Neb. struggles with road costs

Neb. struggles with road costs

	Published : Mon, 31 Dec 2007 19:40 By : Agencies Print this Story

LINCOLN, Neb. (AP) - State lawmakers are about to enter a messy construction zone when it comes to paying for roads in the state.

It's littered with fiscal hazards: The state could get $80 million less from the federal government for road construction next fiscal year, and the state expects a $190 million shortfall for road construction by the end of the decade.

'In my opinion, doing nothing is not an option,' said Sen. Deb Fischer of Valentine, who heads the Transportation and Telecommunications Committee. The committee is expected to tackle the issue of road funding during the upcoming session, which begins Jan. 9, and Fischer has proposed a tax on wholesale fuel.

A pre-session survey of lawmakers by The Associated Press reveals there are many ideas -- and little agreement -- on what to do. Dipping into the state's large rainy day fund, hiking the fuel tax, siphoning dollars from other revenue streams, taxing ethanol, Fischer's sales tax on wholesale fuel transactions, making cuts in the Department of Roads -- the list of suggestions that could be considered is long.

Sorting through them is expected to be one of the Legislature's priority issues.

'We must address the issue,' said Sen. Tom Carlson of Holdrege, who suggested a sales tax on fuel that could lower the current per-gallon tax.

For years, the method of paying for roads -- primarily a per-gallon tax, which will be 23 cents beginning this month -- has been a badge of fiscal responsibility and reliability for state lawmakers. But it's beginning to fade.

Reasons include rising construction costs at the same time revenue from the state fuel tax is expected to remain flat. Information from the Department of Roads, for example, shows that inflation could help push the total cost of road construction in the state from almost $400 million in 2008 to about $500 million in 2011.

At the same time, revenue from the fuel tax is expected to remain flat, at less than $300 million per year.

That makes the current fuel tax 'mathematically incapable' of paying for road construction, Sen. Tony Fulton of Lincoln said recently. His plan includes using a portion of the motor vehicle tax for roads.

The money now goes mainly to schools, and he wants to increase state general fund payments to schools to allow for the change.

Some lawmakers think an entirely new revenue stream should be considered. One idea would have lawmakers handing out money as they drive to Lincoln: Sen. Cap Dierks of Ewing said toll roads should be considered.

Others think the right solution is to pick several items from the list of ideas.

'We need to have a mix of fees, taxes and general fund money,' said Sen. Russ Karpisek of Wilber.

Just one senator said the state should do nothing to make up for the expected shortfall from the federal government. Seven said taxes or fees should be raised, and three favored taking money from some other area of state government.

Twenty-three senators had a variety of other ideas.