Don’t Bail Out ODOT
By Gene Krebs
January 26, 2009
Last spring Governor Strickland appointed me to serve on the 21st Century Transportation Priorities Task Force. During the course of serving on the Task Force’s Economic Development Sub-Committee, we had dozens of meetings and hearings both in Columbus and around the state. We were enjoined not to engage in a management critique of the Ohio Department of Transportation (ODOT). But at no time did ODOT explain to the task force how or why they were running out of money.
Governor Strickland’s charge to the Task Force was clear: Envision and champion the optimum transportation system for Ohio’s future and recommend the resources and financial tools needed to build and sustain it and, to see the Task Force as an opportunity to ask what should be done...and what could be done.
Over the past year, the Brookings Institution and my organization, Greater Ohio, have also developed, as a part of the Restoring Prosperity to Ohio Initiative, policy recommendations that call for transformative infrastructure investments– with the goal of revitalizing the state’s core communities and reinvigorating their economic competitiveness. The Task Force’s report recommendations that call for aligning the policies and practices of state agencies, ensuring the policies and practices are business and user-friendly; launching a Making Regions Matter initiative; and expanding the use of alternative fuels, technologies, “smart growth” solutions and public transit all dovetail with the Brookings Institution and Greater Ohio Restoring Prosperity policy agenda. Specific Task Force-recommended actions with substantial benefits include: developing a “Complete Streets” pilot program; preparing a cost/benefit analysis for transportation projects; integrating multi-modal transportation and land-use plans; and aligning local land use policies by incentivizing and promoting smart growth. We applaud these efforts.
“Fix it First” – that is, dedicating resources to fix existing roads and streets before building new – is another action item that aligns with the ODOT report; however, if we are serious about “fix it first” then we also need to require ODOT to pay for the maintenance of state highways that pass through cities, instead of stopping maintenance at a city’s edge. This suggestion did not make the report. However, it was one of the main points made by Mayor Jay Williams of Youngstown at our Restoring Prosperity Summit held on September 10, 2008. Our initial findings and policy recommendations are contained in a preliminary report that was released at the Summit – Restoring Our Prosperity: The State Role in Revitalizing Ohio’s Core Communities. (You can find the full report at www.greaterohio.org.)
The primary funding mechanism recommended in the Task Force report is an increase in the gasoline tax, with the suggestion that the revenue from that special tax be used to secure bonds as part of a capital bond financing program run by the Ohio Transportation Finance Commission. Both the proceeds of the bonds and the revenue would be made available for all transportation modes. But gasoline consumption is going down; no surprise as Hummers are traded for Hondas. Every time you trade in a car that gets 20 mpg for one that gets 30 mpg, ODOT loses a lot of revenue from you. According to ODOT’s latest business plan there will be a $3.5 billion deficit by 2015 for transportation in Ohio.
Do we really want to increase taxes on a declining revenue source? ODOT would have an even larger vested interest in keeping us in cars and burning as much gasoline as possible. Furthermore, most other states are incentivizing reductions in Vehicle Miles Traveled (VMT’s). Once again, Ohio is heading down a regressive path here.
Since we did not examine ODOT’s management issues, how do we know that there are no cost savings in the ODOT system? How do we know that this increase in gasoline tax, expansion of toll roads and increases in car registration fees generates the right amount of revenue? What is the right amount?
The proof is in the funding. The funding mechanisms recommended by the Task Force will not put Ohio on the path to long-term prosperity. ODOT doesn’t need a bailout. What it needs is greater accountability and performance criteria on infrastructure investments so it is truly transformative in meeting Ohio’s economic, social, and environment/energy goals – all consistent with Greater Ohio’s Restoring Prosperity to Ohio Initiative.
Gene Krebs is Co-Director of Greater Ohio.