Will PA take the road less traveled?
The elections are over, but the news is the same: higher taxes are on the way,
As expected the Transportation Funding Reform Commission which was set up to recommend an increase in taxes to fund mass transit along with road and bridge repair has recommended an increase in taxes to fund mass transit along with road and bridge repair.
This tax increase will be a whopper: $1.7 billion more of our money will be taken from us each year by our state government should the commission’s recommendations pass, which – at least in part – they likely will.
Remember all the fuss last summer about high gas prices? Remember how George Bush was to blame, even though the federal government hadn’t raised gas taxes? Now the Commonwealth of Pennsylvania is looking to raise gasoline taxes by 12.5 cents per gallon. And they are not going to stop there: registration and other fees would be raised, and real estate transfer fees would also be increased from two percent to 2.9% if the commission’s proposals are adopted. Nobody has explained yet how real estate transfer fees relate to transportation, but who pays attention to such tiny details?
In an effort to minimize public perception of the impact of the proposed tax hike, state transportation secretary Allen Biehler “estimates” the tax hike will cost the average motorist about $7.00 per month more when buying gasoline. Not included in that cost, however, is the additional amount we will pay in transportation costs for every good or service we purchase. The real impact on Pennsylvania families will be hundreds of dollars per year – on top of the already steep increase in gasoline already absorbed by the consumer.
Will the tax hikes be enacted into law? Past legislative initiatives by Governor Rendell have won approval in the Republican-dominated General Assembly as a result of an unholy alliance between Democrats and RINO Republicans – mostly Republican leaders and their key supporters. This issue will be taken up by the new General Assembly as it enters into the budget process early next year. It will be interesting to see whether that coalition holds in the new legislature, or whether this year’s elections have succeeded in breaking the stranglehold the tax and spend caucus has had on the General Assembly for the past four years (plus).
Rather than raise taxes, the General Assembly should insist on a new course of action. First, the state should embark on an aggressive program of instituting public-private partnerships to encourage private sector capital investment in Pennsylvania’s transportation infrastructure. This is already being done, with positive results, in many other states across the country. Even socialist-leaning France is ahead of Pennsylvania utilizing such an approach.
Here in the Keystone state the one transit agency that has seized the initiative on implementing public-private partnerships is the Pennsylvania Turnpike Commission. The turnpike commission struck a deal with the Host Marriott Corporation to rebuild and operate the turnpike’s aged and outdated service plazas. Rather than using public money to upgrade the facilities, Host Marriott will invest their own private dollars in rebuilding the service plazas. In exchange, the turnpike commission awarded Host Marriott a long-term contract to operate and share in the profits from the plazas. This deal frees up the turnpike to concentrate on its core operations: the upgrading and maintenance of the highway.
PennDOT, along with the state’s major public transit agencies would be wise to follow the turnpike commission’s lead – in fact the General Assembly should insist they do. Additionally, the legislature should compel cost cutting and streamlining of operations at both the Southeastern Pennsylvania Transit Authority (SEPTA) and the Port Authority Transit (PAT) in Pittsburgh before authorizing one more dime of state spending on those agencies.
With Pennsylvania’s business climate hovering near the bottom of virtually every ranking of the states, and taxes being cited as a major reason for our malaise, adding to the tax burden by raising gasoline taxes and real estate transfer fees would make us even less competitive. Clearly, cutting waste, eliminating bureaucracy, and embarking on public private partnerships would be a better course.
The two roads are diverging in Penn’s woods. This time, will the legislature take the road less traveled?