By Eric Sundquist
California’s longstanding principle of relying on locally generated funds and suballocated state fuel taxes to improve the state highway system poses a principal-agent problem: Local funders have every incentive to fund expansions while leaving costly owner-operator responsibilities, including eventual reconstruction, to an increasingly cash-strapped state DOT.
The Brown Administration has been working to improve state-local-federal cooperative arrangements to better cover post-ribbon-cutting needs. One remedy is proposed legislation that expands pricing on the state highway system to ensure capacity increases have attached revenue streams that can be used to operate and maintain new capacity.
The legislation is the product of a stakeholder workgroup convened by Transportation Secretary Brian Kelly last year to study funding challenges. The group’s recommendation to expand and streamline the approval for projects that include ongoing pricing mechanisms—and the subsequent legislative proposal—now enjoys broad stakeholder support.
This month Kelly published an op-ed urging a life-cycle approach that prioritizes system preservation. While focused on California, it resonates nationally, as all states wrestle with how to fund maintenance, and many consider local sales taxes to cover highway costs.
Once the concrete dries on a new transportation project, the hard work begins: maintaining and preserving the infrastructure for decades of use by commuters, freight and businesses. Unfortunately, those maintenance costs are not typically included in the financing when construction work begins. As a result, there’s a multibillion-dollar maintenance backlog on California’s streets and roads.
For years, Caltrans has built the projects that local communities want and those projects are typically new construction. Ribbon-cutting ceremonies may be more exciting than routine maintenance, but it’s unwise to build something new without a commitment to maintain it….
It’s time to include the total cost of building new transportation infrastructure: the price of construction and the cost of long-term maintenance that will stretch out for decades. Working with our local, state and federal transportation partners, it’s time to prioritize these life-cycle infrastructure costs and commit revenue to new construction with a funding plan in place to maintain it.
Eric Sundquist is Managing Director of SSTI.