The fourth meeting of the Interim Joint Committee on Transportation was held on<Day> Friday, September 26, 2008, at 10:00 AM, at the RiverPark Center in Owensboro, Kentucky. Senator Brett Guthrie, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator Brett Guthrie, Co-Chair; Representative Hubert Collins, Co-Chair; Senators David E. Boswell, Bob Leeper, R.J. Palmer II, Dick Roeding, Richie Sanders Jr., Brandon Smith, and Gary Tapp; Representatives John A. Arnold Jr., Eddie Ballard, Larry Belcher, Jim DeCesare, Melvin B. Henley, Arnold Simpson, Ancel Smith, and Greg Stumbo. Non member legislators attending the meeting were: Senator Dorsey Ridley and Representatives Dwight Butler, Jim Glenn, Tommy Thompson, and Don Pasley.
Guests Appearing Before the Committee: Tish Correa-Osborne, Chair, and Jody Wassmer, President, Greater Owensboro Chamber of Commerce; Tom Watson, Mayor, City of Owensboro; Bruce Kunze, Commissioner, Daviess County Commissioner; Stephen Johnson, Owensboro Medical Health System; Nick Cambron, Chair, Chamber Leadership Initiatives for Northwestern Kentucky; and Mike Hancock, Chief of Staff and Ted Merryman, Chief District Engineer, District 2, Kentucky Transportation Cabinet.
LRC Staff: John Snyder, Jim Roberts, Brandon Smith, and Linda Hughes.
Ms. Tish Correa-Osborne, Chair, Greater Owensboro Chamber of Commerce’s welcomed the Committee to Owensboro. She said that Owensboro is the third largest city within the state with its airport having the second largest runway in the state. She also emphasized that there is much room for growth citing the fact that Owensboro does not have a state university or an interstate within its boundaries.
Mayor Tom Watson, City of Owensboro, discussed the city’s riverfront development efforts with the committee and presented a slideshow of a number of projects the city envisions developing in the future. One in particular project was a new hospital in which, Mayor Watson commented would be discussed more thoroughly later in the meeting.
Senator Smith commented on one of the projects, a marina encompassing 200 boat slips. He said that there was a growing population of boaters and that there were very few marinas in the Owensboro’s immediate area in which to purchase gasoline/diesel. He commended the city on its foresight in taking advantage of this growing population’s needs.
The next person to offer testimony was Mr. Bruce Kunze, Daviess County Commissioner. Commissioner Kunze said that there are approximately 56,000 citizens within the city’s limits and another 37,000 citizens just outside the city limits. There are 550 miles of county roads and 342 miles of state roads.
Commissioner Kunze stated there are five major projects that need fiscal support on the already tight Daviess County Fiscal Court budget. Those projects are:
1. The roundabout at KY 56 & KY 81. He said that fiscal court may need to consider funding a portion to complete the Worthington Road alignment if additional federal funding does not materialize.
2. Widen Southtown Blvd. to four lanes between Frederica and Carter Roads. This corridor is between a busy commercial district and Apollo High School, with proposed residential development involved. At the moment this project is totally dependent on state funding and the state’s priority is to fund state projects that have federal matching monies.
3. Glover Cary Bridge renovation. This renovation is budgeted at $2.6 million for 2010; however, new estimated cost is now $8.2 million, including cleaning, painting, and deck work.
4. Extend Fairview Drive from dead-end at the Downs subdivision to Pleasant Valley Road (five miles). This should be a top priority for traffic flow between KY 54 and Pleasant Valley Road, especially with the new hospital construction.
5. Widen KY 54 from mile 4.5 to 8.0. Heavily traveled east-west route from Owensboro to Whiteville and east Daviess County.
Commissioner Kunze stated that Owensboro is currently developing a downtown comprehensive plan for future residential, commercial, and public development. This plan will include a new hotel, convention/multi-purpose center, as well as the possibility of an outdoor events center. The city is investing significant dollars into this planning process. He cautioned that one issue that must be addressed in this revitalization plan is traffic flow and traffic patterns. Second Street is currently a one-way westbound route that carries a heavy concentration of semi-truck traffic.
Jody Wassmer, President, Greater Owensboro Chamber of Commerce, commented on several projects that proposed transportation improvements for the Owensboro region. Those projects were: Interstate 69, Interstate 66, and U.S. 60 East Bypass. Mr. Wassmer said that he believed that Kentucky’s foresight to build parkways years ago paves the way for them to become interstate spurs. He said that these spurs allow counties touched by spurs to tell companies they are essentially on an Interstate, thus helping to bring industry into a county that does not actually have an interstate within its boundaries. He said that having an interest within 25 miles is very crucial in drawing industry to an area. And, research shows that on average a county’s per capital income is 30 percent higher than a county that does not have an interstate.
