Looking into the transportation crystal ball

We’ve mentioned before that 2009 is a banner year for transportation investments. The construction season that just ended was the largest in state history, as our investments from 2003 and 2005 hit their peak. The federal economic recovery funding also provided a boost.

At the same time, as we peer into the future, challenges emerge. Page nine of the transportation budget passed last spring shows that revenue projections over the 16-year planning horizon dropped a couple of billion dollars over 2008’s projections.

Why? The major factor is the changing habits of drivers. People are driving less and are using more fuel-efficient vehicles, which is causing fuel-tax revenue to dip. Moreover, fuel taxes are flat rates, resulting in decreased purchasing power as years go by. These fuel taxes revenues form the large part of the transportation budget.

Recognizing these long-term trends, transportation leaders last session called for a study of potential financing methods for the future. The Legislature’s Joint Transportation Committee earlier this week heard the findings of the “draft final” report on this topic, prepared by a transportation consulting team.

The report shows some drastic numbers. For example, in 2025 the average driver will pay about 15 percent less in taxes (in 2025 dollars) compared to 2009. Adjusted for inflation, that’s about 38 percent less! The reduced revenue accounts for about $10 billion.

How to address this issue? The report explores myriad options, including fuel, system use, vehicle and driver funding methods. At this point, the report is intended simply as a look to the future, along with an array of potential options for the Legislature to consider in future sessions. Nothing is binding, and aside from starting a dialog, little to no action is expected this coming session. For now, it’s an intriguing look at our challenges and opportunities for funding the transportation system of Washington’s future.