ANNAPOLIS – The state fund that pays for roads, airports and mass transit services “continues to show strong financial performance” — for now.
But a fiscal analysis of the Transportation Trust Fund said that revenues are only expected to grow modestly and that spending is scheduled to decline after the turn of the century.
That has lawmakers worried that the fund lacks enough money to support major transportation projects in the state without a tax increase.
“I hope it’s (the trust fund) going to be as huge as it can be to cover the needs of the state,” said Sen. Ida Ruben, D- Montgomery.
Maryland Department of Transportation spokesman Chuck Brown said the fund has enough money to support transportation projects now in the pipeline.
Lawmakers may need to raise gasoline taxes, in 2001 or 2003, but there are no plans to raise the gas tax in the “immediate future,” Brown said.
Historically, the MDOT asks for a tax increase every four or five years, Brown said, to meet inflation and to pay for new projects.
But Brown said better fiscal management has allowed the agency to go six years without asking for a tax increase. The legislature last raised the gas tax in 1992, to 23.5 cents per gallon.
“We’ve avoided asking taxpayers for funds,” he said. “The good news is that we haven’t had to do that yet.”
State officials said they have squeezed an additional $1.3 billion out of the trust fund over the last four years, through tighter management and with the help of a strong economy, which has boosted car sales.
The fund is expected to raise $2.4 billion in fiscal 1999, through gas and titling taxes, federal assistance and other fees.
Gov. Parris Glendening cited the strength of the trust fund when he announced $281 million in new transportation projects in January. The added money brings MDOT’s six-year capital program to $5 billion to repair, construct and extend state roads, bus services and airports.
“The fund is in very good financial shape right now,” said David Juppe, a state fiscal analyst.
In a report for the legislature, however, Juppe said the trust fund will show “moderate growth in revenues” in the next five years at the same time that capital spending is “reduced in the long term.” That could hinder lawmakers’ longer-term plans to reduce congestion on state highways.
MDOT Secretary David Winstead played down published reports that the trust fund is in immediate trouble.
“The thought that we’re in a crisis is not true,” he said at a recent Senate committee hearing.
The trust fund is used to build and maintain state roads and help operate bus and rail transit services. MDOT also uses the fund to operate and maintain the Port of Baltimore, Baltimore- Washington International Airport and toll facilities and to regulate and license drivers and vehicles.
Juppe said the problem arises when people want to tap the trust fund for big, new projects that are not currently budgeted. He pointed to proposals for an Intercounty Connector, which would link Interstate 270 near Gaithersburg to Interstate 95 near Laurel, or to add lanes to the Capital Beltway.
“Something like that could not be added to the fund without some kind of revenue enhancement,” Juppe said.
And spending is currently scheduled to “decline to about $800 million in fiscal 2000, and continue decreasing in subsequent years,” according to a review of the MDOT budget for fiscal 1999.
Sen. Vernon Boozer, R-Baltimore, said MDOT should take action now to head off future problems.
“There are major transportation problems across the state,” Boozer said. “They should be concerned about it and tell us what they’re going to do.”