Solving engineering problems takes money. Engineers like solving problems. So money makes them happy.
The Texas Department of Transportation and its engineers are very happy these days.
Spend any time around TxDOT management, as I have recently, and the change in their mood from what I’ve seen for much of a decade is palpable. Getting an 80 percent vote of support from the public, with a $1.74 billion bow on top, will do that. Add in strong legislative support for TxDOT getting much or all of the remaining $600 million a year in “diversions” that normally go from the state highway fund to the state general fund, and the grins get broader.
Then you have the public statements of the incoming governor, current Texas Attorney General Greg Abbott, that he’d like to find an additional $4 billion a year for TxDOT without raising taxes or using tolls. Somehow.
Of course, it’s not as if TxDOT hasn’t had any money over the past 10 years or so. In fact, the agency’s annual budget, now close to $11 billion a year, has increased by about two-thirds, accounting for inflation, since I got this beat in 2003. But there was a cost to the agency’s standing with the public and the Legislature, and what will amount to a 20-year financial hangover of debt payments.
The late Ric Williamson, for four stormy and historic years as chairman of the Texas Transportation Commission, was the ultimate disrupter and change agent. Under his fiery direction, with the backing of his longtime friend Gov. Rick Perry and the compliance (at first) of the Legislature, TxDOT went on a five-year binge of tolling and borrowing. A lot of roads were built, but the state racked up more than $20 billion in debt from the laws and policies that Williamson and Perry brazened and wheedled into state transportation policy.
But this led to something of a public rebellion, then legislative pushback in 2007 and, after Williamson’s death late in 2007 and an embarrassing $1 billion budgeting error revealed in 2008, another legislative paddling in 2009. There were negative reports generated about the agency, both by the Texas Sunset Advisory Commission and by consultants hired by TxDOT, and then a controversial change at the top when a former Perry aide replaced a TxDOT lifer as executive director.
And as the debt-fueled geyser of spending fizzled down over the past five years, TxDOT was fogged by uncertainty and, in some quarters of the 12,000-employee organization, low morale. The anger had subsided, but a long-predicted fiscal cliff — a time when the agency could begin no new highway expansions — no longer seemed like bluffing. Was the agency’s reputation sufficiently rehabilitated that the Legislature and public would provide it with real money?
The Legislature said yes in 2013, and voters echoed that Nov. 4. TxDOT, thanks to passage of a state constitutional amendment, will now get half of the oil and gas severance tax revenue annually that otherwise would have gone to the state rainy day fund.
But TxDOT officials, and their legislative champions, say the fiscal job is far from done.
Based on a couple of studies, one by a committee appointed by the Texas Transportation Commission and another done by the Texas A&M Transportation Institute, TxDOT officials argue that the agency needs an additional $5 billion a year to maintain the state’s 80,000-mile highway system and keep urban and interstate congestion from worsening as the state grows. That figure consists of $3 billion to expand the system, $1 billion to maintain highways in general and another $1 billion for roads in the state’s several booming oil and gas areas.
The first $1.74 billion of the money approved by voters gets TxDOT about a third of the way to that goal, and only for this year. The amount will fluctuate yearly, based on oil and gas prices and production levels, and that first zag is likely to be down, given falling oil prices.
Ending those diversions of state highway dollars to the general fund would get TxDOT close to halfway to that $5 billion, and both Abbott and House Speaker Joe Straus are supportive. But the Legislature would have to replace that money — most of it pays for the Department of Public Safety — with other state revenue. It won’t be easy.
The remaining 50 percent will be even harder. The main candidate? Redirecting to TxDOT sales taxes on vehicle sales, an idea that was floated last session and got no traction. Taking that money from the general fund would leave less money for all the other things the state does.
Supporters of the constitutional amendment sending some of the oil and gas severance taxes to TxDOT talked all fall about wanting a big majority to show the Legislature that the public supports putting money into highways. They got the big number.
We’ll see if that leads to an even bigger number for TxDOT. The engineers are waiting.