presently is?

One could not help but to laugh in watching this year's reports and opening comments of Wake County Schools busing issues this year. To me it is clear what the problem is, long ago immediate and short-term GREED by Wake County.

It is not two questions of Who makes the decisions and How to fund them; it is, How did we get here in the first place and Does anyone know the way back?

September 30, 2013 at 4:54 pm
Steve Bow says:

Amen to that!