Diversion of highway aid sparks concerns

“When you have $31 million and you wind up paying about $10 million more, it creates issues you don’t want to deal with.” Rep. Jim Fannin, D-Jonesboro,  House Appropriations Committee chairman

Debt from a more than two-decade-old bond issue continues to divert funds from Louisiana’s hard-pressed road program, officials said Tuesday.

The diversion planned for this year — $28 million — is the equivalent of one penny of the portion of the state’s gasoline tax for rank-and-file projects, Daniel Waguespack, budget analyst for the state House Fiscal Division, told the Louisiana House Appropriations Committee.

The total would be $183 million since 2008, officials said.

The issue surfaced during a three-hour review of Gov. Bobby Jindal’s proposed budget for the state Department of Transportation and Development.

The committee is in the early stages of reviewing key agency spending plans before the 2013 regular legislative session, which begins April 8.

The state already has a $12.1 billion backlog of road and bridge projects, and the outlook for any big gains in state or federal revenue is bleak.

Motorists pay 38.4 cents per gallon in Louisiana in state and federal taxes.

That includes 4 cents for 16 projects voters approved in 1989 — they are called TIMED — and another 16 cents for routine road and bridge building and maintenance.

The 4 cents was supposed to pay for the 16 projects, including the John J. Audubon Bridge that connects New Roads and St. Francisville.

But the original pricetag has shot up from $1.4 billion to $5.2 billion, and two projects are unfinished.

House Appropriations Committee Chairman Jim Fannin, D-Jonesboro, and other legislators said they are concerned about the continued diversions, which are expected to go on for years and grow.

Fannin said the initial transfer estimate last year was about $31 million and later grew to about $43 million.

“When you have $31 million and you wind up paying about $10 million more, it creates issues you don’t want to deal with,” he said.

State Rep. Jim Morris, R-Oil City, cited charts that show Louisiana’s highway fatalities have plummeted since 2007 at the same time the state was investing about $2 billion in highway and bridge improvements.

“That’s why I have a problem when we take money out of transportation,” Morris said.

State Rep. Jack Montoucet, D-Crowley, said another planned transfer of highway funds would move $74 million from the state’s road and bridge fund to the state Department of Public Safety’s State Police Traffic Enforcement Program.

Under questioning by Montoucet, a top official of DOTD, Eric Kalivoda, said that money could pay for about 200 miles of new blacktop on highways.

The diversion has sparked controversy in the past.

Former DOTD Secretary William Ankner told legislators in 2008 that the state would have to divert money from rank-and-file road projects to pay the borrowing costs of TIMED, which stands for Transportation Infrastructure Model for Economic Development.

Area lawmakers have noted for years that, because of the debt, less money is available for road work in the Baton Rouge area and elsewhere.

Kalivoda, deputy secretary for DOTD, has said the higher costs stem in part from a hike in building materials after Hurricanes Katrina and Rita in 2005.

The economic downturn was another factor, he said.

Michael Bridges, undersecretary for DOTD, said officials there are trying to refinance some of the bonds to trim costs.