Breaking a bad habit

Our view: Dipping into the state transportation fund is a tough addiction to quit

February 22, 2010

The plethora of pot holes emerging from Maryland roads this winter is not the result of the weight of the recent snow or the damage done by plows. Rather, it is the pernicious freeze-and-thaw cycle fueled by so much standing snow that gradually turns concrete to rubble.

What an apt metaphor for how Maryland's elected officials have treated the state's transportation finances. The Transportation Trust Fund is set up to be a consistent and independent source of money for the state's highways, bridges, public transit, ports and airports, shielded from the economic exigencies that so often make demands of the general fund.

But over the years, governors and lawmakers have tapped into the trust fund in times of fiscal challenge, to the point that there's not only far less "fund" but also less "trust" involved. By "borrowing" from the fund -- sometimes repaying it, sometimes not -- state officials have slowly eroded its integrity, just as surely as freezing water turns roads into a lunar landscape.

This year, the General Assembly has some choices to make in that regard. One House proposal seeks to impose a firewall between the Transportation Trust Fund and the state's general fund by requiring any governor to first declare the extraordinary circumstances required to justify a transportation fund withdrawal. If approved, the state would then be obligated to repay the fund within five years.

Those are certainly good intentions. The trust fund ought to be tapped only when basic services are threatened and there's no reasonable alternative (if the choice is between say, a new road and underwriting infant nutrition). But the problem is that future legislatures are not bound by any such law. They can just as easily rewrite it next week, next month or next year.

Indeed, it's not unlike a dieter who chooses to padlock the refrigerator. He or she still has the key. Inconvenienced? Perhaps. But deterred? Not really. If lawmakers want to restore some integrity to the fund, their first step ought to be to reject another proposal -- a recommendation from the Department of Legislative Services to reduce the amount of sales tax revenue directed into the fund each year.

That sales tax revenue -- made possible when the legislature approved the penny increase in the sales tax three years ago -- was a major boost to the trust fund. But it was subsequently reduced by 18 percent on a temporary basis to fill the fiscal hole created when lawmakers killed the tax on computer services. Should legislators accept the DLS recommendation and make that diversion permanent, the trust fund would lose an estimated $60 million a year. As the fund is already inadequate to meet the state's transportation needs, that would be disastrous.

Maryland needs to invest more in transportation. The Baltimore-Washington corridor continues to have some of the longest commuting times in the country, and the regional economy could suffer for it. Transit alternatives ranging from Baltimore's Red Line to an expanded MARC commuter rail system are vital, but the state lacks the money to pursue these multibillion-dollar projects.

Whoever is elected governor this year will need to confront this dilemma. One can only hope that whatever revenue source is proposed -- higher gas taxes, fees or a greater share of the sales tax -- the state can be trusted to invest transportation-related taxes for a transportation-related purpose.

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