Wednesday, April 29, 2009

Fruit is Ripe, but...

... the market just won't support the picking.

Many times we refer to legislation as being like fruit, it's either ripe and ready to harvest (pass) or it's just "not ripe" (good idea, but not quite ready yet). We have a very different case this legislative session, the "fruit is ripe, but the economic conditions don't warrant or support the picking."

I believe most House members feel a good case has been made for more funding of some type to ensure proper maintenance and preservation of our transportation investment needs to be done. The issue, is and has been, that we are in a recession (close to depression) where raising taxes is just not a prudent move for the folks trying to make ends meet and recover. We must consider the residents of Idaho before we consider increasing funding state government with their money.

The House has respected each and every VETO the Governor has presented us on bills that we (both the House and Senate) thought were in the best interest of the State. We would expect the same respect for our votes, based on the input from our constituents on new gas taxes.

We all know that the need is there, we also know that our folks are telling us that now is just not the time. We have done our best to reflect the desires of the majority of the folks we represent, now it's time to finish the business of the State and quit spending the people's money for no reason other than political posturing. We see no reason to continue down a road with no end, as the Governor has spoken with his stamp, so has the House with their votes on fuel taxes. It's time to move on and consider alternatives.

We worked hard and long today to ensure we provided the Senate and the Governor with everything they need to wrap up this session. We have provided alternatives, some in the bills we've sent to the Senate that are either still pending or that we sent today for transportation. Does it reach the bar the Governor set? No, and we all know that... sometimes you just have to accept the fact that even though you believe the fruit is ripe, it just might not be a good season to pick.

The House has completed the work required for operation of the State during the worst economy since WWII. We believe spending anymore of the people's money to keep us here for taxes that we all just can't agree upon would be a waste of their hard earned money. We've decided it's time to move on instead of trying to pick fruit that just won't sell.

Your thoughts?

Wednesday, April 22, 2009

Highway Funding, is it a Critical Issue?

You be the judge... Current funding for 2010 for Idaho's Roads:

$508 Million (2009 spending authorization for 2009 was $492 million)
$297 million in unspent money from the Connecting Idaho Fund
$191 million in Federal "stimulus" money
$82 million additional bonding authority for GARVEE
$36 million in GARVEE cost savings from 2009
$18 million in additional funding through the elimination of the ethanol gas exemption
$17 million in discretionary "stimulus" funding

$1.250 Billion available to Idaho road managers in 2010 (almost twice what it had in 2009) for road projects and preservation and maintenance.

The budget provided to the House for ITD has road project funding that was twice that of preservation and maintenance, a 2:1 ratio of building over preserving.

Every penny of increase fuel taxes gains ~$4.4 million to the Highway Distribution Account (HDA), so the recent 6 cent increase amended by the Senate on the House bill to eliminate the ethanol exemption would have added an additional $26.4 million. The House voted down this amendment for a multitude of reasons, but mostly because we are in an economy where adding tax burdens on our citizens was just not appropriate.

While it appears we are more than flush with funding for ITD for the current budget year under consideration, it just would not be prudent to increase taxes on citizens already being taxed at a rate of being the 13th highest in the nation per capita.

We are already putting our tax Dollars in the state's "bank", they just aren't going to the correct accounts.

The state and local road managers have in excess of $300 million more than last year to address the state's transportation needs as outlined by the governor. The "stimulus funds" can also be used for preservation and maintenance, yet none of those funds were dedicated to that effort... why? Idahoans will see a record number of highway projects undertaken this year and into the next to address road maintenance and preservation needs, bridge repair and replacement as well as interstate congestion. Anyone indicating that the House has "done nothing to improve the current conditions" is just dead wrong.

Do we have a funding crisis for Idaho roads for 2010? You be the judge... let me know your thoughts.


Wednesday, April 1, 2009

A new way to pay for our roads?...

