Photo credit: Bill Whittaker (CC-By-SA 3.0)
Editor’s note: This article is part of a two article series addressing the gas tax debate. Ann Trimble-Ray presents a case for a gas tax increase. Drew Klein, State Director of Americans for Prosperity-Iowa wrote a piece for Caffeinated Thoughts arguing against it. SVH
The street in front of my home in Early, Iowa, is deteriorating. In fact, there’s a 10 yard long section where grass grows through the cracked surface at such a rate a mower is the right tool for maintenance in the summer. In the past, entire streets would be seal coated annually, then it became select blocks, and the last couple of years, specific spots. Revenue is inadequate for maintenance much less any significant improvements.
The trajectory of street conditions in my hometown reflects what’s seen across Iowa as revenue for transportation infrastructure has failed to meet basic needs. How are the state, counties, and cities coping with the issue? On the state level, despite record funds available for construction last year, the impact of increased construction costs means fewer miles are built and projects programmed. Tragically, counties and cities are borrowing for transportation projects.
A report from the Iowa League of Cities reveals bonds, notes, and short-term loans accounted for about 23 percent of cities’ total revenues for street purposes in Fiscal Year 2013, totaling $200 million in debt for FY2013. Their report goes on to say city expenditures including both principal and interest on street debt for that year topped $262 million statewide.
The League’s report also said about 39 percent of Iowa cities have some outstanding debt for street purposes. Data they cite from the Iowa Treasurer of State Office says both the number of local governments issuing outstanding debt for transportation debt, and the total amount of related debt, has been increasing. In FY2013, there were 585 self-reported outstanding local debts related to transportation totaling $1.1 billion. (This is an increase of 148 percent over 2001.) Repayment of such debt falls completely on the shoulders of property tax payers. Not drivers.
Without an increase in transportation infrastructure revenue, this trend will only continue. A survey conducted by the Iowa State Association of Counties tells us there are 29 counties with transportation debt as well.
In both cases, the burden of inadequate transportation infrastructure revenue is hidden in plain sight. Property tax payers – not drivers – are shouldering huge debt which will only grow without a long-term, constitutionally protected road/bridge construction revenue plan implemented immediately. The unfairness of placing the responsibility on property tax payers cannot be overstated.
Property tax payers have no choice – they are obligated to contribute to retiring transportation debt. Too often the project they pay for has a useful life which is shorter than the term of the bonds. Conversely, we all can control the gallons of fuel we consume through adjusting miles driven and miles per gallon of our vehicles.
As the legislature considers possible solutions, I encourage those who oppose any type of tax increase to realize inaction has resulted in exactly that already. Iowa property tax owners have been penalized and forced to bear costs that should have come from those who use the transportation network regardless of the state of their primary residence.
Other burdensome costs come from increased vehicle maintenance due to poor road conditions. The cost for Iowans is estimated to be $421 annually per www.infrastructurereportcard.org/states. Again, costs to the driver are hidden in plain sight. Consider this: Iowa State University Associate Scientist in Economics David Swenson estimates a 10 cent per gallon user fee increase on fuel would cost the average Iowans $80 per year (20,000 miles per year at 25 miles per gallon).
As a conservative, I abhor waste, fraud, and tax increases. However, as a property tax payer, proud Iowan, and driver, I realize we cannot maintain what we have, increase capacity, or improve safety if we do not address this issue and find ways to increase revenue. What will the future of Iowa look like as more miles of gravel roads are closed or moved to minimum maintenance status, bridges closed, and construction projects scrapped?
We have an obligation as citizens to invest in the infrastructure which supports and drives our economy. I believe Iowans, and those from out-of-state who purchase fuel here, should pay for the transportation facilities we use.