MoDOT: No new projects; local maintenance, snow removal to continue
Motorists traveling in Vernon County can expect current Interstate 49 construction projects to keep on rolling along to completion, but the Missouri Department of Transportation's budget's running on empty when it comes to new projects and maintenance. MoDOT's annual operating budget, from which new and ongoing construction and maintenance is drawn, has plummeted from $1.2 billion annually to an estimated $600 million because bond proceeds have been spent and half of the state's transportation revenue must now go to repay the bonds. Under Amendment 3, passed overwhelmingly by voters in 2004, more than $1.9 billion in bonds were sold to pay for the highway construction boom of the past five years.
Kevin Keith, MoDOT director, said in a May 5 press release, "This is not a surprise. We knew this day was coming. We've fallen off of the cliff. We're at the bottom, and now we have to pull ourselves up, scrape the dust off and figure out what we can do to increase funding for transportation."
The "Bolder Five-Year Direction"
Citizens, Vernon County Commissioners, State Representative Barney J. Fisher gathered to hear more from MoDOT Southwest District Engineer Becky Baltz about the departments' "Bolder Five-Year Direction," a plan to cope with the budgeting squeeze.
That means the department is looking at drastic changes in how it does business -- changes that mean a reduction of 1,200 employees, the closure of 135 facilities, and the sale of some 740 pieces of equipment, statewide. Some of those reductions already have taken place. A wage freeze has already been in place for four years.
Baltz said that in southwestern Missouri, 11 facilitities were to be closed. Six, including the Sheldon and Liberal sites, have been closed already; with the Appleton City, Rich Hill, Sarcoxie, Longview and Jenkins facilities to close in the future. The Nevada facility will remain; an assistant engineer will be assigned to the Nevada facility.
Baltz said that statewide, there will be a 12-percent reduction in staff in operations (maintenance staff and so forth), a 31-percent reduction in administration staff and a 27- percent reduction in project development staff.
Baltz said, "We're still on our same direction with keeping our major roads in good condition ... and then improving our minor roads. And you're going to see a lot of projects, still, on the minor roads. The big thing is ... that you won't see a lot of big interchanges, once we finish I-49 you're not going to see those big interchanges; you're not going to see those big, systematic safety improvements like large cable all the way across the interstate. You'll still see a lot of resurfacing, and a lot of bridge projects, and a few spot safety improvements. That's the type of program we'll be able to have," Baltz said.
District lines will blur more than they have in the past, Baltz said. For example, during snow removal, "Where we used to stop at the county line no matter what, we'll keep going to the end of the route instead of stopping at that invisible spot." Other changes will occur in snow removal as well -- because the locations of some of the equipment will change, the starting point for snow removal will change for many areas; and in cases of extreme cold, workers may go home overnight when little progress can be made and return to the effort during the day when snow removal can be more effective, Baltz said. Last year, some other changes were made as well, to make judicious use of salt; "a ton of salt costs about the same as a ton of asphalt," Baltz noted, but years of benefit comes from the asphalt; the salt's benefits last only a day or two.
How it all happened
In 2004, Missouri voters passed Amendment 3, which earmarked the lion's share of fuel taxes and "vehicle taxes and fees paid by highway users be used only for constructing and maintaining the state highway system" in the state -- except that half, under a program phased in over four years, would go to a bond fund to repay highway bonds.
In 2009, the last of the Amendment 3 bonds were sold. and, on the upside, then MoDOT Director Pete Rahn said in October 2009 that "83 percent of Missouri's major highways are in good condition, compared to 47 percent in 2004." Recent reports now say that 86 percent of those highways are in good condition.
By using bonds MoDOT officials said were required under Amendment 3, instead of building on a pay-as-you-go strategy, 55 projects were accelerated and 75 new projects had been taken on, ranging from resurfacing to the construction of new interchanges -- projects the MoDOT officials said in 2009 wouldn't have been addressed for years without Amendment 3.
Rahn warned in 2009 that a dramatic decrease in funding was looming ahead. A slumping economy meant sluggish car sales, and spikes in the cost of gasoline meant fewer gallons were being purchased, pulling the transportation revenue down by $52 million in 2009. "We've had a good ride, but we won't be able to maintain the momentum we've gained unless we identify new sources of revenue for transportation," Rahn said.
American Recovery and Reinvestment Act funds helped in the short term, but MoDOT community relations manager Sally Oxenhandler said Thursday that "the main reason for the dramatic decrease in funds available ... results from the expenditures of all the bond proceeds and the ending of the extra federal funding dollars received as a result of the American Recovery and Reinvestment Act," said Sally Oxenhandler, MoDOT community relations manager.
Oxenhandler said that from 2005-2009, Amendment 3 bonds were issued totaling $1,977,460. Of that, $1,750,525 is oustanding; the total bond debt, including both the Amendment 3 bonds and others issued since 2000, is currently more than $3.2 billion. All of the money flowing into the bond fund is currently needed to repay Amendment 3 bonds, with the last of them to be paid off May 1, 2033. Fisher noted during Thursday's meeting that bonds can't be paid off early due to penalties.
Looking for solutions
"While these cost savings provide a temporary fix, they do not solve our funding situation in the long term," said Keith.
Right now, the "Bolder Five-Year Plan" is the department's primary means of coping with the dearth of transportation funding.
Those attending Wednesday's meeting wondered about tolls, going to voters for adjustments in the fuel taxes, the possibility of asking voters for a sales tax and more.
Tolls are unlikely. In fact, Fisher said, "it's not gonna happen. I can tell you there is no sentiment in the General Assembly for toll roads."
Baltz noted that as gas prices go up, consumption goes down, which means motor fuel tax revenue declines.
That leaves a sales tax; the Missouri Budget Project estimated in 2007 that a 1/2-cent sales tax would generate about $340 million. No sales tax proposal has been brought forward at this time. "The people are in no mood for new taxes," Baltz said.
For more information about MoDOT's "bolder" plan, visit www.modot.gov.