October 28, 2004

A message to our state legislators:

Stop ‘borrowing’ our transportation funds

Pat Dando
Vice Mayor

As a member of Governor Schwarzenegger’s California Performance Review Commission, I’ve heard a multitude of different ideas on how to make every aspect of our state government more efficient, effective, and responsive.

However, when transportation is discussed, a clear, universal theme emerges: our economy and quality of life are seriously threatened by ongoing legislative actions that ignore our growing transportation needs.

For years, special state and federal fuel taxes have been used to improve our highways, repair our roads, and build our public transit systems. On several occasions, Santa Clara County voters have approved local sales tax measures to supplement these revenues.

When these combined efforts fell short in the late 1990s, the State Legislature passed the Traffic Congestion Relief Act of 2000. This Act, which was to be limited to six years, dedicated funds that were already being collected from the gasoline sales tax to transportation purposes. It promised more than $1 billion annually to jump-start projects that would relieve traffic congestion, improve our transportation infrastructure, and generate jobs. In 2002, over 70 percent of California voters went a step further and approved Proposition 42, which made the sales tax collected on gasoline a permanent, rather than a temporary, transportation funding source. However, the promise of the Traffic Congestion Relief Act and Proposition 42 has gone unfulfilled.

The previous governor’s signature was barely dry on the legislation when the economy experienced a downturn and state leaders began taking back gasoline sales tax dollars to help cover General Fund deficits.

In California, on each gallon of gas we pay as much as 60 cents in excise and sales taxes, which are supposed to fund transportation projects. But they’re not. In total, more than $3 billion in highway and public transit dollars have been “borrowed” over the past three fiscal years to balance the state budget. For Santa Clara County, that translates into more than $500 million in transportation dollars that have been snatched from us. That spells delay in completing projects and the loss of new jobs.

These so-called “loans” caused a three- to five-year delay for such critical projects as Highway 152 safety improvements, community soundwalls along freeways, and I-680 carpool lanes over the Sunol Grade. It brings uncertainty as to whether the state will live up to its commitment to provide its funding share for the BART extension to Silicon Valley. It means delays to plans to expand Caltrain commuter rail service in Santa Clara County and extend it to Monterey County. And, by holding these funds Sacramento stymies job creation and economic recovery, as every $1 billion invested in transportation creates nearly 47,500 new jobs.

Instead of helping us address our transportation needs and create new jobs, the state is only holding us back.

The practice of propping up the state’s budget with transportation dollars must stop. We must make it harder for the state to raid transportation accounts for general government programs and require timely repayment, with interest, of all previous loans. A level of accountability ought to be added to the state budget process to ensure a balanced budget that does not continually defer improvements to our transportation system. We must take steps to ensure that transportation revenues get used for their intended purpose.

An effective transportation network is vital to our economy, our safety, and our quality of life. Our legislators must keep faith with California voters and get Proposition 42 money back to work in our communities.

Pat Dando is Vice Mayor of San Jose, a Santa Clara Valley Transportation Authority (VTA) Board Member, and serves as Chair of the League of California Cities & National League of Cities’ Transportation Committee.