We have transportation funding options; we just need to level with ourselves

The warning bells about growing debt levels in Wisconsin’s transportation fund have been sounded by commissions, legislators, the media, and stakeholder groups for several years now. That’s why it wasn’t terribly surprising that the Walker administration’s proposal to ramp up bonding in the transportation fund to $1.3 billion over the next two years went over like an osmium balloon. (Osmium is twice as dense as lead, by the way.)

But some have asked if this is an overreaction. Is it really so bad to borrow for big capital projects like rebuilding our freeways? Aren’t those just the types of projects that should be paid for over a period of time?

Debt is a completely legitimate financing mechanism for transportation projects. However, just like with our personal budgets, you need to have a plan and the discipline to stick to it. A monthly payment for a house mortgage or a car payment is fine if those payments are not consuming more and more of your disposable income every year. Debt is a financing tool, not a funding tool. There is a big difference.

In 2002, Wisconsin spent about 7% of its transportation budget on debt service. That number has ballooned to 17%. That’s a trend line that’s clearly unsustainable. If state legislators embrace the administration’s proposal, which they don’t seem ready to do, the amount of the budget eaten up by debt would leap to 25%. In fact, debt service would become the second-biggest program in the DOT budget — larger than general transportation aids to local governments or the southeast freeway megaprojects. Only the highway rehabilitation program would be larger.

The initial reaction from lawmakers in both parties has been encouraging. There have been bold statements about finding a more sustainable plan for transportation. Now for the hard part — settling on a solution. This has eluded Wisconsin for the past decade.



There is no one right answer. Options abound. The legislatively created Transportation Finance and Policy Commission outlined very specific options when it released its report back in January 2013. The Wisconsin Department of Transportation just put forth a proposal in November that offers real solutions. Business groups like Wisconsin Manufacturers & Commerce and some of its member chambers throughout the state have put revenue options on the table.

In order to finally have a breakthrough this time around, we are all going to have to be honest with ourselves, and our lawmakers will need to be honest with us. There are no magic beans.

We are Midwesterners, after all. We pride ourselves on our no-nonsense approach to the world. Let’s have an open dialogue about the most effective way to fund our immediate needs — one that won’t cost too much in the short run and won’t bury us in the long run, but that will ensure the safe and reliable movement of our Wisconsin goods, products, and people.

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