Tuesday, October 28, 2008

No Crisis Can Pave Over Roadbuilders' Influence, Part 2

Continued from the previous posting:

All of this concern that $2 billion isn’t enough for roadbuilders must seem extremely misplaced to officials in higher education, like our university president Dr. Raines, who are making increasingly tough decisions because of state cuts to their budgets.

Our university presidents are making budget decisions that will decide which young people have opportunities for the future and which will not. Our university presidents are left with no decent options, and the end result will be abysmal for Tennessee – fewer students attending our public universities and fewer professors to teach them and many fewer numbers of poor students who will be able to pay hikes in tuition that are inevitable.

Already floated in Nashville as ideas for more funding for the roadbuilding industry is increasing the 21.4 cents per gallon state tax on gas or raising the current $24 state registration fee.

A Different Question

Here’s our question. If we are considering raising these taxes and fees, why can’t we consider other uses for them? Why should they automatically go to roads?

Here’s the context for all this: with its recent $4 million cut in state funding, the State of Tennessee has now cut its investment in the University of Memphis by $11 million, or 9%, in a couple of years. And rumors of more cuts are rumbling in Nashville.

The recent emergency cuts instituted by Governor Phil Bredesen call for higher education budgets to be slashed $43.7 million. It could not possibly come at a worst time for Memphis. Earlier this year, Portland economist Joe Cortright, speaking at Leadership Memphis’ community breakfast, said that the single most important indicator of whether a city will be successful in the future is its percentage of people with college degrees.

Stopping The Race To The Bottom

Unfortunately, Memphis languishes near the bottom of the list of the largest 50 metros, and Mr. Cortright said that if Memphis could move to the middle of this list, it would produce $3 billion in economic growth. The state of Tennessee, in its past funding and with the recent funding cuts, only makes that hill steeper to climb for our city.

How about the Legislature amending the law to give it the flexibility to divert money from the $1 billion in state gas tax revenues to maintain even more essential services like higher education until the state budget outlook improves? If the state gas tax and registration fees are to be increased, how about directing it to public universities like the University of Memphis whose success ripples throughout our city and defines our options for the future?

There is one glimmer of good news. Faced with the prospects of fewer roads to build, the roadbuilding industry seems willing to consider more seriously the possibility of state toll roads. As we’ve suggested before, State of Tennessee should start by putting up the toll gates – and taking down the I-269 signs – on the circumferential highway – Tennessee 385 - looping around Shelby County, yet another half billion dollar gift to the development industry.

Getting Green

Most of all, it’s past time for state government to give leadership to a more sustainable Tennessee. Rather than giving incentives to create more driving, state government should be investing and encouraging in more sustainable behavior by its citizens, and this should include emphasis on public transit, which for decades has received lip service and little money in discussions about transportation funding. In fact, if there’s any transportation that deserves a dedicated funding source, we’d suggest that public transit deserves it, not roadbuilders.

In a state legislature controlled by rural legislators, urban public transit is stereotyped as something for urban dwellers, largely those of a different race, and as a result, we lose opportunities for the kind of modern 21st century public transit system in Memphis that attracts more riders, improves our sustainability, and reduces our public bond debt.

If the special study committee members have consciences, they should encourage state government to make public transit a centerpiece for transportation planning and funding. There’s so much that Tennessee needs to be doing and investments that we need to be making to be competitive in the knowledge economy, and better public transit in our cities is a key one of them.

Getting The Priorities Right

Meanwhile, if state government wants to appoint special study committees, we’d recommend one that once and for all gets our state serious about higher education.

And if such a committee is appointed, we suggest that its review should begin back when State of Tennessee made the visionary decision to plug the gap in the state budget with the hundreds of millions of dollars of tobacco settlement money. Instead of doing something transformative – such as setting up something like an endowment to produce yearly funding for government innovation or investing in higher quality higher education or investing in transformative strategies, state officials simply put this unexpected massive funding into the state cash register.

It was the budgetary equivalent of eating your seed corn. Because of all this, there are long odds that state government or the new study committee will get it right this time. So far, there’s little reason to be optimistic.


Anonymous said...

I drove on 385 the other day for the first time ever. Wanted to see if it saved time, it didn't. There were at least 3 other cars on the road. Amazing.

Smart City Consulting said...

The argument that TN 385 AKA I-269 was needed to expedite truck traffic through Memphis makes no sense. No self-respecting trucker is going to drive 40 miles out of the way to swing around Shelby County instead of driving straight through Memphis on the only I-69 that we need. The justification for the other one, particularly through North Mississippi, was only to increase property values and development opportunities for politically connected contributors.

Anonymous said...

There are alternatives.


Midtowner said...

It's pretty simple ... if you allow the gas tax to be used for something other than roads (or transit) then you have the legislature raiding it for anything and everything.

It wouldn't be long before the roads were in really bad shape and the people would be wondering why the roads are so bad. The rest of the government can never get enough ... TennCare or the Universities or the K-12 would all be clamoring for the money and wouldn't give it up to repair roads without a bunch of whining.

So no, no, no ... don't divert the gas tax. If it becomes a problem of too money in the Road Fund, simply reduce the gas tax.

Smart City Consulting said...

midtowner: you are paying more and more taxes for the unsustainable lifestyle fed by more roads. We don't need new roads, and if we have to choose between declining universities and declining roads, it's an easy call.

There's just no reason that roads have a dedicated tax source that is sacrosanct.

Anonymous said...

Don't want your tax dollars wasted on more "unnecessary" roads? Don't like the influence of the road building lobby (or any lobby for that matter)? Don't want tax funds raided for "anything and everything?"

Please read and learn that there are alternatives. We should and need to start thinking very differently in this Country.


Need more? Ask anyone here to help explain http://mises.org/faculty.aspx

You could start with Professor Carden at Rhodes.

Anonymous said...

"Rhodes" no pun intended!