Commentary: State Transportation Package a Reminder of How We Got in this Mess

Share:

pothole-2Back in July, Dan Carson first reported that the state was making inroads on a transportation package that might have been able to provide the city of Davis with about $3 million annually in roads funding. In early August, it appeared a bipartisan consensus was emerging with the California Chamber of Commerce, joining with unions to support a funding mechanism.

As Dan Carson put it, “A proposal backed by a coalition of business, labor, and local government organizations would have provided $6 billion a year for this purpose for a decade, split between the state and local governments. The League of California Cities estimated that the package could have bolstered funding the City of Davis could use for road maintenance by $3 million annually.”

However, the governor undercut this proposal by proposing a smaller compromise package that was quickly endorsed by the League of California Cities, the California State Association of Counties, and other organizations that had originally lobbied for a bigger effort.

That package still would have delivered $1.1 million annually for ten years.

But Mr. Carson writes this weekend, “Passage of any measure in the state Capitol at all this session is now very much in doubt. Legislative Republican leadership welcomed the start of negotiations over the Governor’s proposal and praised some of its specific provisions, such as one to use $500 million in ‘cap-and-trade’ revenues for roads or to reduce excess Caltrans staffing and shift the monies to highway projects. But Republicans rejected the administration’s proposal to provide part of the funding with a new $65 a year ‘highway user fee’ and a 6 cents per gallon gas tax increase, contending no new tax revenues are needed by the state.”

We’ll stop the recap right here. Mr. Carson, who is generally more optimistic about such things as I am, suggests that this series of events “have turned efforts to bolster roadway funding into an uphill fight.”

Back in 2013, we ran a data analysis on where the city received the bulk of its funding for pavement contracts 2000 through 2012. During that time, the city only used $577,862 from local general funds. It received $1.86 million from State Transportation Funds, $5.5 million from Federal/State Highway funds, $1.37 million from Prop 1B, and $1.3 million from the stimulus package.

In short, over 12 fiscal years ending in 2011-12, the city spent $10.6 million, and just over $10 million came from the state and federal government.

Since that time, funding from the state and federal government has been cut off. As a result, the city’s roadway conditions have dropped perilously, moving from generally in good shape to on the brink of failure in many critical locations.

By 2013, estimates for cost were staggering – over $150 million if we acted soon, and approaching half a billion if we continued to wait. The result was that over time the city, starting in 2011, started funding road maintenance from the general fund – first at $1 million and now at $4 million a year.

A good portion of the city’s structural deficit has been created by the transfer of money to fund roadways. But part of our previous criticism of the city budget was it failed to reflect in any meaningful way unfunded liabilities and deferred maintenance, which would hold costs at the current budget line but at a significantly increased hit down the line.

The failure of the transportation package – if it indeed fails, simply re-affirms our belief from earlier this summer. The city must move forward with its own local funding package regardless of what the state does.

Sometime this fall, city staff will come back to the council with a proposal for a utility user tax that could fund city infrastructure. There are a lot of concerns about a utility user tax. In part that is because the tax would fund construction that, in general, would be far afield from what the funds would go toward.

There is also the fact that utility user taxes have a very low passage rate.

Staff believes there is some advantage to a utility user tax over a parcel tax. For one, a parcel tax would require a two-thirds vote.

The UUT would be based on actual usage of utilities like water, electricity, phone, cable, cell, etc. Whereas the parcel tax is the same whether you have a $200,000 home or a $2 million home, the UUT is a percentage of actual bills.

Staff argues that it is “a durable tax that is more consistent than the city’s most significant general taxes. UUT inflates with time and it tracks with growth in consumption of the elements that are subject to the tax. It is less susceptible to economic downturns than property tax and sales tax, though it must be acknowledged that effective resource conservation may have some impact upon future consumption patterns. In a city such as Davis, which is largely built-out, a UUT would provide needed stability to the general fund budget.”

On the other hand, the council would have the ability under a parcel tax to delineate exactly how the tax is to be used. With a utility user tax, it is a general user tax and, therefore, the money would go into the general fund and could be spent on anything.

Right now, the city is looking at the state average of 5.5 percent, raising approximately $5.3 million annually.

