ANNAPOLIS – Maryland business leaders have formed a coalition to combat Gov. Martin O’Malley’s plans to drain $100 million from the state’s transportation fund to help close a $1.4 billion budget deficit. Members of the newly formed State Transportation Alliance to Restore the Trust say Maryland’s roads are crumbling and hundreds of transportation projects have been delayed as the state continues to leech from the withering fund.
“Right now there is a billion-dollar tab … that’s been raided from the Transportation Trust Fund that has not been paid back,” said Lon Anderson, spokesman for AAA Mid-Atlantic and a member of the alliance. “The governor, in his latest budget, is proposing that the state dip its hand a little bit deeper into that state cookie jar and grab some more.”
O’Malley has drained nearly $700 million from the Transportation Trust Fund — which pays for all road and rail maintenance — in the past two fiscal years to help plug general fund deficits. He has penciled in another $100 million fund transfer in his fiscal 2012 budget.
Transportation funds depend primarily on gas tax revenues, which have been slashed by the recession.
Comptroller Peter Franchot says O’Malley’s borrowing “undermines the integrity of the trust fund.”
“It’s wrong,” Franchot said in an interview Tuesday. “The trust fund was set up for transportation purposes. It wasn’t set up for general fund relief purposes.”
Maryland lawmakers have been borrowing from the transportation fund to help close budget shortfalls since 1984. In 2003, the state stopped restoring new withdrawals.
The Maryland Department of Transportation has been issuing more bonds to keep pace with spending and replace its disappearing cash flow, increasing the fund’s outstanding debt from $1.6 billion in fiscal 2010 to $2.5 billion in fiscal 2016, according to the state’s budget analysts.
In the meantime, the agency’s debt service payments are expected to grow 91 percent from $151 million in fiscal 2010 to $288 million in fiscal 2016.
Many lawmakers are now lobbying for gas tax increases to help restore the money.
“Our Transportation Trust Fund has been depleted and the result of that is there is a backlog — a huge backlog — in the tens of billions of dollars in projects that aren’t getting done,” said Senate Majority Leader Robert Garagiola, D-Gaithersburg. “We need to move forward this session a transportation revenue package. We cannot wait another year.”
Garagiola said he is proposing legislation this year that would increase the 23.5-cent-per-gallon gas tax, among other revenue-generating initiatives, to raise more than $400 million annually for transportation. His bill would bar the state from using the fund as an extra bank account — which would require voter approval on the 2012 ballot.
A one-cent increase to the state’s 23.5-cent-per-gallon gas tax would raise roughly $30 million annually, he said.
