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Backseat drivers

Governor invites help to find funding for highways

The search begins again.

Gov. Asa Hutchinson last week created a working group to recommend a way to get more money for state highways.

This particular search has been repeated so many times, you've got to wonder where it can lead.

But Hutchinson promised another examination of what is a quite real funding challenge for the state Department of Highways and Transportation.

The governor signed an executive order last week creating a 20-member panel, which will be made up of state highway officials, business representatives, legislators, education leaders and others.

Their challenge is to address the gap between available funding and state road needs. Highway officials say they have more than $20 billion in needs identified for the next decade but will receive only $3.6 billion from both the state and federal government.

For the record, the comparison has long been out of balance. No one really expects any working group to come up with enough money to cover the gap. The real goal is (or ought to be) to reduce the gap by providing some additional revenue to roads.

There are a couple of problems at work in this situation, including uncertainty in how much federal revenue the state will receive.

Another prime motivator for these in-state calls for a different way to fund highway needs is based on a different problem. Today's vehicles, even the mammoth trucks that fill the roads, are more fuel-efficient.

That isn't a problem for those who benefit from the fuel efficiency or even those who like the idea of a more responsible planet. But it is a problem for the highway department.

Greater efficiency means vehicles need fewer gallons of gasoline or diesel fuel to operate, which provides fewer tax dollars for highways. Those taxes are pennies per gallon, a figure that doesn't change even as fuel prices ratchet up and down.

It is a dedicated revenue stream that has served the state well in the past but isn't sufficient any more.

"We've got to look at the different funding of models across the United States in the fuel-efficient car world," Hutchinson said last week after a speech to the Arkansas Trucking Association.

"I want to make sure I get an understanding of our current revenue stream and the needs that are there."

He had earlier told the truckers highway funding must be re-examined in Arkansas.

The truckers in Hutchinson's audience that day have an obvious interest in this issue because any proposed revenue source would presumably impact their bottom lines.

The rest of us have an interest, too, particularly if this revenue search leads where the last effort did.

Legislation was introduced in this year's session to transfer what has been general-fund tax revenue from automotive-related items to highways. The shift was to have happened over a 10-year period, presumably to allow the state to adapt to the general fund budget cut, estimated at $548 million once it was completed.

Gov. Hutchinson, like former Gov. Mike Beebe before him, rejected that notion at the time, explaining that it would threaten his proposed budget.

Shifting to highways means shifting from something else, which is why the makeup of this working group is interesting.

We don't know all of the names yet, but Hutchinson will put the state highway director, a member of the Arkansas Highway Commission and lawmakers on the panel. But he'll add local officials, representatives of the state chamber of commerce and the Department of Higher Education to the administrative working group.

Note that local governments have much the same interest as the highway department in highway funding issues. Traditionally, cities and counties get their own slices of the revenue pie. Most of the money, 70 percent, typically goes to the state with 15 percent each going to the collective cities and counties for local streets and roads.

But local governments are also on the receiving end of state general revenues and might stand to lose, if those dollars are diverted.

Higher education's representation on the panel is particularly notable. Higher education, unlike public education, doesn't enjoy priority-funding status. It is an area of the budget that typically suffers in tight-money situations.

"We want to have it wide-ranging so those who are worried about our normal general revenue budget, that their voice is heard," Hutchinson said last week.

Then he added something more.

"Unless we get a consensus, we're not going to be able to change anything."

He has that right.

However, a true consensus may not be easily achieved in the working group, much less in the rest of the state.

Commentary on 05/03/2015

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