Donald Fry: Brainstorming in search of transportation funding consensus

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By Donald C. Fry

There is no shortage of ideas percolating in Annapolis these days on how to address Maryland’s transportation infrastructure funding crisis.

Last month Senate President Mike Miller proposed a sales tax on gasoline and the creation of regional authorities to raise transportation revenue. Meanwhile, at the Greater Baltimore Committee’s annual Legislative Forum on January 28, Governor Martin O’Malley’s chief of staff pledged administration support for whatever is needed, including a funding lock box, and two prominent lawmakers brainstormed potential solutions.

Here’s a thumbnail summary of perspectives and ideas voiced by lawmakers relating to strengthening Maryland’s chronically stagnant revenue stream without increasing the state’s per-gallon gas tax, an approach that lawmakers have consistently signaled would be challenging to pass in the State House, particularly in the House of Delegates.

Senate President Miller (D-Prince George’s and Calvert) says he will propose a 3 percent statewide sales tax on the wholesale price of gas. He also suggests creating regional transportation authorities to give county elected officials the option of enacting some form of local taxes to pay for transit projects.

Also, Miller has suggested leasing the Intercounty Connector to a private company to raise funding for transit projects such as the Red Line in Baltimore and the Purple Line in Montgomery and Prince George’s County.

As of the end of last week, Miller had not introduced specific legislation incorporating these proposals, but is expected to file legislation within a week, perhaps as soon as Monday.

Meanwhile, speaking to GBC members last Monday, the governor’s Chief of Staff Matt Gallagher acknowledged that the state’s stagnant funding for transportation infrastructure remains one of Maryland’s most pressing fiscal challenges.

“We will do whatever we need to do” to bolster funding for the state’s Transportation Trust Fund and to restore trust in it, Gallagher pledged. “If that means a lock box, if that means constitutional amendments, the administration is very willing and able to engage on those issues.”

Having had lawmakers swat down his transportation proposal last year, Governor O’Malley is clearly waiting this year for General Assembly leaders to take the initiative in developing legislation to work on. Although he did not himself propose a transportation funding solution, the governor did chide lawmakers during his State of the State speech on Wednesday to take action to better fund transportation infrastructure.

“There is no reason we should be content with having the worst traffic congestion in the country,” he told lawmakers.

House Speaker Michael Busch (D-Anne Arundel) has not proposed a transportation funding measure, but has repeatedly expressed a willingness to engage in discussions toward crafting a funding solution for which he can get a 71-vote majority in his chamber.

House Minority Leader Anthony O’Donnell says a major impediment to crafting a solution to the state’s current transportation funding crisis is disenchantment in rural counties over an increasing “imbalance” of transportation revenues that go toward transit rather than roads and bridges.

“Mass transit is eating our Transportation Trust Fund dollar,” he says, noting that the “vast majority” of state revenue to the fund comes from highway users in the form of gas taxes, vehicle titling fees, car registration fees and other MVA fees.

To address the transportation funding impasse, O’Donnell (R-St. Mary’s and Calvert) proposes enacting a trust fund lock box, “rebalancing” the use of funding between roads and transit and increasing fare box recovery from transit users. He also proposes delaying construction of the Red Line and the Purple Line until the state’s economy improves more.

Maryland has transportation funding challenges, but “we’re not on the verge of having the system collapse,” says Senator Richard S. Madaleno, Jr. “We’re on the verge of being in a place where our revenues can only maintain the system we have.”

He acknowledges Miller’s proposal, but does not endorse it. “That might not be the best idea, but we’re going to have a conversation about how to move forward,” Madaleno (D-Montgomery) told GBC members, adding that the state at least needs to begin indexing the gas tax to inflation.

He suggested considering increasing the state sales tax, dedicating the increased portion to transit, and leaving the rest of the Transportation Trust Fund for roads, other transportation modes and Maryland Department of Transportation capital needs.

Three other proposals have recently been introduced in the Maryland General Assembly. Two separate bills, filed by Delegate Brian J. Feldman (D-Montgomery) and Senator David R. Brinkley (R-Carroll and Frederick), propose constitutional amendments that would prohibit the transfer of state Transportation Trust Fund proceeds to the General Fund, among other things. Senator Ronald N. Young (D-Washington and Frederick) has filed a bill that would allow counties and municipalities to enact local sales taxes on fuel of up to 2 percent to finance local road and transit projects.

Does all of this brainstorming in Annapolis about transportation funding mean that we can expect a legislative proposal to emerge for strengthening the state’s stagnant funding for transportation infrastructure that could actually pass the General Assembly this session?

Not quite. It’s too early for transportation advocates to get excited over that prospect. Many of the ideas being floated have been proposed before without having gained traction.

But it’s intriguing that lawmakers this year appear to more seriously acknowledge key impediments to transportation funding progress. Foremost among these are the issues of better balancing funding for transit and for roads and the potential need for a lock box or other mechanism to ensure that transportation revenue is used for transportation purposes.

There’s one point on which most agree. With next year being an election year – when state lawmakers tend to shy away from enacting measures to increase revenue – this session is the year to act on transportation funding if a consensus can be achieved.

The question remains: is there a genuine window of opportunity and is consensus within reach?

Donald C. Fry is president and CEO of the Greater Baltimore Committee. He is a regular contributor to Center Maryland.

Recent Center Maryland columns by Donald C. Fry:

It’s complicated, but gas pipeline replacement proposal worth a look

Proposed budget frames state’s fiscal contrasts

Transportation funding: will it be a genuine priority in Annapolis this year?

As deficit pressure eases, what will state lawmakers focus on?

Competitiveness should be at the top of lawmakers’ priority lists

Community spirit: it’s alive and well in Baltimore’s business sector

Two agencies offer roadmap to competitiveness

State funding for new roads approaching zero
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Donald C. Fry has been the president and CEO of the Greater Baltimore Committee (GBC), the central Maryland region's most prominent organization of business and civic leaders, since November 2002.

Under Don’s leadership, the GBC is recognized as a knowledgeable and highly credible business voice in the Baltimore region, Annapolis and Washington, D.C. on policy issues and competitive challenges facing Maryland. Its mission is to apply private-sector leadership to strengthening the business climate and quality of life in the region and state.

Fry served as GBC executive vice president from 1999 to 2002. From 1980 to 1999 Fry was engaged in a private law practice in Harford County. During this time he also served in the Maryland General Assembly. He is one of only a handful of legislators to have served on each of the major budget committees of the General Assembly.

Serving in the Senate of Maryland from 1997 to 1998, Fry was a member of the Budget and Taxation Committee. As a member of the House of Delegates from 1991 to 1997 Fry served on the Ways and Means Committee and on the Appropriations Committee.

Fry is a 1979 graduate of the University of Baltimore School of Law. He earned a B.S. in political science from Frostburg State College.