|
Put
the "Trust" Back in Trust Fund
The
General Assembly is giving serious thought to
protecting the Transportation Trust Fund from
fiscal raids during hard times.
The
solution to our transportation funding problems is
simple: A $1
tax to be paid whenever a politician, pundit or
lobbyist uses the word “innovative” or the
phrase “public-private partnership.”
The money can be collected as campaign
finance reports are filed, and when the smoke
clears after next November’s election, we’ll
have a tidy sum (especially if we get $1 for every
direct mail piece using those magic words.)
Another
phrase that may end up on the list is “restoring
trust in the trust fund.”
That is rapidly rising to cliché status,
but let’s not tax that phrase just yet.
This is an area where we might make some
progress next year.
The
movement to enshrine the Transportation Trust Fund
in the Virginia Constitution gained steam in the
wake of the failed transportation sales tax
referenda in 2002. One of the many factors fueling
the "no" votes was an underlying fear
that the General Assembly could use the money for
something else, or use the money to replace other
funds put to another purpose (just as bad).
The
concerns had added weight because the General
Assembly had just done it.
During
the 2002 session, the legislature diverted about
$300 million in dedicated sales tax revenue from
the Transportation Trust Fund to the General Fund,
replacing the money with bonds.
It also promised to pay off the bonds with
General Funds, and if that promise is kept, there
is really no net loss to the TTF.
The
whole thing looked like legerdemain to skeptical
voters. It
happened again in 2003, when Gov. Mark R. Warner
ordered the transportation agencies to cut their
overhead (special funds) and transferred the
savings not into the construction program, but
into the General Fund. That money hasn’t been
paid back.
The
Transportation Trust Fund is one of several
accounts on the treasurer’s books with that
impressive phrase “trust fund” in its title,
but the words are just fluff. Every annual budget
bill states that its provisions are paramount
“notwithstanding any other provision of law”
and overrides numerous standing laws.
Special funds get raided all the time.
Only
a constitutional provision can prevent that.
There already are constitutional provisions
protecting the Literary Fund, the Lottery Proceeds
Fund and the Revenue Reserve (Rainy Day) Fund.
It’s time for one more.
The
2003 session saw probably a dozen proposed
amendments addressing this issue.
The effort focused on a version proposed by
Del. Bob McDonnell, R-Virginia
Beach.
It passed the House with no negative votes,
was reported out of the Senate Privileges and
Elections Committee and was heading to the Senate
Floor for a vote. Then
it suddenly was reconsidered by P&E and
referred instead to the Senate Finance Committee,
where it died on a five-to-nine vote.
The
senators voting to kill it were:
Chairman John
Chichester, R-Fredericksburg; Charles Colgan,
D-Manassas; Benjamin Lambert, D-Richmond; William
Wampler, R-Bristol; Walter Stosch, R-Henrico; Edd
Houck, D-Spotsylvania; Richard Saslaw;
D-Springfield; Bo Trumbo, R-Fincastle; and Russ
Potts, R-Winchester.
A
funny thing happened in 2004.
With very little pushing, it quietly came
back in Senate Finance and died on a
seven-to-seven vote. This version was sponsored by
Sen. Janet Howell, D-Fairfax, and supported by Lieutenant Governor Tim Kaine.
Those voting no this time were:
Chichester,
Wampler, Potts and Stosch, plus Fred Quayle, R-Cheapeake;
Emmett Hanger, R-Mount Solon; and John Watkins,
R-Midlothian. (The final two were new to the
committee in 2004.)
McDonnell
has already introduced a bipartisan version for
2005 which will grease through the House again.
You can read it here.
The amendment recognizes both the Transportation
Trust Fund (TTF) and the Highway Maintenance and
Operation Fund (HMOF).
It doesn’t prohibit transfers out of the
fund but it does require that there be (1) a
separate roll call vote by a supermajority and (2)
repayment of the money with interest.
You can borrow but you cannot steal.
It
probably isn’t fiscally prudent to prohibit
borrowing from the HMOF or TTF in an emergency.
That may be path back to Moody’s dog
house. But
there is no reason that it shouldn’t require the
accountability that comes from a recorded roll
call vote. That accountability is impossible when
the issue is buried in the 600-page budget bill.
Seeing
the new assault, Sen. Chichester is digging a new
defensive line. He
argues that the protection should work both ways,
that any such amendment should also prevent raids
on the General Fund.
Looking a couple of moves forward, he would
use that argument against ideas like the use of
the insurance premium taxes for transportation, or
using any future surplus for roads, mass transit
or rail projects.
Chichester
’s
idea should be considered.
If the final language also requires that
any General Funds diverted to the TTF must also be
subject to a separate roll call, and must be paid
back, that might not a bad idea.
I suspect what the good senator is really
worried about is revenue sources, not cash, and in
his zeal to protect General Fund revenue sources
he is dead-on correct.
This
will be one of the better shows in the 2005
General Assembly. Stay
tuned. But when you hear or read the words
“innovative” or “public-private
partnership” attached to transportation, wait
for the cash register to ring.
--
November 29, 2004
|
