POLICY ISSUES

Following are transportation funding issues that the KTFC believes the governor and General Assembly now face. Our purpose is to provide information to help policymakers understand the challenges, and the choices that must be considered in order to build and maintain a transportation system that will support economic growth and enhance the quality of life for all Pennsylvanians.

Despite our efforts, funding challenges remain. While the Commonwealth has made strides in repairing and restoring its transportation infrastructure, that progress is fading due to declining gas tax revenues, stagnant state funding, increasing emergency system repairs, and inflation that drives up the cost of construction materials and labor. The time is now. Policymakers must find a way to allocate additional revenue for transportation again, either by raising taxes and user fees, by redirecting resources from other state programs and services, or a combination of both. Failing to address the issue will send us back and hurt the state’s competitiveness.

Federal funding will help, but new matching money is needed. Pennsylvania can expect to receive a total increase of about $4 billion in new federal core highway money over five years, or on an average annual basis, about 40% more than the state’s federal-aid highway formula funding under the previous FAST Act. Also, a new program to repair bridges on the National Highway System will bring an additional $325 million in new bridge repair funds to PA annually. However, it is estimated that Pennsylvania will have to raise about $1 billion in new state revenue over the five-year period of the Infrastructure Investment and Jobs Act as a required local match to the newly available federal funds.

The diversion of Motor License Fund monies to State Police funding must end. Nearly one-fifth of our state fuel tax revenue and license and registration fees ($670 million) is not being used to improve roads and bridges, but rather is being diverted to support almost three-quarters of annual State Police operations. Since 2001, PA has diverted over $10 billion from the Motor License Fund.

Diverting resources from the Motor License Fund has had very significant consequences. The diverted amount this year alone would have paid for resurfacing almost 4,000 lane miles of roadway, or to design, replace and maintain almost 500 bridges for the next 25 years. So, while the public’s perception is that there’s a lot of highway work going on, there’s also a lot of highway work NOT being done because of the revenue being diverted.

A fair electric vehicle user fee should be implemented. All vehicles contribute to infrastructure wear and tear and should also contribute to its upkeep. While drivers of conventional vehicles pay fuel taxes that fund road and bridge programs, electric vehicles do not contribute equitably because they do not consume liquid fuels and the current collection mechanisms in place for EVs are unenforceable. The need for a fair contribution to highway maintenance will become more pronounced as the EV market grows.

A delivery fee for goods and services should be considered. As the home delivery economy grows and shared-ride services become more prevalent, our transportation infrastructure becomes more stressed, and increased traffic congestion slows travel for all. Delivery fees for these conveniences would create a new, substantial revenue stream for transportation infrastructure maintenance, at only a nominal cost to those who avail themselves of such conveniences.

Act 89 mandates a major shift in public transportation funding this year. The Pennsylvania Turnpike Commission has made its final $450 million payment to help fund public transit. Under provisions of Act 89, $450 million in vehicle sales tax revenues will replace Turnpike payments to fund public transportation in the FY 2022-23 state budget and beyond.

Act 89 helped to avert an infrastructure crisis in 2013 and offered public transportation the promise of sustainable funding to make critical repairs to maintain safe and reliable transit service across Pennsylvania. Despite Act 89’s success, Pennsylvania’s transit capital investment levels are far below competitor states and regions. The ability to raise and invest local funds for “spike” projects will help to advance critical projects of regional significance to meet a region’s mobility needs, attract companies and win new jobs.

Legislative support and action are needed now to:

• • Secure sustainable, bondable state funding at current levels.
  • Provide local governments the ability to generate revenues and invest in projects of regional significance.
  • Provide predictable operating and capital funding to all transit agencies.

Federal infrastructure funding is not a replacement for critical state capital funding through Act 89. State and local investment is also necessary to leverage the maximum amount of new funds available to transit systems in Pennsylvania.

Why public transportation matters. Sustainable, accessible, equitable public transportation benefits residents across the Commonwealth, not only with fixed-route service, but with shared-ride programs for seniors, people with disabilities and others with no options for travel. In all of the Commonwealth’s 67 counties (urban and rural), there is some form of public transportation service providing access to employment, education, training, health care and other life-sustaining activities. In addition, Pennsylvania transit agencies have purchased $2.6 billion in goods and services from Pennsylvania companies, creating jobs and economic opportunities in every county in Pennsylvania.

Funding solutions must effectively address all modes. The 2021 Transportation Revenue Options Commission emphasizes to policymakers the importance of the ultimate allocations of expanded revenue being flexible to ensure that each mode is effectively addressed. The proposed strategic funding proposal would make a substantial positive impact in addressing present unmet need across the transportation modes.

Although roads and bridges have traditionally formed the framework of our statewide transportation system, each transportation mode is essential for the efficient movement of people and goods.

Intercity bus, intercity passenger rail (Amtrak), commuter rail, light rail, etc.—plays a critical role in sustaining our economies, reducing congestion and transportation emissions, and ensuring access to essential goods and services for millions of residents across the state. Pennsylvania’s investments in passenger rail, particularly the Harrisburg-Philadelphia Keystone Corridor, have made this travel option extremely popular and growing steadily. However, along the corridor of Amtrak’s Pennsylvanian, passenger rail service operates as the primary, if not the only, intercity transit alternative available to many of the communities west of Harrisburg. Passenger rail service between Pittsburgh and Harrisburg should now be expanded by at least one train (from one a day to two) in order to improve mobility and connectivity for the central and western parts of the state. Upgrades for intercity rail need to be part of any transportation investment strategy.

Rapidly expanding use of micro mobility devices such as e-bikes, electric scooters, e-skateboards and robotic delivery devices are revolutionizing personal transportation options for local trips and delivery of goods. State policies do not currently address safe use of these new transportation technologies, nor are roadways and sidewalks designed to accommodate them.

It’s important that our transportation system includes strategically connected projects that create active-transportation networks. Non-motorized transportation facilities that allow pedestrians and bicyclists to safely navigate are a vital link in providing first- and last-mile connectivity, offering no-emissions travel alternatives that promote health, and expanding options for populations who cannot or choose not to drive.