Dwindling State & Federal Funding Presages More Transportation Tax, Wolfe Says

The San Bernardino County Transportation Agency’s Business 2 Business Expo held at the Ontario Convention Center on September 29 resulted in a couple of revelations that were quite noteworthy if not outright shocking.
The agency’s executive director, Ray Wolfe, told those assembled during his “State of Transportation” address that not only the San Bernardino County Transportation Agency but the California Department of Transportation are now impoverished, apparently because of rising gas prices and the progressive conversion of vehicles to electric power, which is decreasing gasoline sales in the Golden State, and thus reducing gasoline tax revenue. This struck a dissonant chord with many of those listening, as Californians are currently paying nearly $2 more per gallon for gasoline than consumers/motorists in other states, primarily because of the taxes the state government levies.
According to Wolfe, both the federal and state government are reducing the amount of money being provided to the California Department of Transportation, which is known by its acronym, Caltrans. California’s residents for generations have endured the highest gasoline prices in the nation, and have accepted that reality primarily because state officials have asserted that the cost of maintaining the 163,696-square mile state’s roads and highways necessitates those taxes. Despite that, Southern California’s freeway system has been inadequate for more than three generations, resulting in rush hour delays on weekdays. The region’s residents, primarily working commuters who transit to, from and between San Bernardino, Riverside, Orange, Los Angeles and Ventura counties during morning and late afternoon/early evening rush hours, typically spend more than three hours a day on the freeway.
In response, San Bernardino County’s voters in 1989 approved Measure I, a half-cent sales tax override, which was extended through to 2040 in another vote in 2004. Measure I was intended to produce revenue that was to be entirely devoted to transportation improvements. The county’s then-extant joint powers planning authority and council of governments,  San Bernardino Associated Governments, was tasked to serve as the county transportation agency and oversee the distribution and application of the Measure I funds. San Bernardino Associated Governments, known by its acronym SANBAG, in 2016 changed its name to the San Bernardino County Transportation Authority, which is known by its acronym SBCTA.
Though the politicians who sponsored Measure I offered assurances that the funding it would provide would cure the gap between the county’s transportation system improvement needs and the inadequate transportation infrastructure provided to the region by Caltrans, that has not proven to be the case. Immediately after Measure I was approved, the SANBAG board voted to borrow money against the promise of future Measure I revenue. This was done through the issuance of bonds, which were sold to bond purchasers. The proceeds from those bond sales were used to pay for a host of transportation projects undertaken by SANBAG. This allowed the politicians who had sponsored Measure I to make immediate claims that Measure I was fulfilling its promise of redressing the region’s transportation challenges. Nevertheless, in short order, the debt service on the issued bonds became a harsh reality that SANBAG had to deal with over the ensuing years. Right up to the present, SANBAG/SBCTA has found itself in the position of having to constantly make payments to those bond holders, using the incoming Measure I money. This means that a substantial portion of the transportation system augmentation tax county residents pay with every taxable purchase they make within the county is diverted to paying debt rather than funding new transportation improvement projects.
Moreover, the passage of Measure I encouraged the region’s politicians to approve ever more aggressive residential developments, which has contributed to a population increase that overburdens San Bernardino County’s transportation system.
Consequently, the ongoing SBCTA project being undertaken to widen the I-10 Freeway by two lanes in each direction, an improvement hundreds of thousands of San Bernardino County commuters welcome, will not be usable by the vast majority of those commuters, unless they are personally willing to pay usage fees for those lanes. Unbeknownst to most county residents, those four new lanes will be toll lanes. Despite the fact that the county’s residents are paying an added tax to provide local transportation improvements, the revenue from Measure I was not enough to pay for building those lanes, so SBCTA entered into a deal with a private company to assist in financing those lanes’ construction. Upon completion, the lanes are to be designated toll lanes, with the tolls going to the company involved in the financing of the project. Those unwilling to pay the toll will not get to use the lanes, even though the half cent per dollar they have been paying in taxes over the last nearly generation-and-a-half was committed to paying for projects such as the building of those lanes.
Part of Thursday’s Business 2 Business Expo/State of Transportation forum was devoted to “connect transportation officials with subcontractors for future teaming opportunities, enhance awareness of local labor, and educate prospective bidders on contracting opportunities.” The reality is that both Caltrans and SBCTA have historically worked with large corporations in building most of the region’s transportation infrastructure, meaning small companies have not been able to compete in the bidding process against the larger corporations. What Thursday’s proceedings were meant to accomplish was to signal that SBCTA is looking to offer smaller companies an opportunity to work on local transportation projects.
Some of what Wolfe said went beyond that or at least was interpreted as going beyond that, suggesting that SBCTA is looking for partnering with local and regional companies in future efforts to widen the region’s freeways by having them participate as recipients of future tolls when more lanes are built. This seemed to be an indication to the public at large that all additional lanes to be constructed on local freeways in the future will be toll lanes. For much of the public, which in large measure has yet to fully comprehend that the four new lanes on the I-10 Freeway that will open sometime in 2023 are to be toll lanes, this is an almost uncontemplatible concept.
Moreover, at one point, Wolfe, who is now claiming poverty and blaming the state and federal governments for the current and projected future funding shortfalls in the SBCTA budgets over the next decade-and-a-half, said SBCTA will have to look elsewhere, presumably beyond simply “partnering” with the private sector to fund “building the freeways.” He suggested serious consideration should be given to a further half-cent or maybe even full one-cent or one-and-a-half cent sales tax override to fill the transportation need gap which both Caltrans and the already-in-place Measure I funding and capital improvements/infrastructure provision regime are not adequately addressing.

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