Call to Order and Roll Call
The first meeting of the Budget Review Subcommittee on Transportation of the Interim Joint Committee on Appropriations and Revenue was held on Thursday, June 26, 2014, at<MeetTime> 10:30 AM, in Room 131 of the Capitol Annex. Representative Leslie Combs, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator Jimmy Higdon, Co-Chair; Representative Leslie Combs, Co-Chair; Senators Ernie Harris, Ray S. Jones II, and R.J. Palmer II; Representatives Hubert Collins, Tim Couch, Jim Gooch Jr., Sal Santoro, John Short, and Jim Stewart III.
Guests: Representative Arnold Simpson; Russ Romine, Deputy Secretary, Transportation Cabinet; Tammy Branham, Executive Director, Office of Budget and Fiscal Management, Transportation Cabinet; Brent Cooper, Interim President, Northern Kentucky Chamber of Commerce; Chad Day, Executive Secretary, Greater Cincinnati Building Trades Council; and Sherry Carran, Mayor, City of Covington, KY.
LRC Staff: Chuck Truesdell, Jennifer Anglin, and Spring Emerson.
Federal Highway Trust Fund (FHTF) Update
Effect of FHTF on Federal Projects in Kentucky
Update on Brent Spence Bridge/Tolling Legislation in Ohio
Russ Romine, Deputy Secretary, Kentucky Transportation Cabinet, testified about the Federal Highway Trust Fund (FHTF), the FHTF’s effect on federal projects in the Commonwealth, and the Brent Spence Bridge tolling legislation in Ohio.
In response to questions from Representative Simpson, Mr. Romine said the President’s proposal gives the states more flexibility for using tolls on interstate highways. He said Oregon has a pilot program in place for weaning themselves off the gas tax and moving toward taxing miles traveled.
In response to questions from Representative Collins, Mr. Romine said there are GPS elements in tracking usage of the highway system. He also said funded active projects would continue to progress. In the coming weeks, we will see details on how USDOT will implement a delayed reimbursement process. If no more funds become available from the FHTF, there will be no new projects for 2015. Typically a project takes three years to spend out.
In response to questions from Chair Combs, Mr. Romine said the $55 billion needed to keep the FHTF solvent represents national numbers, which translates to about $700 million per year for Kentucky. Chair Combs requested a breakdown of those numbers be provided to the subcommittee in the future, including more detail on the type of projects involved.
In response to a question from Representative Couch regarding the effect of inflation on purchasing power, Mr. Romine said that, in 2013, the federal tax of 18.4 cents is worth 11.0 cents in purchasing power.
In response to questions from Representative Simpson, Mr. Romine said the cabinet closely follows any proposals that could impact the Corridor project. He said Senator Paul has advocated the elimination of aid to foreign countries in order to fund large infrastructure projects. The process of analyzing disproportionate impacts of tolls on low income and minority populations is ongoing. Toll discounts or free passes cannot be provided based on place of residence. Chair Combs requested that additional information be provided to the subcommittee at a later date.
Road Fund Update
Tammy Branham, Executive Director, Office of Budget and Fiscal Management, Transportation Cabinet, provided an update of the Road Fund.
In response to a question from Representative Collins regarding the usage tax, Ms. Branham said she had anticipated it would cost 2.4 cents per gallon in the fourth quarter. In the current quarter the loss was 1.4 cents per gallon, indicating an overestimated projection for the fourth quarter.
In response to a question from Senator Higdon, Ms. Branham said the taxes are collected at the wholesale level.
In response to questions from Representative Stewart regarding railroad projects with fences and other additional costs, Mr. Romine said they look at all projects to determine if they could be built in a more practical and cost efficient manner.
Discussion of Public-Private Partnership (P3) Legislation
Brent Cooper, Interim President, Northern Kentucky Chamber of Commerce, Chad Day, Executive Director, Greater Cincinnati Building Trades Council, and Sherry Carran, Mayor, City of Covington, testified about the use of Public-Private Partnerships.
In response to a question from Representative Simpson, Mr. Cooper said Kentucky is one of only ten states not using P3s.
In response to a question from Representative Collins, Mr. Cooper said the numbers presented on highway safety were provided in a study performed by OKI and the information was based on a seven mile corridor in Kentucky and Ohio, including the Brent Spence Bridge. He did not have data regarding the number of fatalities on the bridge, but noted that the bridge is unsafe. He said the number of trucks and commuters was tracked by traffic counts.
There being no further business, the meeting was adjourned at 11:55 AM.