Seven months into a study on highway finance, no one has come up with a magic new way to pay for state highway improvements.
The Arkansas Blue Ribbon Committee on Highway Finance, which began its work in May, hopes to have recommendations ready by mid-2010.
But the trial balloon it floated recently - for a sales tax revenue shift from the general fund to highways - ran smack into strong opposition from Gov. Mike Beebe.
A spokesman for the governor said flatly that a proposed $425 million annual hit to general revenue “is not something we can consider.”
A subcommittee of the blue ribbon panel had suggested moving that amount of money to highway construction, offering to phase in the change over four years to ease the blow to general revenue.
Notably, the $425 million figure is more than twice what the committee was supposedly looking for in new annual revenue for highways. It may have been offered not so much with the expectation of getting that much money as to provide some bargaining room to get closer to the $200 million goal originally discussed.
Any amount of new money would help.
But the firm “no” from Beebe’s office to a tax shift should have been expected.
This idea of robbing the general fund to pay for highways has been offered up with considerablefrequency in recent years. It is always linked to the logic of taking sales taxes paid on new and used vehicles and other transportation-related sales (like repairs, parts, batteries, tires, etc.) because the people paying those particular sales taxes are highway users.
Most often, the idea has come directly from the Arkansas Highway Commission or through Highway and Transportation Department officials, who are seriously challenged to meet highway needs with the existing revenue stream.
They eye the sales tax because its collection doesn’t drop when people drive fewer miles or choose more fuel-efficient vehicles, as drivers have been doing for years now.
Rising fuel prices have forced behavioral changes and the result has been flat-lined revenue for highways. Most of the dedicated revenue comes from per-gallon fuel taxes.
The old funding path is, admittedly, a dead-end road.
But more creative options haven’t been any more popularthan this idea of shifting general revenue to highways.
It’s a most difficult task that’s been given to the Blue Ribbon Committee, which seems to be following the same line of thought as others who’ve looked to tap general revenue for highway funding.
They will learn, as other advocates have, that opposition to that idea is steadfast because the money can’t be easily replaced.
Anything shifted to highways won’t be there to pay for other aspects of state government supported by general revenue.
Think it is hard to raise money for highways? Try finding new revenue to build prisons. Those certainly can’t be supported by “user” fees or taxes targeted to the inmate population.
The same is true of a lot of other state government functions.
They’re necessary but not particularly popular.
By far the largest part of every general revenue dollar goes, however, to education. Education is a popular cause, more popular than highways, and protected now by state law that makes it the state’s priority. Period.
No one’s going to mess with education funding, especially not on Gov. Beebe’s watch.
So, as the Blue Ribbon Committee continues its work, it sure needs to find some other, more realistic option to put on the table. Raiding the general fund just does not seem doable.
BRENDA BLAGG IS A COLUMNIST FOR NORTHWEST ARKANSAS NEWSPAPERS.
Opinion, Pages 5 on 12/30/2009