We have passed a bill out of the House that has the potential to add a very valuable tool to the State's toolbox of items available to them to pay for our infrastructure. Besides taxes and fees, we have the ability for ITD to "earn" some of the funds they need without competing with business. A reporter from the Lewiston Tribune seemed to be one of the first to understand the potential, he writes:

BOISE - Last November, about the time Congress switched from billion-dollar to trillion-dollar bailouts, one of the more intelligent government money-making operations in recent years came to an end.
That was when, with minimum fanfare, the last of the 50 state quarters hit the market.
I don't know who dreamed up that project, but it was one of those ideas that makes you smack your forehead and wonder why nobody thought of it earlier. It was brilliant in its simplicity: Produce 50 new quarters honoring each of the 50 states, roll them out over a 10-year period, then stand back as coin collectors go into a numismatic feeding frenzy.
Before the program began in 1999, the U.S. Mint produced about 1.5 billion quarters per year. Since then, according to the Congressional Budget Office, production has more than doubled, to an average of 3.5 billion per year - an increase worth about $350 million in annual net profits, or $3.5 billion over the life of the program.
The project was such a hit, the mint plans to follow it up this year with quarters honoring the District of Columbia and five American territories (Puerto Rico, Guam, American Samoa, the U.S. Virgin Islands and the Northern Marianas Islands). A decade-long project featuring quarters for various national parks will begin in 2010.
That kind of aggressive pursuit of market opportunities isn't typical of state or federal governments - for good reason. One wouldn't want monopolistic taxing entities, for example, to be influenced by profit motives.
However, the state quarters project demonstrates capitalism and government can occasionally combine to benefit taxpayers.
Rep. Marv Hagedorn, R-Meridian, is hoping to create a similar opportunity for Idaho.
Hagedorn, 53, grew up on a farm near Moscow. His folks and a sister still live in the area. He graduated from Potlatch High School, but it was working for the Potlatch Corp. lumber mill that changed his life.
"That's what made me decide to join the Navy," he said. "I was working the line next to guys who were missing two or three fingers, and the highlight of the night was when we'd throw knots at each other. I told myself I had to go somewhere."
Hagedorn retired in 1994, after 20 years in the service. Now, during his second term in the Legislature, he's hoping to turn Idaho into the U.S. Mint of commercial truck license plates.
Unlike personal vehicles, commercial trucks and tractor-trailers can be licensed and registered in any state, regardless of where a company is based. That, to Hagedorn, creates a marketing opportunity. He introduced a bill earlier this session that would encourage trucking firms to register their fleets here.
"I've been working on this for a few years," he said. "My objective is to find a resource the state has that would help relieve the tax burden on citizens, without competing with private businesses - and this is a great opportunity."
Idaho already offers a permanent plate that doesn't require yearly registration renewals. For a company like Wal-Mart, which has more than 50,000 tractor-trailers, eliminating paperwork and the need to match specific trailers with specific renewal stickers represents a substantial cost-savings, Hagedorn said.
Idaho law, however, currently requires out-of-state truckers to pay sales tax on the price of the trailer before they can buy the permanent plate. That makes it cost-prohibitive.
Hagedorn's bill would remove the sales tax requirement. Moreover, it authorizes the creation of special "business logo" license plates - meaning Wal-Mart or UPS or any other company could design their own plates, complete with corporate logo and marketing slogan.
"Everyone is looking to save a buck," Hagedorn said. "We can make this simple for corporations and help save them money just by changing state law. It costs $3 to make a license plate, and we'd sell them for $112. There are 5.6 million semi-trailers in the United States. That's a $627 million market."
Add in Canadian trucks, he said, and the market potential climbs to $1 billion.
"Imagine if we get just 10 percent of that," Hagedorn said. "In the past, we've looked at taxpayers within our border (to generate state revenue). This could bring in revenue from outside the state. There are opportunities out there. We just need to find them."
Hagedorn's bill is scheduled for a floor vote in the House this morning. If approved, it will move on to the Senate.

House bill H226 is now awaiting scheduling to be heard in the Senate Transportation Committee. It went through the House State Affairs and Transportation and Defense Committees as well as the House floor with out a single "nay" vote. I believe this is a great tool and could bring in millions that could off-set taxes we now pay.

Your thoughts?