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ANALYSIS | What the Transportation Lockbox Will Do - And What it Won’t

by | Nov 12, 2018 12:44pm () Comments | Commenting has expired | Share
Posted to: Analysis, Election 2018, Opinion, Public Safety, State Budget, Taxes, Transportation

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We in Connecticut never agree on anything except how miserable we all are, but on Tuesday over 85 percent of voters ratified the two proposed amendments to the state constitution. One, which will create a constitutional “lockbox” for the Special Transportation Fund, has the potential to influence our lives in a big way — but how is that going to work?

The Special Transportation Fund is a portion of state money set aside only for transportation. Revenue flows into the fund from sources like the gross receipts tax, the gas tax, motor carrier taxes, and DMV fees, which makes sense as they’re all related to transportation and the expensive-to-maintain road system (public transit has its own revenue stream — fares).

In theory this sounds great. We pay taxes on gas, which we use to drive all over the roads, and those taxes help pay to fix the roads back up.

If only it were that simple. The reason this amendment is long overdue is because of the General Assembly’s massive impulse control problem. When the budget gets tight, legislators’ eyes have sometimes turned toward the Special Transportation Fund, and that cash finds its way into the General Fund instead.

This happens despite the fact that there’s a law on the books saying touching that money for anything but transportation is forbidden! But thanks to a complicated legal theory that says one legislature can’t impose its will on any following legislatures, that law is essentially unenforceable.

Therefore, when the legislature voted to send this amendment to the people, they were in essence begging us to save them from themselves. We delivered. Here’s the text of the new amendment to the state constitution:

The Special Transportation Fund shall remain a perpetual fund. The general assembly shall direct the resources of said fund solely for transportation purposes, including the payment of debt service on obligations of the state incurred for transportation purposes. Sources of funds, moneys and receipts of the state credited, deposited or transferred to said fund by state law on or after the effective date of this amendment shall be credited, deposited or transferred to the Special Transportation Fund, so long as such sources are authorized by statute to be collected or received by the state, or any officer thereof, and the general assembly shall enact no law authorizing the resources of said fund to be expended other than for transportation purposes.

So now what?

The immediate impact will be felt in January when the next session of the legislature meets and the tough discussions about how to fill yet another massive budget gap begin. Transportation funding will be protected from whatever fiscal apocalypse awaits us, which, in a state where so much of our infrastructure is rapidly decaying, is a relief.

That doesn’t mean transportation programs will be adequately funded, however. In fact, because cars are getting more fuel efficient, money from the gas tax in the fund has been slowly dwindling over time. That means that unless lawmakers raise existing transportation taxes and fees or add a new source of revenue, we’ll be just as bad off as we are now, if not worse.

That’s a major problem with the lockbox — it doesn’t specify funding levels or any kind of consistency, just that certain pots of money are off-limits for general spending. And while it does ensure that revenue from a tax or fee can’t be removed from the lockbox unless the entire tax or fee is repealed, it also doesn’t mandate that if one source of money goes away it be replaced by something else.

In short, future legislatures could let the Special Transportation Fund wither and die on the vine by repealing entire taxes and then turning around to pass new ones that can go in the general pot.

If we do end up with tolls on the roads, this is one of the dangers. The legislature will likely specify that the revenue from tolls be solely directed to transportation, but they don’t have to. Since the lockbox amendment only applies to revenue explicitly designated for the Special Transportation Fund, the easiest way around it would be to leave that designation off the bill.

Imagine this scenario: the legislature enacts tolls and promises to cut or even get rid of the gas tax as an incentive for people not to flip out. If toll money can go into the general fund because it’s not designated for transportation only, then the fund is going to dry up fast.

Other states with lockboxes like this have struggled, because a lockbox like this does require a certain amount of good faith on the part of the legislature which, surprise, is never forthcoming.

That means that we’re going to have to be vigilant. When tolls come — and they will — the revenue from them must be specifically dedicated to the Special Transportation Fund. If that doesn’t happen, we could find ourselves going through an awful lot of pain for nothing.

Susan Bigelow is an award-winning columnist and the founder of CTLocalPolitics. She lives in Enfield with her wife and their cats.

DISCLAIMER: The views, opinions, positions, or strategies expressed by the author are theirs alone, and do not necessarily reflect the views, opinions, or positions of CTNewsJunkie.com.

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