PMA Bulletin -- December 4, 2013

PMA Praises Governor Corbett, General Assembly for Funding Roads and Bridges

The ability to safely, effectively, and efficiently move goods and people throughout our commonwealth is a core function of state government. The $2.4 billion that will eventually be raised annually under the new transportation funding law is a sound investment in both safety and business competitiveness. The responsibility for this investment lies principally with government, as Governor Corbett often said throughout the legislative process.

Sound transportation infrastructure means improved logistics; improved logistics means enhanced business competitiveness. Having to take a 20 mile detour because of a weight restricted bridge, sitting in hours of traffic on major trucking corridors, and inefficient and outdated rail lines all add costs to creating and shipping goods in the Keystone State.

Pennsylvania is not investing anywhere near the levels when the last liquid fuels tax was increased in 1997. Higher gas mileage standards, hybrids, and alternative fuel vehicles have changed the dynamic of transportation infrastructure funding. Until now, the only way for incoming revenue to remain consistent is to have more vehicles use the existing structures, increasing use and thereby accelerating breakdown. Pennsylvania is also unique in that only money generated for the Motor Vehicle License Fund (through taxes, fees, and fines) can be used on road and transit projects. Not a cent of general fund revenue can help keep up with depreciation or inflationary costs.

“Manufacturers in Pennsylvania rely on sound transportation infrastructure to move over $72 billion in gross state product throughout the commonwealth,” said David N. Taylor, Executive Director of the Pennsylvania Manufacturers’ Association. “Supply chains and distribution networks depend on it, as well as getting our employees to and from their jobs. The cost of doing nothing is greater than the cost of addressing the problem. As our infrastructure system continues to age without adequate maintenance, it becomes increasingly expensive and difficult to revitalize.  The time to act is now, which is why Pennsylvania’s manufacturing employers thank Gov. Corbett, Secretary Schoch, the legislators of both parties who supported this critical pro-growth investment in public infrastructure, and all of the advocates who helped achieve passage.”

The accompanying chart shows how the tax, per gallon of gas, has plummeted over the past decades. In 1955, 22 percent of the cost of a gallon came from the gas tax. Factor in the vastly improved (and continuously improving via federal mandate) vehicle mileage standards and the diminishing returns become even more glaringly apparent.

Simultaneously, our roads and bridges have deteriorated, and the sub-par conditions are costing businesses time and money. Data from the American Society of Civil Engineers and the Road Information Program shows that by 2020, productivity losses due to underinvestment in transportation in the Mid-Atlantic region would cause the economy to underperform by $83 billion and 279,000 jobs will be lost, resulting in a drop in personal income of almost $300 billion if no action were taken.

A Washington based transportation research group, TRIP, recently released a study addressing road and bridge conditions, traffic congestion, economic development, highway safety, and transportation funding. Pennsylvania drivers lose a total of $9.4 billion each year as a result of driving on crumbling roads. When businesses employ entire fleets of vehicles, this seemingly personal problem multiplies quickly.

An example the report stated:

“Driving on deficient roads costs the average driver in the Harrisburg-York-Lancaster area more than $1,600 each year.”

Safety is a concern as well.

Without the funding bill, PennDOT Secretary Barry Schoch said the Department would not have the money to repair nearly 4,500 bridges that are rated "structurally deficient.” Pennsylvania leads the nation in that category. PennDOT recently had no choice but to place new or lower weight limits on about 1,000 bridges.

"Without additional revenues anticipated in the future, I have to make the safe and responsible decision to reduce how much weight is crossing these deteriorating bridges," Schoch said at the time. Schoch indicated that the state’s 40,000 miles of roads “are 40 years old and we’re putting overlays on; which is like putting paint on bad wood.”

Critics feel that Governor Corbett turned against his conservative values in spearheading and signing this legislation. The Pennsylvania Manufacturers’ Association asserts that just the opposite is true: There’s an inherent responsibility to pay for the essential functions of government that are necessary and that undergird our commonwealth’s safety and economic competitiveness. It’s conservative to address inevitable shortfalls that would compromise public safety rather than kicking the can down the road for the next elected official.

We applaud the Governor and the majority of members of the General Assembly for making the right choice by investing in our future through adequately funding our transportation needs.