That amount combined with the $4 million that the city is currently spending should give us enough to fund road repairs and may give us enough to maintain other existing infrastructure. The city should not rely on state money for road repairs, regardless of whether or not funding actually passes.

For one thing, a $1.1 million funding package is only a small supplement to what we need. A $3 million package would be more substantial but it seems extremely unlikely. Time to move forward with the best possible local plan, and, while I have doubts about a Utility User Tax – the city needs something.

—David M. Greenwald reporting

Share:

About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

Related posts

11 thoughts on “Commentary: State Transportation Package a Reminder of How We Got in this Mess”

  1. Nancy Price

    My question is: What have our City Council members been doing to support road maintenance funding over at the legislature? Have they been over lobbying? Has the City Manager? Has our Mayor organized with other Mayors to lobby the legislature?

     

    If not why not? If so, let’s have  report of what has been done.

     

     

    1. hpierce

      Kinda’ a dumb question, IMO.  Thru LCC, County associations, professional (Contractor & Engineer) associations, there has been much lobbying.  Davis should do it separately as well?  And we should spend how much staff time and effort to get that report on its efforts to you? At what “Price”?

          1. David Greenwald Post author

            Unfortunately I think the unanonymous are just as apt to throw the barb. Don Shor does as good a job as he can to clean stuff up.

  2. Miwok

    about $3 million annually

    package could have bolstered funding the City of Davis could use for road maintenance by $3 million annually

    Back in 2013, we ran a data analysis on where the city received the bulk of its funding for pavement contracts 2000 through 2012. During that time, the city only used $577,862 from local general funds. It received $1.86 million from State Transportation Funds, $5.5 million from Federal/State Highway funds, $1.37 million from Prop 1B, and $1.3 million from the stimulus package.
    In short, over 12 fiscal years ending in 2011-12, the city spent $10.6 million, and just over $10 million came from the state and federal government.

    This is the problem with too many numbers. If the first is true, then Davis spends $3M annually
    If the last is true, Davis spends $50K annually. The Press release just contradicted itself. Davis has also claimed to earmark $4M for next years roads (in a previous article) but this article contradicts that, unless the CC went from mere staff functions to actual work being done in the last couple years. I read in the Vanguard that Davis has spent more restriping lanes (5th St and the B St) than fixing roads?
    I think Davis has an advocate in the State Senate, but we do not hear her name?

    1. David Greenwald Post author

      The city currently allocates $4 million, $3 million of it from the General Fund. The need is at least $7 million, perhaps higher. The money for restriping the roads came from grants and road impact fees.

  3. Dan Carson

    To partly answer Nancy’s question, the council adopted a resolution at its August 25 meeting calling for state legislative action to help fix our roads.  I testified in support of this action before council.  I know city staff has been in regular communication about this issue with the League of California Cities. A link to the city staff report on the item can be found below.

    http://documents.cityofdavis.org/Media/Default/Documents/PDF/CityCouncil/CouncilMeetings/Agendas/20150825/04B-State-and-Local-Transportation-Infrastructure.pdf

  4. Gunrocik

    [moderator] edited

    We have a massive challenge on our hands — if we want to fix this mess, we have to do it ourselves — and we can only do it if we stop thinking someone else is going to bail us out.  And we can’t proclaim “Mission Accomplished” just because we have a short term increase in our revenues.

    It will be a long difficult “road” to attack our funding deficit.

    It will require sacrifices, trade offs, and god forbid-revenue enhancements to fix our problem.  
    [moderator] edited. No more personal attacks on other Vanguard participants.

  5. Dan Carson

    The first part of Gunrocik’s comments, about the need for local action to solve our infrastructure problems, and the certainty that it will involve sacrifices and trade-offs, is quite sensible.  It makes it all the more appalling that he then goes on to repeat the same old unfounded personal attacks on me and my former employer.  Whether his latter comments are out of ignorance or malice, I can’t tell you, because as usual he cowers in the shadows of anonymity.  I’m willing to stand up in public for what I say and I believe. Gunlocik won’t, and you should judge his bromides accordingly.

Leave a Reply

X Close

Newsletter Sign-Up

X Close

Monthly Subscriber Sign-Up

Enter the maximum amount you want to pay each month
$ USD
Sign up for