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Utah's new tax shortage
Figuring out how to manage government funding in a rotten economy could easily be compared to lining up boxes of dominoes only to have them keep falling over before you're done.
The latest domino to topple is the federal Highway Trust Fund, which according to the Bush administration is expected to run a $5 billion deficit next year. That's because gasoline and diesel fuel prices have skyrocketed and Americans are driving fewer miles in an effort to save money. Because fuel taxes are collected per gallon purchased, tax revenues are plummeting -- Americans have driven 40 billion fewer miles in 2008 compared to 2007, a reduction of 3.7 percent.
And Utahns' miles driven are down even more than that: 4.4 percent this May under May 2007, or nearly 100 million miles collectively. Which means -- ta-da! -- Utah's transportation tax revenues are off steeply, too.
It's further confirmation of what we reported in this space on July 1: The Utah Department of Transportation says revenues from the state's fuel taxes will take a hit of at least $11 million, and perhaps as much as $20 million. That means budgets will have to be remade and funds for new construction and significant rebuilding may have to be diverted to maintenance projects like resurfacing roads, filling potholes and the like.
The thing is, because almost everyone believes the price of oil isn't coming back down significantly, the trend will be for Utahns and Americans to drive fewer miles and to replace gas-hog trucks and SUVs with fuel-efficient automobiles. That means the number of gallons of gas and diesel purchased over the long haul will continue to be down and the state and federal government will have to decide on a few very important matters:
* Will fuel taxes need to be raised? And if so, by how much?
* Should we keep funneling the same proportion of dollars into new roads? Or should we be tipping the scales toward mass transit: commuter rail, streetcars, buses, TRAX lines and bus-rapid-transit?
UDOT reported recently that 6,000 fewer cars are on Interstate 15 each day since FrontRunner service began. If UTA service is made even more plentiful and convenient for Utahns, it stands to reason even more cars will be removed from roads.
Then again, new roads can be an enormous relief: Those of us in the Top of Utah are looking forward to the autumn opening of the Legacy Parkway, which should lessen I-15 congestion even more during the morning and evening rushes.
While Utah depends on a lot of federal highway dollars to help with maintenance, and has in the past been the beneficiary of massive federal subsidies for mass transit, the Beehive State also spends a considerable amount of its own tax dollars on highways and transit. The diminished driving by Utahns will mean that state officials will have to become more creative and careful about how they collect and spend these taxes.
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I don't know where you got your figures but on the UDOT site you can see for yourself that from March to May of 08 traffic INCREASED 153 cars per day. FrontRunner made NO difference. We just WASTED 700 million dollars! I hope Legacy works, my wallet is empty.
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