BECKLEY, W.Va. In the face of dwindling gas tax revenues, lawmakers are expected to consider new funding sources for West Virginia highway construction during a special session of the Legislature, which could take place as early as next week, according to House Finance Committee Chairman Harry Keith White.
Speaking to more than 100 people attending the 2009 West Virginia Transportation Conference here on Tuesday, White predicted that highway funding would be one of nine items on the call for the special session, expected to begin Nov. 17.
"It will be a tough year for any new highway projects," said White, D-Mingo. "But as bad as things sound, I think we will do what we can to come up with enough revenue to continue to move forward."
Thanks to a sluggish economy in which both business and discretionary vehicle use are trending downward while the purchase of fuel-efficient cars and trucks is rising, fuel consumption and state fuel tax income is in decline. Meanwhile, prices for such highway construction staples as asphalt and steel are on the rise, making highway construction more difficult to finance.
White said Dr. Tom Witt of WVU's Bureau of Business and Economic Research has come up with some innovative highway funding proposals to be considered by legislators.
"We've got to look outside the box," Senate Finance Committee Chairman Walt Helmick told those attending the conference. "We need to look at new user fees and public-private options, and we need to look at a general fund revenue source that can be dedicated to roads."
Helmick, D-Pocahontas, said the Legislature should also stabilize a portion of the state gasoline tax that is indexed to periodic changes in wholesale fuel prices. "We can't let it keep going way up and down and then playing games with it," he said. He said two recent freezes imposed on the tax have cost the state $142 million that could have been dedicated to highway projects.
About $29 million remains in pool created in 2007 with $40 million in budget surplus money to offset a freeze in the state gas tax. White said the Legislature could look at transferring more of that money into highway projects to make up for declining gas tax funds.
Gov. Manchin, who spoke to the conferees before White and Helmick, made no mention of a special session, but he did echo the finance chairmen's call for a new, dedicated funding source for roads and bridges.
"I don't see fuel usage going back up," he said. "I think we'll only see it decline, with more fuel-efficient cars being bought. We have to have a new funding source besides gas and privilege taxes."
Despite rising construction costs and declining fuel tax revenues, "We will maintain our roads, some way or another," Manchin said.
Keeping pace with recent highway construction achievements will be a major challenge in the years to come, state Transportation Secretary Paul Mattox told conference attendees. "But West Virginia is moving forward," he added.
Mattox said that during the past five years, West Virginia has completed or placed under construction 23 miles of divided, four-lane highway along Appalachian Corridor H; 21 miles on U.S. 35; 7 miles along W.Va. 9 in Jefferson County; 2 miles of the Mon-Fayette Expressway in Monongalia County; 6 miles of W.Va. 10 in Logan County; 14 miles of the King Coal Highway; 9 miles of the Coalfields Expressway; and completed the huge Blennerhassett Bridge on U.S. 50 near Parkersburg.
"I doubt any state in the country has those kind of highway construction numbers," he said.
Joe Deneault, chairman of West Virginians for Better Transportation, the coalition of contractors, suppliers, community leaders and elected officials sponsoring the conference, said a recent study by a national transportation group shows that the state will face severe funding challenges in coming years.
"The state has done a heck of a lot with what they've got," he said. "But TRIP [a national transportation research organization] says we're going to have a $5 billion shortfall in the next 10 years. ...We're kidding ourselves if we think we can keep going on the way things are without major changes. We need to raise an outcry to solve our transportation problems."
While Congress is considering a six-month extension of the Surface Transportation Act, the national funding mechanism for highway construction, which expires next month, Rep. Nick Rahall, D-W.Va., said he favors a six-year reauthorization of the act.
Rahall, vice chairman of the House Transportation Committee, said he and committee chairman James Oberstar, D-Minn., believe a six-year transportation budget would give state highway officials time to plan, prioritize and come up with cost-sharing strategies for road projects.
"Reauthorization would hasten the end of the recession and be even better for the economy than a second stimulus program," Rahall said.