Eye On Boise

A squabble over highway bonding

What a squabble that was in JFAC this morning over GARVEE bonding. The successful plan lists out this spending, totaling $246 million, for the next round of highway bonds:
- $23 million for Garwood to Sagle on U.S. Highway 95 in North Idaho
- $12 million to finish the section of Highway 95 from Worley north
- $17 million for a new connection from I-84 to Highway 44 near Emmett
- $126 million for I-84 from Caldwell to Meridian
- $28 million for I-84 from Orchard to Isaacs Canyon
- $40 million for U.S. 30 from McCammon to Lava Hot Springs
But, of course, Gov. Butch Otter called on lawmakers in his State of the State address this year NOT to list specific highway projects in legislation, and instead to leave that judgment to the professionals at the Transportation Department and the Transportation Board.

ITD had planned to spend another $50 million on the Garwood to Sagle project, the congested section of Highway 95 between Coeur d’Alene and Sandpoint, but that was partly for an interchange that North Idaho lawmakers objected to. Sen. Shawn Keough, R-Sandpoint, was hopeful the money could speed up other aspects of the project, but lamented that instead those funds were moved down to the two Treasure Valley projects, for the Caldwell-to-Meridian freeway and the new road to Emmett.

“Should the Legislature continue micro-management in this fashion, the north will be outvoted and out-maneuvered politically, and that’s a really depressing thought,” Keough said.

Senate Finance Chair Dean Cameron, R-Rupert, pushed hard for an alternative plan he co-sponsored with Keough, to instead fully fund the governor’s $264 million bonding proposal and on top of that, add $23 million to be spent on regular highway projects in the State Transportation Improvement Plan. Keough said those everyday projects have suffered because of need to pay interest payments on GARVEE bonds, and the $23 million would offset that to keep the regular highway plan intact. The alternate plan didn’t list specific projects.

Cameron told the joint committee, “You have a tough decision before you and a tough philosophical decision.” The whole point of GARVEE bonding is to borrow to allow projects to be built sooner, avoiding rampant inflationary costs for highway construction materials while addressing safety needs, he said. But if projects in the STIP have to be put off to pay GARVEE interest, the same inflationary problem happens with them. “It only makes sense from an inflationary standpoint if you are not causing inflationary costs to compound” for regular highway projects, he said.

Cameron also said, “The intent of listing the six projects is to supplant our knowledge for that of the board. … We’ve had members of the Legislature go down to intersection by intersection to review these projects. That’s inappropriate.” It means, he said, “Those with the power get the projects, and those without the power do not.”

Sen. Elliot Werk, D-Boise, proposed the lowest-price plan at $211.7 million. His proposal directed the Transportation Department to use the money only for the same projects started with this year’s $200 million round of GARVEE bonding. Werk said the figure was based on work that actually could get done in the next fiscal year.

Henderson said to him, the list of projects was a “scorecard.” “This then becomes, in my mind, the scorecard for ITD and the Washington Group on how well they accomplish this project,” he said. Henderson earlier had suggested that Idaho might not want to issue any more GARVEE bonds next year, because it was still working on this year’s projects. “I thought, hey, if they’re not getting anywhere, don’t give ‘em any money,” he said. “But as I talked to leadership, the additional appropriation came around.”

Henderson said the issue is so touchy that Jeff Malmen, Gov. Butch Otter’s chief of staff, changed a single word in his motion “within minutes of when I walked in there.”

Even with the GARVEE program, JFAC members generally agreed that Idaho will need to raise gas taxes in the future to keep up with its pressing transportation needs. “A gas tax increase is inevitable,” Keough said. “The need is there, the money is not. Whether we do GARVEE or don’t do GARVEE, we’re looking at a gas tax increase of some sort very soon.”

Otter made a similar statement yesterday to the Idaho Press Club. He also indicated that the $246 million was a figure he “could live with.” His original proposal was for $264 million in GARVEE bonding next year.




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