The General Assembly has voted for highway user fee surcharges to support a new Rhode Island Highway Maintenance Trust Fund. It will be devoted to providing the state matching funds for federal-aid transportation projects, in place of borrowing.
The new special fund is intended to end the half-century practice of borrowing money to pay the State's share of projects. In recent years, Rhode Island has been borrowing $40 million annually for this purpose, and the annual debt payments on these bonds have grown to $46 million. If borrowing were to continue at the same pace for another 10 years, debt service would grow to more than $70 million.
The new "Rhode Island Highway Maintenance Trust Fund" is created in Article 22 of the state budget for the fiscal year beginning July 1. However, it will be two years before the State begins to collect the surcharges. No official estimate was immediately available as to the amount going into the new trust fund. It will probably be at least $25 million annually when the surcharges are fully phased-in during the fiscal year beginning July 1, 2016.
Additional help in reducing bond needs beginning July 1, 2013, would come through a Capital Budget item, setting aside $20 million in each of three years for a "DOT-Highway Projects Match Plan."
Surcharges on registration and license fees. The State will begin to collect the $30 registration fee surcharge on autos and light trucks on July 1, 2013, and it will be phased-in over a three-year period at $10 per year. On cars and trucks subject to annual registration, the surcharge will be $15, and also will be phased-in over the same three-year period at $5 per year.
There is also a provision for a surcharge of $30 per operator's license, which is paid every five years by each licensed operator of a motor vehicle. This surcharge will also be phased-in at $10 per year commencing with the fiscal year beginning on July 1, 2013.
Highway Maintenance is defined as "the upkeep, maintenance, and repair of the state's highways, roads and bridges, including repaving or resurfacing the same, but does not mean the planning or construction of new highways or bridges." However, a floor amendment presented by Rep. Helio Melo, House Finance Committee Chairman, specifically directs that monies going into the highway maintenance fund "shall be allocated through the transportation improvement program process to provide the state match for federal transportation funds, in place of borrowing, as approved by the State Planning Council."
Change from Governor Chafee's Original Proposal. As submitted by the Governor, Article 22 would also have created a fund devoted to eliminating the need for bonding of matching funds. The main difference from the plan adopted by the Assembly is that the Chafee plan would have been financed by transferring existing registration and license fee revenue to a new Intermodal Surface Transportation Fund, instead of from new surcharges. The Chafee plan also would have provided a gradual buildup of annual appropriations for the fund, beginning this year, reaching a total of $60 million within five years.
Senate Bill 0148 & House Bill 5789. Promoted by public transit advocates, these bills called for increasing vehicle registration fees by $40. 50% of proceeds would go to RIDOT to be used for highway and bridge maintenance or for "commuter rail operations”. 35% would go to RIPTA operations. The remaining 15% would go to cities and towns for highway maintenance. CIRI objected to the commuter rail inclusion when public hearings were held on these bills in the House and Senate. Neither bill was approved by the Assembly.
Toll study article fails. Normally, the General Assembly approves requests to create study commissions. However, the House Finance Committee eliminated Article 34 from the proposed budget. This called for creation of a study commission to explore the introduction of tolls on I-95 and other locations. Failure to win passage of Article 34 does not prevent the Governor or the Department of Transportation from creating a study commission for the same purpose.