MacIver News Service | Jan. 31, 2019
By M.D. Kittle and Bill Osmulski
MADISON — Craig Thompson sees himself as a consensus builder.
The state Department of Transportation secretary-designee said as much Thursday at the first meeting of Democrat Gov. Tony Evers’ Transportation Stakeholder Task Force.
“We are not doing this for any other reason than to truly gain your input and find out where we can find the most consensus for a solution for a transportation system that is not meeting the needs of the economy that we have right now,” Thompson said.
But Thompson, a long-time lobbyist for transportation interests, comes to the head of the task force table with a “Just Fix It” point of view, and that could spell trouble for taxpayers.
Thompson certainly hasn’t made much room at the table for fiscal restraint. Not one taxpayer advocacy group was on the invitation-only list for Thursday’s day-long session in Madison, and it doesn’t appear such representation will be at similar task force meeting scheduled for Monday in La Crosse.
“We believe that this is the most inclusive group that we’ve ever brought together in order to get the different perspectives on our transportation system,” Thompson declared.
There are plenty of representatives from government, like Jerry Deschane of the League of Wisconsin Municipalities, Donna Brown-Martin of the Milwaukee County Department of Transportation, and Dan Fedderly of the Wisconsin County Highway Association. There are members from the transportation trades, like Robb Kahl of the Construction Business Group and Chris Klein of the American Council of Engineering Companies of Wisconsin. The Corn Growers are there, as are the Commercial Association of Realtors and the tourism industry. Environmental interests are represented through 1000 Friends of Wisconsin, and the bicyclists have a rep on the task force as well.
.@WisconsinDOT Task Force will consider “dizzying” number of tax and fee hike options on Monday. Some, like the @LeagueWIMunis couldn’t wait to pitch their own ideas on where to raise taxes next. #WIright #justfixit pic.twitter.com/NutmSF0j5o
— MacIver News Service (@NewsMacIver) February 1, 2019
Sure, there are a few Republican lawmakers and Schneider National, which joined a coalition of freight haulers last session in opposing a bill that would have hit heavy trucks with a costly per-mile fee.
But the vast majority of task force members have been all-in on finding a lot more money for transportation, even at higher rates for taxpayers.
“What I’m hoping is that this task force doesn’t become a tax force,” Sen. Tom Tiffany (R-Hazelhurst) told MacIver News Service this week.
Tiffany and other fiscal hawks in the Senate are hopeful the Evers DOT thinks savings and reforms first before gas tax hikes and other taxpayer-funded revenue “enhancers.” If Thompson’s positioning at Thursday’s task force meeting is any indication, continued reforms to a bloated transportation bureaucracy may not even crack the list of recommendations.
“We work very hard at Wisconsin DOT to identify cost savings and efficiencies. We have a lot of successes, but that alone won’t be enough to address future needs,” said Dana Burmaster, director of the DOT’s office of Management and Budget.
Indeed, the DOT has been working hard for the better part of the past couple of years trying to right an agency that was drowning in cost overruns and mismanagement.
A Legislative Audit Bureau Report issued in early 2017 found that several major transportation projects completed over a decade — between 2006 and 2017 — came in at $1.5 billion over budget, twice their initial projection. And another 16 ongoing major highway projects soared by $3.1 billion.
The department failed to consider details like inflation in estimating costs for multi-year projects. The DOT solicited only a single bid for 363 projects, totaling more than $1 billion in contracts. With a lack of competition, contractors had no incentive to keep costs low. Besides being bad business practice, DOT regularly broke state law in budgeting, negotiating, communicating, and managing contracts.
Dave Ross replaced former DOT Secretary Mark Gottlieb, who resigned in disgrace. Ross began changing the culture of the troubled agency and wringing savings out of its bloated budget. Asking tough questions and incentivizing efficiency paid off – fast. Almost overnight, the DOT became a fount of innovation, as evidenced by $69.2 million in savings in 2017.
While those savings are a small portion of the approximately $6 billion biennial transportation budget, Ross and his team were constantly finding more savings and legislative initiatives, such as repealing prevailing wage and federal/state transportation swaps that are targeted to create more efficiencies and greater savings for taxpayers.
