Wisconsin’s transportation infrastructure network consists of roads (114,800 miles), bridges (13,700), rail lines (3,600 miles), airports (131) and ports (29). The financing for the construction, repair and maintenance of this multimodal system is a shared responsibility between the federal, state and local units of government.
A combination of federal aid, state gas taxes, annual vehicle registration fees and bond proceeds finance nearly all transportation infrastructure-related projects. Local property taxes are used to fund a portion of local road and transit programs. The allocation of these revenues is set forth by lawmakers through the enactment of the state’s biennial budget.
Roads and bridges are the primary components of Wisconsin’s transportation infrastructure network. Moreover, the costs associated with the construction, repair and maintenance of state and local roads and bridges are significant. For these reasons, WIB focuses its advocacy efforts on the state highway program and local transportation aids.
The State Highway Program (SHP) is responsible for the construction, improvement, and maintenance of Wisconsin’s 11,196-mile trunk highway system and for improvement on 550 miles of connecting highways under local jurisdiction. Local governments have jurisdiction over the majority of roads and bridges in Wisconsin. General transportation aid (GTA) is paid by the state to local governments (counties, cities, villages, and towns) to assist in the maintenance, improvement, and construction of local roads and bridges.
For the 2019-2020 legislative session, WIB advocates for the enactment of long-term, sustainable transportation plan. Moreover, we believe the plan should be consistent with the following principles:
1. Create a 10-year Transportation Plan with Predictable Funding Sources
It has been nearly thirty years since the State of Wisconsin operated under a comprehensive transportation plan that aligned project priorities with predictable funding sources. From our perspective, reinstituting this approach will provide the Wisconsin Department of Transportation and local governments with the flexibility to prioritize infrastructure projects and complete them in a timely manner.
2. Reduce Costly Construction Delays
When ongoing highway projects are delayed, the overall cost of the project rises. Construction inflation, for example, has averaged around 5% a year since 2000.
Project delays can also lead to “throw away” costs – temporary repairs to keep the roadway safe and commercially viable before the project can be completed.
3. Reduce Reliance on Borrowing
According to the non-partisan Legislative Fiscal Bureau, the issuance of bonds for transportation projects allows the benefits of the projects to be realized earlier than would be the case with cash financing, while spreading out the costs, through the payment of debt service, over the life of the improvement. However, continued reliance on bonds over a sustained period can result in debt service costs that consume an increasing share of transportation revenue.
In fiscal year 2017-2018, debt service as a percentage of gross transportation revenues was 18.7%. In other words, nearly $0.20 cents out of every transportation dollar is being used to pay existing debt. This level of borrowing is unsustainable.