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Highway Funding: Trying a different route

Highway Leaders toss out possible funding approach.
By Brenda Blagg (AR Democrat-Gazette, NWA edition)

State highway officials have come up with an alternative plan to fund needed projects.

This one, which notably does not reach into state general revenue, might actually have a chance of finding support.

Scott Bennett, the state's highway director, offered the proposal at a meeting last week of the state Highway Commission.

If approved, it would add a 6.5 percent excise tax on the wholesale price of fuel and extend a 0.5 percent state sales tax for another 10 years.

Those levies would help raise about $8.4 billion over a decade for highway and bridge maintenance and for some capital projects.

Thank Gov. Asa Hutchinson's strong opposition to use of general state revenue for highways for the change of direction. Back in October, the governor said he would "vigorously oppose" any effort to use Arkansas general revenue for road construction.

He seems to have made believers out of the independent Highway Commission and the director of the Arkansas Highway and Transportation Department the commission oversees.

There is little more acceptance for a raid on the general fund in this Republican governor's administration than there was in past administrations.

Like other governors before him, Hutchinson said the state simply cannot afford to divert general revenue that supports public education, higher education and other critical state needs to other use.

Besides, if there's any growth in that particular source of revenue, Hutchinson said he wants to reduce income tax rates.

The governor's position left those seeking money for highways looking for other options. Last week, Bennett revealed where they're looking, although nothing has been finalized.

Bennett called his added excise tax and extended sales tax proposal his "first shot" at something to present either to the Legislature or to the electorate.

Efforts to get the Legislature to refer a highway proposal to voters failed the last time, which led highway backers to consider going directly to state voters with a ballot initiative next year.

Rest assured, not everyone has abandoned the idea of trying to get into general revenue, even with the governor's strong opposition.

But it seems less likely now that Bennett is offering an alternative for consideration.

As Bennett explained last week, his department could eventually expect another $384.6 million each year under the new plan.

Actually, quite a bit more money would be generated, but the department would get only 70 percent of the total. Under a long-standing formula, 15 percent would go to Arkansas cities and 15 percent to the state's counties.

Highway commissioners will eventually have to sign off on whatever approach is chosen.

The sooner they decide on something the better, especially if the plan is to go the initiative route.

It will take time and more than a little effort to sell any highway program to the electorate.

First, voters need to believe the state and localities must have the money.

And most will want to know what they can expect in return, whatever pocket the money might come from.

The highway department has been successful in the past by presenting specific plans for use of proposed tax hikes. Bennett is clearly trying to do so again.

The department is still pulling those details together, but Bennett gave a glimpse of the program last week.

For example, he said there would be money enough to repair or replace all bridges that are either structurally deficient or have posted weight limits and to prevent other bridges from becoming structurally deficient.

And he said this new level of funding would allow improvement of maybe half of the state's 16,000-mile road system.

He'll have more details later.

By the time voters might be engaged, those plans will likely map where any improvements will be made.
Selling this -- or any highway program -- to voters will require nothing less.

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