Robbing transit fund to pay...? Legislators on both sides of the tracks in paying for RR needs
Published 6:56 am, Tuesday, March 4, 2014
State lawmakers consistently voted to cut funding for vital transportation projects over the last few years, even as they criticized Metro-North Railroad for a pattern of dismal performance and service mishaps.
Votes on budgets and spending adjustments during the last years of Gov. M. Jodi Rell's administration and through Gov. Dannel P. Malloy's administration show lawmakers from both parties raided the state's Special Transportation Fund to pay routine obligations and cover deficits -- despite a growing backlog of needed rail improvements and other transportation priorities.
"We all make compromises that we don't want to make," said State Sen. Anthony Musto, D-Trumbull.
An analysis by Hearst Connecticut Media of past voting by state lawmakers representing the Bridgeport, Stamford, Greenwich and Danbury regions found that:
- Twenty-six of the 61 legislators representing 28 southern Connecticut municipalities voted against Malloy's $37.6 billion, two-year budget that cuts $109.7 million from the state's dedicated transportation revenues in 2014 and 2015.
- To close deficits during the 2012 fiscal year, 27 lawmakers voted for a package that reduced the statutorily required transfer of revenue from the General Fund to the Special Transportation Fund by $70.1 million.
- In 2011, 23 Fairfield County lawmakers voted to reduce transfers to the STF by $42.5 million. The heavily Democratic Bridgeport and Stamford delegations voted unanimously to raid or reduce transfers to the STF.
- In an apparent flip, or rebuke, of past STF raids, 52 of the region's legislators last year voted to approve a lockbox bill that ends the Legislature's ability to remove money from the STF to pay for routine budget obligations.
Senate Minority Leader John McKinney, R-Fairfield, acknowledged he has voted for bills that removed money from the STF. He also said he eagerly voted to place the STF in a lockbox.
"I've been arguing for a number of years that we should not take money out of the STF to balance the budget. We need to make the proper investments," McKinney said.
He said he voted against the current state budget for a variety of reasons, including the fact that for this year it removed $76.5 million from the STF. In the past, McKinney said he voted for deficit mitigation packages that removed smaller amounts because that was the deal he had to make.
"You have to look at everything, there are balances and priorities," McKinney said. "I voted for a deficit mitigation package that took $10 million out of the fund, given the fiscal problems. It's not great, but it was something I was willing to do. I've seen worse deals."
Musto said many of his votes were cast to protect education funding, municipal aid and avoid tax increases, even if money was diverted from the STF or not transferred to it.
"You make the best decision you can," he said. "I'd like to see a lockbox for many things. We did what we had to do. It's unpleasant. Sometimes to pass a budget we had to break the deal. But the lockbox is something we should be doing more of."
State Rep. Linda Gentile, D-Ansonia, who voted for budgets between 2010 and 2013 that removed money or reduced transfers to the STF, said she cast those votes to avoid further tax increases.
"It's a practice I'm not proud of, but it's more palpable than to heap another tax increase onto our taxpayers. You have to make tough choices," Gentile said.
She said she eagerly voted for the lockbox bill last year to prevent what's become a common practice of raiding the STF when money is tight.
"That will prohibit us from doing that. The money will be used for highways, bridges and rails," Gentile said.
Originally created in 1983 by Gov. William O'Neill after the collapse of the Mianus River Bridge to help shore up and expand the state's transportation network, the Special Transportation Fund is primarily supported by two separate taxes on gasoline that make up about 70 percent of the fund's anticipated revenue for 2015 of $1.331 billion.
The first is a flat tax of 25 cents paid by drivers at the pump; the second is a petroleum gross receipts tax, a levy on the wholesale price of gasoline paid by distributors.
In 2005, the legislature passed a gross receipts tax hike under Rell which gradually raised the rate of the tax from 5 percent to 8.1 percent, in part to bolster funding for transportation.
With rising gasoline prices, revenues surged far beyond expectations while a designated minimum to be devoted to road and transit needs remained fixed by law.
Since 2005, $1.26 billion of the proceeds of the tax has stayed in the state's General Fund, rather than being applied to needed transportation projects. But hundreds of millions of dollars have been diverted to pay routine state obligations or blocked from being deposited into the STF.
Joseph McGee, vice president of public policy for the Business Council of Fairfield County, said business leaders see the link between the depth of the state's infrastructure funding gap and failure to assign appropriate revenue to tackle them.
"The lack of sustained commitment to transportation infrastructure spending has been a major impediment to economic growth," McGee said. "There is an urgency to address this that cannot be kicked down the road another five years, and the political leadership of the state and executive leadership of the state have got to come together on this."
The Malloy administration recognizes investment in the New Haven Line and highway infrastructure is critical, said Andrew Doba, a spokesman for the governor.
Doba said the budget has increased appropriations to the Special Transportation Fund for the past three years, including $1.243 billion and $1.333 billion in 2014 and 2015 for projects.
