Lawmakers to hear highway funding proposal
December 5, 2006
The blue-ribbon task force report on how to generate funding for Nevada highway projects will be forwarded to each member of the Legislature.
The Nevada Department of Transportation Board headed by Gov. Kenny Guinn received the blue ribbon study recommendations Tuesday but took no specific action on its recommendations. Guinn created the blue-ribbon panel to address a projected shortfall of $3.8 billion in highway construction funds by 2015.
Las Vegas businessman Phillip Peckman, chairman of the task force, said projected road construction needs total $11 billion by 2015.
“We are going to be, in terms of large projects and maintenance, broke by 2008,” he said. “We all think this is pretty urgent here. We’re in a crisis situation.”
His comments were backed up by an AAA Nevada report indicating 71 percent of motorists think more money is needed to maintain and improve roads. Michael Geeser, of AAA Nevada, said that group supports the task force recommendations presented Tuesday.
Peckman said the recommendations are designed to raise about $250 million more in revenue each year to cover the cost of bonds that will pay for the highway projects.
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“The revenue structure today will not do this,” he told the NDOT board.
But, Peckman said, after 12 task force meetings and numerous contacts with business leaders in the north and south, “there doesn’t seem to be any kind of a appetite anywhere to raise taxes.”
As a result, the major task force recommendations are primarily aimed at existing revenues. The group first backs Guinn’s recommendation that $170 million of the state’s general fund surplus be spent on road projects. Then it asks lawmakers to dedicate the state sales tax money generated by car and truck sales and repairs to highway projects – which would provide an estimated $170 million a year.
But that $170 million would come at the expense of other general fund needs in the state budget.
Despite the lack of enthusiasm for new taxes, Peckman said the task force included several increases including changing depreciation schedules which determine how quickly the annual registration fees drop as new cars age.
Slowing that rate of depreciation would only cost car owners a few dollars extra each year but would generate about $96 million in 2008 and more in future years.
Peckman said the task force also voted to recommend indexing state gas and diesel taxes to inflation. Under current law, the gas tax is a flat number of cents per gallon, which means revenues from that source aren’t keeping pace with inflation, he said.
And they called for adding $20 to the cost of a driver’s license, currently just $21.50.
Without those and other increases in highway revenues, he told NDOT board members Nevada will not be able to pay for planned expansions of Interstate 15 and Highway 95 in the south and Interstate 80 and Highway 395 in the north. Nor, he said, will NDOT be able to maintain the roads it now has.
Guinn agreed and recommended a copy of the task force recommendations be sent to each member of the 2008 Legislature as soon as possible.
• Contact reporter Geoff Dornan at email@example.com or 687-8750.