Date:
To: All Employees
From: Arthur Walker, II
The following correspondence was
prepared by the Kentucky Association of Highway Contractors (KAHC). It
expresses the importance of House Bill 664 and can be used as a model for contacting
our legislators and impressing upon them support of this legislation.
Additionally, you will find contact information at the conclusion of this
correspondence. I encourage you to write, phone or e-mail your State
Representative and let them know your opinion of HB 664.
The highway to
Say Yes to HB 664
Dear
The above caption is a terrible
announcement but it's the truth. The future of
Road Fund revenues have been growing at a
rate that is less than inflation and lag behind the rate of growth in the
General Fund.
Pavement conditions of all rural/secondary
roads, state maintained highways, interstates and parkways are deteriorating at
a rate faster than current funding will allow them to be maintained.
Many of the
The Highway Fund Cash Reserve has been
depleted during the past four years to a point that
State project work contains language limiting the
amount of work that a contractor can be paid on a monthly basis. The annual
resurfacing project contracts contain language limiting the amount of work that
can be paid for in 2004 to only 50% by December 2004 with the balance of the
work to be paid for in March 2005. The alternative for the contractor is to
delay doing the work until the spring of 2005 and the get paid by June 2005.
This means needed 2004 work could be delayed until 2005. The alternative is for
the contractor to finance the 2004 work requiring higher prices for work done.
The recently released 2005 to 2010 Six Year
Highway plan did not contain any new state projects due to lack of funds for
currently listed projects. $1.3 billion of 2005 and 2006 projects will be
stretched further into following years.
Only
1 out of 8 projects listed in the 2005 and 2006 Six Year Plan have a realistic
chance of being let for work in the next two years. There is only $100 million
per year available for $1.5 billion of new projects listed for the next two
years. The projections for the following years of the plan forecast even less
funding. This means as a legislator you have a 13% chance of getting your
project let during the next two years and an even smaller chance in the future.
To do the above, normal funds from the State Match for Federal Projects was transferred to the State Construction Account. This means that the list of Federal Projects has been decreased by 20%. This resulted in the request to use Federal GARVEE (Grant Anticipation Revenue Vehicles) Bonds to meet the needs of the Federal Interstate work.
The highway contracting industry will have
to lay off workers due to the lack of project work. For every $100 million of
work, approximately 4,700 work positions are impacted. Some jobs are directly
related while others such as service work, material suppliers, the insurance
and banking industry are secondarily impacted.
If
you say NO to HB 664 you are saying
No
to economic development for
No to solving
the many safety hazards on our highways and bridges that have resulted in
No
to improving driving conditions for motorists
But most of all, you are saying NO
to
Now is the time to say YES to HB
664!
Adrian Arnold (Montgomery, Powell,
Wolfe)
Home Phone: (859) 498-3074
E-mail: Adrian.Amold@lrc.state.ky.us
Rocky Adkins (Boyd, Elliott,
Home Phone: (606) 738-4242
Office Phone: (606) 928-3433
E-mail: rocky.Adkins@lrc.state.ky.us
Joe Barrows (Fayette, Franklin,
Woodford)
Home Phone: (859) 873-9768
Office Phone: (859) 873-9768
E-mail: joe.barrows@lrc.state.ky.us
Carolyn Belcher (
Home Phone: (606) 674-3280
Office Phone: (606) 674-243.7
E-mail: carolyn.belcher@lrc.state.ky.ns
Don Pasley
(Clark,
Home Phone: (859) 842-3337
(859) 749-2976
E-mail: don.pasley@lrc.state.ky.us
John Will Stacy (Menifee, Morgan,
Rowan, Wolfe)
Home Phone (606) 743-1516
Office Phone (606) 743-7046
Kentucky General Assembly, Legislative
Message Line
800-372-7181
HB 664 Will Improve Highway Safety and
Economic
"These are user fees we are
proposing -- not taxes. Unlike taxes, only those using the system pay the fees.
