TRANSPORTATION

Basic Transportation Funding

Once again, transportation funding was a big winner. The biggest change was the authorization of a new $1.8 billion bond for reconstruciton of I-15 in Utah County from Lehi to U.S. 6.

In addition, more new revenue was added to address immediate highway needs. As stated above, a 0.05% sales tax increase was enacted that will raise about $22 million annually for fixes to "choke point" road projects throughout the state. Those are road projects that require little money but have a big impact on congestion. The 0.05% increase means that on all purchases except food, Utahns will pay 5 cents more on a $100 tab. It means maybe a $9 increase in sales tax paid per Utahn per year. Legislative leaders called the deal a "tax shift" because other tax cuts will offset it.

SB 283, Transportation Funding Amendments, by Sen. Sheldon Killpack, added $200 million to the $1 billion bond passed last year, creating a new bond authorization of $1.2 billion. This is in addition to the Utah County bond mentioned above. Up to $90 million of the new ongoing money authorized last year will be used as the re-payment source for this new bond. In addition, after the first year, half ot the new 0.05% sales tax increase will be used to help pay off the bionds while the otherhalf will continue to be used for choke points. This bond authorization will be used for highway construction and reconstruction projects prioritized through the Critical Highway Needs Fund. The bill also increases the expenditure cap for projects prioritized through the Critical Highway Needs Fund and clarifies that the expenditure cap applies only to bond proceeds

I-15 in Utah County

Thorugh the passage of SCR 6, Concurrent Resolution on the Reconstruction of Interstate 15, by Sen. John Valentine, the legislature gave clear guidance to UDOT to begin work on reconstructing the Lehi to U.S. 6 segment of I-15 in Utah County. Legislators originally wanted to re-build the road from 12300 South in Salt Lake County to U.S. 6., but learned the size of that project might harm the state's ability to bond for other projects. The American Fork option was determined to be less risky, and by passing the resolution, lawmakers are clearly indicating their support to bond for the project in coming years.

Eventually, the project will cost over $1.8 billion and the resolution is an indication the state plans to bond for $1.8 billion of that, beginning with $100 million this year to be spent on planning and environmental studies. The final bond will be authorized in the 2009 session, although legislative leaders noted that taxes may have to be raised next year to help pay for highway and water projects, including a gas tax increase.

Airport Funding

Salt Lake City needs $35 million to enhance the light-rail line to the airport. SB 245, Funding Relating to Airports, Highways, and Public Transit, by Sen. Curt Bramble, was passed first to block Salt Lake City from using airport improvement funds to pay for the TRAX enhancements. Instead, such airport improvement funds are earmarked for “physical improvements” at the airport. To compensate for that restriction SB 245 then allows a first class city with an international aiport to raise the $35 million by earmarking for TRAX a $2 portion of the existing $10 local option fee Salt Lake City residents already pay when registering their vehicles. This raises about $1.8 million annually. UTA will now be able to bond against this revenue stream to pay for the light rail enhancements. Salt Lake City leaders are please to have a solution to the airport line funding.

SB 245 also creates two new ways for Utah County and Washington County to raise money to help their respective airports. Second class counties will be able to increase their local sales tax for airport, highway, and transit projects. Provo wants to add a radar system at its airport and Washington County is building a brand new airport. Provo also received $1 million in one-time funding from the Legislature to help fund a local match for the their radar funding. The revenues could also be used for road projects in Weber and Davis counties. The bill also allows counties to use tourism and recreation dollars for airport improvements.

Under SB 237, Delta will get a $5.7 million tax break, helping it retain its hub in Salt Lake City.

St. George will get a $39 million "bridge loan" from the state to allow it to immediately start building a new airport southeast of the city.

Mountain View Corridor

Private dollars of about $80 million were donated to pay for the Mountain View Corridor rights-of-way. To be used, however, this donation must be matched 3-to-1 by the state within 5 years. The donation frees up tax dollars that can now be used for specific projects in Salt Lake County.

In addition, a deal was struck to prevent future litigation on the corridor by providing a transit component within the corridor to mitigate air quality concerns.