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issue_20070101


Issue Brief Offers Transportation Finance Options for States

Issue Brief Offers Transportation Finance Options for States

A new issue brief from the National Governors Association Center for Best Practices (NGA Center) examines the transportation finance challenges faced
  • Written by American City & County Administrator
  • 17th February 2007

A new issue brief from the National Governors Association Center for Best Practices (NGA Center) examines the transportation finance challenges faced by states and outlines tools available to address them. The brief was released by Indiana Gov. Mitch Daniels and Pennsylvania Gov. Edward Rendell at a media briefing in the National Press Club.

According to the brief, states are facing a number of critical transportation challenges, including finding sufficient resources to finance all of their transportation needs. A recent study by the National Chamber Foundation of the U.S. Chamber of Commerce estimates $222 billion in public investment in highways and transit is needed annually to maintain the current surface transportation system, and an annual public investment of $288 billion is needed to advance the system to a level that enhances the nation’s productivity. There are serious questions as to whether the current system of transportation finance can provide that level of support.

Governors are considering a variety of options to fund transportation systems. Gov. Daniels has leased the Indiana toll road and Gov. Rendell has asked the investment community for statements of interest in leasing the Pennsylvania turnpike. The brief discusses these and other strategies that can be pursued alone or in combination with taxes, pricing, and demand-side solutions as part of a comprehensive financing structure, including:

–tax-based approaches for increasing revenues;

–toll and road-pricing schemes to raise revenues;

–debt financing to reduce project development costs;

–asset leases to raise revenues;

–creating more effective partnerships with local governments; and

–reducing long-term growth in highway travel demand.

Founded in 1908, the National Governors Association (NGA) is the collective voice of the nation’s governors and a respected public policy organizations. Its members are the governors of the 50 states, three territories and two commonwealths. NGA provides governors and their senior staff members with services that range from representing states on Capitol Hill and before the Administration on key federal issues to developing and implementing innovative solutions to public policy challenges through the NGA Center for Best Practices.

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