A safe and reliable transportation system is vital to
Rep. Jim Callahan
Basic Provisions of FIR 664
HB 664 would increase the state's motor
fuels nser fee by 4 cents annually over the next two
years for a total of 8 cents. This would bring
The bill would raise the automobile and
pickup registration fee from $15 to $26.50 and raise the four-year driver's
license fee from $8 to $16. The bill would also transfer to the Road Fund one
cent of the 1.4 cents going to the underground storage tank remediation fund.
The bill would continue revenue sharing
of the motor fuels user fee at the current percentages: Municipal Aid - 7.7%
County Road Aid - 18.3%
Rural & Rural Secondary - 22.2%
Reflecting the greater urbanization of
the state and to provide more equity for urban areas, the new revenue
for the County Road Aid and Rural Secondary programs would be distributed on
the basis of population. Every county will be getting more funding, but
counties will be getting back more of what their citizens contribute. (An
estimate of your county's share of CRA and RRS with the proposed 8 cents
increase is available from KBT,)
When fully
implemented, the bill would raise some $308 million in new revenue with
$186.7 million of this going to the State Road Fund and $118.2 million going
for revenue sharing. The motor fuels use fee should bring in about $270 million
of the new revenue, increased registration fees about $32 million and driver's
license fees about $6.6 million. Counties get a 30 percent share of truck
registration fees making their share of the increased pickup registration fees
nearly $3 million.
Fees Compared to
The last time there was an increase in
the motor fuels user fee for roads and highways was 1986. A 10 cent per gallon
increase -- based on the CPI -- would regain 1986 purchasing power. The last
time the automobile registration fee was raised for the Road Fund was 1968.
Today, it takes nearly $60 to buy what $11 did in 1968.
Without Additional Revenue, Only 13 %
of SP Projects Will Be Funded
The FY 2005-2010 Six-Year Highway Plan,
as presented to the General Assembly, dearly spells out funds will be available
to let only $200 million in SP projects (100 percent state funded) during the
biennium against $1.522 billion in SP projects scheduled in the plan for the
biennium. (Under the Cabinet's "cash flow" operating procedure, $95
million will leverage $200 million in work let to contract.)
This, of course, means 87 percent of
projects scheduled for FY 05-06 aren't going anywhere unless there is
additional revenue. And, the situation doesn't get better. According to the
plan document, it will be possible to let only $460 million in SP projects
during the life of the Six-Year Plan. In all, there are $1.913 billion in SP
projects in the plan.
Under the Governor's proposed budget,
federal projects will also feel the bite of inadequate funds.
The Governor's recommendation to use toll road credits (with no cash value) to
"match" federal funds, in effect, means the federal aid construction
program is reduced by 20 percent. (This will be partially offset through the
issuance of GARVEE bonds.)
Without additional revenue, projects
for improved safety, increased travel efficiency, and, in many cases, economic
development all across the state will be stopped or postponed.
These needs -- identified by local
officials, together with regional and state planners -- include reconstruction
and widening of highways, new connectors, and other facilities.
Most of these facilities are needed
over the near term to save lives and continue economic growth. However, at
projected investment levels of approximately $750 million to $800 million
annually, it will take more than 60 years to address the needs.
deterioration
or because they no longer meet current design standards.
Driving on roads in need of repair
costs
Economic Benefits of HB 664
General --
An U. S. Department of Transportation study projects that every dollar invested
in the nations highways system yields $5.70 in economic benefits because of
reduced delays, improved safety, and reduced vehicle operation costs. When
fully implemented, the revenue enhancement measures in HB 6~
;4 are estimated to provide an additional $300 million annually in
highway investment. Based on the USDOT study, this $300 million investment
would result in some $1.7 billion in economic benefits for the public.
Jobs "I The spend-down of the cash balance
by the Transportation Cabinet means that about $200 million
less
annually will be let to contract during the biennium than in past years.
Economists recognize that $100 million in highway construction investment
creates 4,200 direct, indirect, and induced jobs. Therefore, it is reasonable to
assume the annual cutback of $200 million spending in the state construction
program -- if not replaced -- will result in the loss of upwards of some 8,400
jobs and the income and sates tax revenue that would result from the flow of
the $200 million through the economy. While all of this economic loss will not
accrue to the
Kentuckians
for Better Transportation
Telephone:
(502) 491-56000 E-marl: jackkbt@msn.com