BOISE – Highway bonding plans approved by a divided legislative budget committee Wednesday shift $50 million from work on U.S. Highway 95 in North Idaho to freeway improvements in the Treasure Valley.
The plan, which cleared the Joint Finance-Appropriations Committee on an 11-9 vote, totals $246 million, $18 million short of the governor’s original recommendation and sets funding levels for specific road projects around the state.
That’s a departure from Gov. Butch Otter’s call at the opening of the session to leave selection of highway projects to professionals rather than politicians. But Otter agreed to the lower dollar figure in negotiations with lawmakers.
The successful budget plan, proposed by Rep. Frank Henderson, R-Post Falls, spends the lion’s share of the next round of bonding on freeway improvements in the Treasure Valley area of southwest Idaho. It beat out a $287 million plan proposed by Sen. Shawn Keough, R-Sandpoint, and a $211 million proposal from Sen. Elliot Werk, D-Boise.
Henderson said his proposal spends the money on work that’s ready to go.
“This then becomes, in my mind, the scorecard for ITD and the Washington Group on how well they accomplish this project,” he said.
Keough’s plan wouldn’t have named specific projects. She noted that the lineup in the successful bonding plan took $50 million the Idaho Transportation Department had planned to spend on the Garwood-to-Sagle project – the congested section of U.S. 95 between Coeur d’Alene and Sandpoint – and moved it to two Treasure Valley projects instead. That money originally was intended for an interchange that North Idaho lawmakers had objected to, but Keough had hoped the money instead could be used to speed up other aspects of the North Idaho project.
“Should the Legislature continue micromanagement in this fashion, the north will be outvoted and outmaneuvered politically, and that’s a really depressing thought,” Keough said.
Henderson said additional work on the Garwood-to-Sagle project isn’t ready to go. In fact, he had earlier suggested that Idaho might not want to issue any more GARVEE – Grant Anticipation Revenue Vehicle – bonds next year, because it was still working on this year’s projects. The state first approved the special type of bonding last year, which allows borrowing against future federal highway allocations.
“I thought, hey, if they’re not getting anywhere, don’t give ‘em any money,” Henderson said. “But as I talked to leadership, the additional appropriation came around.”
Henderson said the issue was so touchy that Jeff Malmen, Otter’s chief of staff, insisted on a one-word change in his proposal “within minutes of when I walked in there” on Wednesday.
Senate Finance Chair Dean Cameron, R-Rupert, pushed hard for Keough’s proposal to fully fund the governor’s $264 million bonding proposal and add $23 million for regular highway projects in the State Transportation Improvement Plan. Keough said those everyday projects have suffered because of the need to make interest payments on GARVEE bonds, and the $23 million.
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 routine projects have to be put off to pay bond interest, the same inflationary problem happens with them.
Cameron said members of the Legislature have reviewed the projects intersection by intersection. “That’s inappropriate,” he said, adding that, “Those with the power get the projects, and those without the power do not.”
Werk 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.
Even with the GARVEE program, members of the joint committee generally agreed that Idaho will need future gas-tax raises 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 a day earlier to the Idaho Press Club. He also indicated that $246 million was a figure he “could live with” for highway bonding.
Former Gov. Dirk Kempthorne first proposed the “Connecting Idaho” bonding plan, intended to complete 30 years worth of major highway improvements in 10 years. But costs have escalated, and lawmakers have limited the amount of bonds; that’s drastically trimmed back the amount of work the bonding plan can accomplish.
North Idaho members on the joint committee split on the bonding plan, with Rep. George Eskridge, R-Dover, backing Henderson’s plan, and Sens. Joyce Broadsword, R-Sagle, and Jim Hammond, R-Post Falls, backing Keough’s plan.
The bonding plan still needs approval from the full House and Senate and the governor’s signature to become law.