Patrick B. McGuigan
OKLAHOMA CITY – The man who runs the state Association of General Contractors (AOGC) makes his case for continuing the momentum of recent years toward transportation infrastructure improvements in the Sooner State.
“Science and engineering should be determining the future of roads and bridges, not politicians.
"The alternative is we go back to the Gene Stipe days, where politicians determine what bridges get repaired and improved, rather than the science-based plans that have been developed,” Bobby Stem said in an interview last week.
His reference to the late Sen. Stipe, D-McAlester, distills what Stem says is the heart of the matter, in a tough budgeting year for state government. Stipe was Oklahoma’s most powerful politician for a few decades. Although well-known for affability in personal encounters, he rewarded friends and punished enemies through his role in the budgeting process. Both beloved and reviled, for most of his career he dodged legal accountability for his exercise of power. Convicted of federal campaign violations in 2003, Stipe was indicted (and not prosecuted) for other violations in 2007. He died in 2012.
In this year’s debate over funding for roads and bridges, Stem has important allies, with two players in the annual “Big Three” spending equation more or less in agreement with his point of view.
Governor Mary Fallin in February sustained her consistent (http://www.capitolbeatok.com/reports/fallin-unveils-plan-to-revamp-state-bridge-system)
pro-infrastructure stance, while saying some tinkering with revenue streams might be in order.
The governor’s executive budget proposal, outlined in her State of the State speech, would “ensure taxes associated with roads and bridges are the funding source for maintenance of roads and bridges -- period, returning individual income taxes to the General Revenue Fund. This plan does not impact the projects in the Department of Transportation’s 8-year plan.
“Oklahoma currently ranks 48th in diesel tax in the nation and 49th in gasoline tax. I am proposing a new revenue stream by increasing our gas and diesel taxes to the regional state average, but still below the national average. As we’ve discussed for decades, let’s put the fuel taxes into roads and bridges.”
While funding sources and redirection of existing streams remain a jump ball, it seems clear that both the governor and the state House majority -- building on a framework established (http://www.capitolbeatok.com/reports/fallin-signs-bills-boosting-funding-for-department-of-transportation) after the GOP took control of state government in 2010 -- are working to sustain the eight-year roads and bridges plan as a state priority.
Speaker of the House Charles McCall, R-Atoka, careful in his use of words, has said nothing to counter that interpretation of the budgetary landscape. The same can be said of House Appropriations and Budget Chairman Leslie Osborn, R-Mustang.
Similarly, leaders in the state Senate explicitly listed support for the eight-year plan in their listing of priorities for the 2017 session. However, in a bad budget year “priorities” can be defined in varied ways. In the upper chamber’s budget and appropriations process, major changes to the “off-the-top” funding mechanisms are possible under Senate Appropriations Chairman State Sen. Kim David, R-Porter.
Senate Pro Temp Mike Schulz, R-Altus, has often told reporters that “everything is on the table” for consideration, given the nature of this year’s revenue flow.
In late February, Oklahoma Watch reported (http://oklahomawatch.org/2017/02/27/in-search-of-a-grand-bargain-ways-to-bridge-budget-gap/) on the search for a “grand bargain” on the budget, noting that proposals were already floating to defer by nearly $60 million the scheduled boost to the highway and bridge maintenance fund.
Oklahoma Policy Institute, based in Tulsa is a “think tank” that offers progressive/liberal analysis about state government. Among possible changes in spending priorities (http://okpolicy.org/2017-policy-priority-revenue-options-better-budget/), OK Policy has suggested that legislators “[d]efer increases to the ROADS Fund. The ROADS Fund for highway and bridge maintenance is slated for an automatic $59.7 million increase in FY 2017, bringing its total to $576.7 million annually. The Legislature could defer that increase, which would lead to some maintenance and repair projects being delayed.”
In an interview with CapitolBeatOK, Stem, who also serves as treasurer of Oklahomans for Better Roads and Bridges, combined understanding for the worse-than-usual conundrum for the Legislature with firm opposition to “removing us from the off-the-top money.” He says the state’s contractors, who are in the early-to-mid stages of building out the transportation infrastructure, are “respectfully but firmly opposed to that idea.”
In an interview with CapitolBeatOK, Stem said, “In return for the privilege of having off-the-top flow of money there should be a requirement, or a practice to step forward with a long-term financial plan. That separates the wheat from the chaff. The privilege of having off-the-top money should come with accountability for the use of that money.”
Stem stresses that for roads and bridges, the state has an explicit eight-year plan that touches all 77 counties, and recurring documentation of spending and progress.
“We have an 80-page spread sheet. Every month it lists every county where we are going to spend money” to fulfill that roads and bridges plan.
“We know and understand that all agencies, including the Department of Transportation, will take some kind of ‘hit.’ We get that. What we can handle is some kind of a hit, perhaps with bonding authority combined with that,” Stem said.
The reference to bonds expressed his group’s cautious support for the idea to finance some portion of the infrastructure plan with state-issued bonds, as a trade-off for some loss in direct appropriations.
As for the governor’s idea to shift the funding steam toward fuel taxes, perhaps phasing out use of incomes taxes for transportation, he commented, “If more gas tax is necessary, as long as it can’t be raided [by legislators] we’re OK. In a perfect world, ODOT gets it all. … And when I say ‘all,’ I recognize that our state troopers are to get a percentage to finance some of their needs.” As for the latter exception, he argues it is not really an exception, given the obvious tie of the Highway Patrol to road safety.
In a new advertising push, Stem’s group is pointing to bridges identified as dangerous and on the near-term repair and rebuild list (www.NotEvenANickel.com). He is pressing a theme that tax-financed ground transportation gets five cents of every state tax dollar, even though it “is the one thing that most Oklahomans use each and every day, year-round.”
The clock is ticking for resolution of state budget questions in the most difficult financing year of the modern era. Stem and his allies are making the case for an outcome that might tweak roads/bridges a bit, but limit damage to the hard-won infrastructure plan that Republicans promised during the 2010 campaign, when the GOP took control of all of state government.