A MacIver Institute analysis last year found nearly $2 billion in wasteful transportation spending.
There were definite signals Thursday that Thompson and the Evers’ DOT aren’t all that interested in staying on the reform-first road.
Burmaster lamented that Wisconsin’s gas tax, already one of the highest in the nation at 32.9 cents per gallon (including a 2 cents per-gallon environmental clean-up fund fee), could have netted an additional $2 billion had indexing remained in place. In 2005, then-Democratic Gov. Jim Doyle and the Republican-controlled Legislature ended indexing, which pegs the gas tax to the federal consumer price index. Doyle wanted to bring it back in 2009 amid the a massive budget shortfall.
Thompson began the day’s brainstorming session by asking task force members to review some lengthy reports: the “Fund Solvency Report” of December 2016, the “No Easy Answers” legislative report from earlier that year, and the 2013 “Keep Wisconsin Moving” report from the Wisconsin Transportation and Finance Committee.
Thompson, as executive director of the Wisconsin Transportation Development Association, was a member of the committee and helped put together the “Keep Wisconsin Moving” study, another transportation doom-and-gloom document that cried funding poverty while including all of two sentences on what the DOT did to save taxpayer money in the 163-page report.
Thompson continued to push the report and the transportation-system-is-collapsing narrative in this 2018 video.
The “No Easy Answer” report, like Thompson and his TDA, hammered on Big Transportation’s talking points, citing a U.S. DOT report that found Wisconsin roads ranked 47th in the nation. Their union friends paid for the expensive “Scottholes” campaign that dogged former Gov. Scott Walker for the state of Wisconsin’s highways and byways.
Because of Walker and his refusal to raise gas taxes and fees, Wisconsin faced a $1 billion transportation funding shortfall, according to Big Transpo. But that debunked number is wishful thinking, literally. It’s based on a department wish list of unvetted proposals. The nonpartisan Legislative Fiscal Bureau noted in its assessment that the $939 million funding gap was a projection by LFB when asked what DOT’s budget would look like under a cost-to-continue scenario with all bonding eliminated. Nearly every state uses bonding to help pay for roads. Eliminating borrowing is a near-impossibility in the high-cost world of transportation projects.
The 2013 report that Thompson helped put together came up with six proposals that would raise taxes by a total of $638.7 million annually, or about $1.3 billion over a two-year budget. Here’s what the report proffered:
1. Raise the gas tax by 5 cents per gallon, hiking taxes by $159 million per year.
2. Adopt a mileage-based registration fee, wherein those driving passenger vehicles and light trucks would have to pay 1.02 cents per mile they drive. That Big Brother provision would raise taxes by $228 million every year.
3. Increasing the registration fee for heavy trucks by 73 percent, an initiative that would generate an estimated $84.8 million per year.
4. Increasing the registration fee for Wisconsin-based motor carriers in the international registration program by 73 percent, a move anticipated to bring in about $59.1 million annually.
5. Increasing the driver’s license fee by $20 for all original licenses and renewals, raising taxes by $16.1 million annually.
6. Applying the sales tax to the trade-in value of a car, a provision that’s sure to hit Wisconsin’s poorest the hardest. That idea would grab about $91.7 million annually.
“I think all of those three together provided a very good baseline,” Thompson said of the reports. “We’re going to provide you over the next few days with what we believe as much of the relevant information you need to make informed recommendations to us,” he told task force members.
The task force isn’t merely looking at Wisconsin’s roads. It wants to take a broader view of transit and bicycle/pedestrian programs (more bicycle roundabouts on the way?), freight and passenger rail (an Obama-style passenger train boondoggle?), and the aeronautics program.
Evers told task force members that the transportation problem isn’t an issue of expenses, it’s an issue of revenue. That is, the bloated DOT needs more taxpayer money.
“I know Craig (Thompson) is going to be an outstanding leader for us, and he and his staff are going to do a great job providing you with the information to come to some solid and basic solutions,” Evers said.
Thompson still must face confirmation from a Republican-controlled Senate with several members concerned about his transportation lobbying past. Perhaps they’ll be more concerned when they see what he seems to be pushing.
Ola Lisowski contributed