Stephen Johnson, Owensboro Medical Health System, discussed the need for the U.S. 60 Bypass project in East Daviess County. He said that the Owensboro Medical Health System (OMHS) decided in 2007 to move forward with a $350 million new hospital construction project along the proposed U.S. 60 bypass extension corridor. OMHS is the 22nd largest employer in the state which services nine Kentucky counties and two Indiana counties, with an annual payroll of approximately $107 million.
Mr. Johnson said that OMHS is an international player in plant made pharmaceutical research and biotechnology using tobacco plants. Its cancer research program is a joint venture with the University of Louisville. And it is the owner of Kentucky BioProcessing, the world’s only commercial bioprocessing facility of its kind in the world.
Mr. Johnson said that the nation’s baby boomers are reshaping the nation’s health care industry. He said that the over 65 population will nearly double today’s population with six out of every ten managing more than one chronic condition. And one out of every four senior citizen will be diabetic. He said that by year 2030 baby boomer will account for more than twice as many hospital admissions as they do today and there will be over four million more visits to an emergency room.
Mr. Johnson said that OMHS Emergency Department is the most visited single emergency department in the state, with 66,000 visits annually. And without a question, the new facility is much needed in the area and thus the U.S. 60 Bypass extension plays a significant role in meeting Owensboro’s daily as well as future health care needs.
Mr. Johnson said that the U.S. 60 Bypass extension will be the north-south four-lane corridor between I-64 and I-65. It will help ease the future traffic and safety concerns when OMHS has completed its 24/7/365 facility in 2012. He commented that he recently heard that Fort Knox is closely monitoring this bypass for future military and emergency management perspectives should natural disaster or a terrorist attach incapacitate bridges in Louisville and Evansville.
The last persons testifying before the committee were Mike Hancock, Chief of Staff and Ted Merryman, Chief District Engineer, District 2, Kentucky Transportation Cabinet. Before their testimony Co-chairman Collins asked Mr. Hancock to briefly explain the controversy over the distribution of truck registration fees to counties under the revenue sharing provisions of KRS 47.020. This statute appropriates 30 percent of all commercial truck registration fees to be distributed equally among all 120 counties.
In August, counties were notified that their share of these funds were being reduced due to the passage of HB 535 of the 2006 Regular Session, which eliminated the 6,000 pound commercial vehicle plate and reduced the state fee for the 10,000 plate from $24 to $12.
Mr. Hancock stated that after meeting with LRC staff, the Cabinet had undertaken an in-depth review of the reasons for the reduced county share. According to the Cabinet review, the total county share declined $7.6 million between FY 07 and FY 08, a reduction of $63,329 per county. This reduction can be attributed to four factors:
1. IRP/Ad Valorem Issue – In FY 07, the Cabinet began collecting Ad Valorem taxes on International Registration Plan (IRP) vehicles, vehicles that travel in more than one state. The Ad Valorem collections were incorrectly included in the revenue sharing calculation in FY 07, resulting in a $3 million overpayment to counties which was recouped this year at a cost of $24,490 to each county (38.7 percent of total reduction).
2. A decline in IRP Registrations – Due to the economic downturn, IRP collections were down in FY 07. The total county share of this decline was $2.15 million or $17,920 per county (28.3 percent).
3. Commercial Vehicle Coding – The elimination of the 6,000 pound plate exposed a problem in that some non-commercial vehicles with 6,000 pound plates were being coded as commercial vehicles and the resulting registration fees were being improperly revenue shared. This error amounted to a reduction in the total county share of $2.2 million, or $18,668 per county (29.4 percent).
4. HB 535 – The impact of HB 535 reduced the total county share by $216,000, or $1,800 per county (2.8 percent).
Following the explanation of the revenue sharing issue, Mr. Hancock discussed highway projects in Highway District 2, including I-69 and I-66. With regards to U.S. 60, Mr. Hancock said that it was the Cabinet’s position to construct the western portion of the Bypass, which offers access to the new hospital facility, as quickly as possible. He said that the eastern portion of the Bypass would be constructed at a later date. Mr. Hancock said that there are still major hurdles to cross before I-66 or I-69 can be constructed. These hurdles include federal and state appropriations and upgrading parkways to meet federal interstate standards. He said that while it is true that Congress has designated I-69’s route through Kentucky, it has yet to designate I-66’s route. Mr. Hancock said the I-66’s expansion program has not been completed at this date.
With no further business before the committee, the meeting adjourned at 12:15 p.m.