Malloy said last month that his 2015 budget would also dedicate the full stream of the petroleum gross receipts tax to transportation projects.
"The idea that this administration had reduced support for the Special Transportation Fund is just plain wrong," Doba said.
House Minority Leader Larry Cafero, R-Norwalk, said he voted against recent budgets for a variety of reasons, including removing money from the STF. He said he voted for a deficit mitigation plan in 2010 that removed money from the fund because at the time the state's deficit was so large that the state constitution mandated action.
"We were in very deep trouble and we were elected to solve problems," Cafero said. "We got no taxes raised. It was a compromise, a bipartisan bill. And at the time we had a surplus in the STF."
Cafero said for years the state has wrongly raided the STF, and that's why he voted for the lockbox bill.
"We have had a system in place in the state in which we were told certain taxes would go to a special transportation fund," he said. "What I saw was a consistent raiding of that and going back on our word. That's why people get disgusted with government."
The General Assembly's Transportation Committee will review a bill Wednesday that would further reenforce the lockbox legislation by making it an amendment to the state constitution. Twenty-six other states have similar legislation prohibiting legislative bodies from raiding dedicated transportation funds.
State Sen. Kevin Kelly, R-Stratford, said he voted against budgets in 2012 and 2013 in part because of the removal of money from the STF. He said the lockbox legislation, which he voted for, was necessary to stop that trend.
"The STF funds are revenue generated for the purpose of transportation. The gas tax goes to funding the STF. When taxpayers make that contribution we should recognize it. We have high gas taxes in this state, and that's the justification," Kelly said.
State Sen. Bob Duff, D-Norwalk, who voted in favor of the budgets and adjustments that shifted transportation revenue for general fund costs for all four votes, said the 2014-15 budget includes more money for Norwalk schools.
State Sen. Toni Boucher, R-Wilton, who voted against Malloy's past two biennial budgets, said she's worried about whether the General Assembly will have the discipline to not repeal the lockbox restriction when faced with future deficits.
"The fund is as safe as any governor, General Assembly, or House allows it to be," Boucher said. "We can make a big issue of it, but if the president pro tem of the Senate decides we're going to take (the money) out, it is hard to stop it."
State Sen. Carlo Leone, D-Stamford and a member of the Transportation Committee, voted in favor of the transfers from 2010 through 2013. He said even if legislators voted against the spending packages on principle, it wouldn't have been enough to stop the transfers.
"There is always some kind of budgetary constraint and sometimes there are fund sweeps or adjustments from one fund to another," Leone said. "The bigger-picture question is whether the budget is something we can support each year when those budgets are presented, and the answer is sometimes yes."
"We didn't have the situation then that we now have with Metro-North," added state Rep. Auden Grogins, D- Bridgeport. "Now I think we are all in favor of the keeping the money there."
One of the bigger impediments to expanding the New Haven Line's capacity are four century-old swing bridges that limit the speed of trains and can become stuck open and halt service for hours.
While some funding has been allocated to design two of the bridges, it is unclear when they will be fully funded.
The state is also expected to fast-track installation of a mandated state-of-the-art collision avoidance system called Positive Train Control that the Metropolitan Transportation Authority estimates will cost $900 million for Metro-North and the Long Island Rail Road.
The DOT has projected that through 2016 the state needs more than $2 billion to maintain transportation infrastructure, including for highways.
Earlier this month, a group of legislators signed a letter asking the Federal Railroad Administration to intervene to help make management changes at Metro-North Railroad after a disastrous 2013 that has galvanized a commuter-driven backlash against state officials.
"These problems have come at a time when we have raised the gas tax and raised the fares on all of our trains," said Boucher, who signed the letter. "There is now a clarion call, and I'm not alone. There are Republicans and Democrats who are very upset with this."
Fred Carstensen, a professor with the University of Connecticut's Center of Economic Analysis, said pledges by gubernatorial candidates, including Malloy, promising tax cuts are the wrong medicine to boost the state's economy, especially given the state's road and rail infrastructure needs.
"Connecticut's long-term malaise -- stretching back at least 25 years -- is the result of a systematic, pervasive failure to invest in and sustain the quality of its transportation infrastructure and human capital development," Carstensen said.
Along with higher education spending, Carstensen said the state's underinvestment in Metro-North, and establishing train service in other parts of the state have left workers with few options beside getting around by car.
"Why would a company that needs to draw together a lot of employees come to a state with a weak transit system?" Carstensen said.
State Rep. Larry Miller, R-Stratford, said he voted against most state budgets because he's committed to reining in spending. But Miller stopped short of wanting money taken out of the transportation fund, or restricting the flow of money into the fund.
"I don't think they should take money out," he said. "Our bridges are not the best. We have suggested different things from the Republican perspective."
Staff writer Bill Cummings contributed to this report.