On Monday, the St. Petersburg Times published an editorial addressing Florida lawmakers’ shortsightedness about the state budget crisis. It highlights some of their short-sighted proposals that barely fill the budget gaps temporarily, including raiding of $466 million from the State Transportation Trust Fund (STTF).
You’ve listened to me share this message before but it still must be said: Raiding the State Transportation Trust Fund would be a certain budget no-no for Florida.
Adding $466 million to general revenue in the budget may seem like a great idea now but it is just a quick fix. In the mean time, state construction projects will come to a screeching halt and then what do we do? The STTF is a crucial element to Florida’s stability because our industry drives economic development. When construction stops, so does economic growth.
It is clear legislators are running out of funds to cut, but removing the money allocated for state construction projects is not the next place to look. Maybe it is time to stop shuffling money around like a deck of cards and find ways to generate new revenue.
Bolstering the State Transportation Fund has proven to be an effective way to not only subsidize but expand our economy in tough times. At its current level of funding, it is estimated that the STTF can have more than a $3 billion positive economic impact on our state. Instead of talking about cutting this fund to fill the gaps in other struggling areas, our lawmakers should be looking at the STTF as a way to stimulate our economy.
We all realize today’s hardships, but looking forward, what will this kind of piece-meal budget structure leave for Floridians? The St. Petersburg Times concluded with a concerning message:
“Republicans like to say they're building a budget for Florida to live within its means. They aren't. They're living on Uncle Sam's largesse and delaying for yet another year the real issue of how to pay for the services Floridians rely upon. That's not leadership.”
The State Transportation Trust Fund let’s Florida live within its transportation means – so why won’t they let us?
Today, the Florida House of Representatives will meet to discuss the various budget issues our state must address. We are calling on all supporters of our effort to reach out to their local House members immediately to share their concerns. For Florida’s future, we must keep the State Transportation Trust Fund intact. Please call today.
Wednesday, March 31, 2010
Tuesday, March 30, 2010
A Novel Concept – Let’s Pay for What We Do!
Maybe I am becoming too old-fashioned. I simply cannot relate to the “innovative financing” that our state and federal governments want to use.
When my parents sent me to college with my first checking account - this was before credit cards - they gave me one simple lesson: You could not write a check for an amount greater than your checking account balance! That seemed easy enough. From that day forward, I operated under the premise that if my bills appeared to exceed my earnings I had two options – spend less or earn more.
Government seems to rely on the backwards theory that an entity can spend more as its earnings, or revenues, fall. At the federal level we simply print more money. That’s a nice option if you can get away with it, but we would all be charged with counterfeiting. The Florida Legislature’s method of choice is to take from one pot and place in another. Unfortunately, at some point all the pots will come up empty.
Please understand, I am no wild-eyed tax and spend liberal. I do believe it is time we face the fact in Florida that we need more revenues. Our Florida tax system is broken. We have several options to look at and we should not rule any option out. Education and Medicaid eat huge portions of our general revenue. We cannot continue to rob our trust funds to balance our general revenue needs.
Not only is it foolish and short-sighted, I believe it is illegal. We are stealing from trust funds and spending the money in areas it was never intended for. With the federal stimulus (remember, they can print money) running out this year, we will be in a much bigger budget hole next year. At that point, even our trust funds won’t be able to fill the gap. Our leaders must step up and face our budget reality.
User fees are just that – user fees. You pay for it only when you use it. Florida’s gas tax, which helps generate revenues for our State Transportation Trust Fund, was intended for just that purpose. If you use Florida’s roads, you help make sure they are functional by contributing to the Transportation Trust Fund via user fees like the gas tax. With the proposed raids on the Trust Fund however, user fees ultimately become a tax as these revenues are no longer funding what they were intended to be collected for. We can fund transportation with fair and reasonable user fees. It’s time we did that before it is too late.
When my parents sent me to college with my first checking account - this was before credit cards - they gave me one simple lesson: You could not write a check for an amount greater than your checking account balance! That seemed easy enough. From that day forward, I operated under the premise that if my bills appeared to exceed my earnings I had two options – spend less or earn more.
Government seems to rely on the backwards theory that an entity can spend more as its earnings, or revenues, fall. At the federal level we simply print more money. That’s a nice option if you can get away with it, but we would all be charged with counterfeiting. The Florida Legislature’s method of choice is to take from one pot and place in another. Unfortunately, at some point all the pots will come up empty.
Please understand, I am no wild-eyed tax and spend liberal. I do believe it is time we face the fact in Florida that we need more revenues. Our Florida tax system is broken. We have several options to look at and we should not rule any option out. Education and Medicaid eat huge portions of our general revenue. We cannot continue to rob our trust funds to balance our general revenue needs.
Not only is it foolish and short-sighted, I believe it is illegal. We are stealing from trust funds and spending the money in areas it was never intended for. With the federal stimulus (remember, they can print money) running out this year, we will be in a much bigger budget hole next year. At that point, even our trust funds won’t be able to fill the gap. Our leaders must step up and face our budget reality.
User fees are just that – user fees. You pay for it only when you use it. Florida’s gas tax, which helps generate revenues for our State Transportation Trust Fund, was intended for just that purpose. If you use Florida’s roads, you help make sure they are functional by contributing to the Transportation Trust Fund via user fees like the gas tax. With the proposed raids on the Trust Fund however, user fees ultimately become a tax as these revenues are no longer funding what they were intended to be collected for. We can fund transportation with fair and reasonable user fees. It’s time we did that before it is too late.
Wednesday, March 24, 2010
State of the State Transportation Trust Fund: What Florida and New Jersey Have in Common
Yesterday, the Florida House of Representatives once again voted to push raids on the State Transportation Trust Fund (STTF). As an organization, we work to remind legislators of the consequences of their actions should they agree to divert more than $400 million in recurring and non-recurring funds from the Transportation Trust Fund. Just over 20 years ago, Florida’s Department of Transportation (FDOT) was financially debunked and as a result stopped all road construction projects. Times may have been hard then, but even more is on the line today.
Averting money from the STTF to the state’s general revenue coffers will not only freeze funding for any new road projects but also eliminate tens of thousands of road-building jobs. Last time I checked, lawmakers tasked to find ways to create jobs not eliminate them.
Since we can’t seem to learn from our past mistakes, perhaps lawmakers should turn their attention to other states who are feeling the effects of a nearly bankrupt Department of Transportation.
In New Jersey, things look rather bleak. Like Florida, unemployment numbers are high and legislators are hesitant to see the impacts of their position within the next year, let alone, next election cycle. The Philadelphia Inquirer reports the New Jersey’s Transportation Trust Fund, which (like Florida’s trust fund) bankrolls highway and transit projects statewide, is projected to hit the bottom in approximately 15 months. Reporter, Paul Nussbaum, explained “…after June 2011, all of the $895 million [that] annually flows to the fund from tolls, gasoline taxes, and sales taxes on other goods and services will be needed to pay the interest on borrowed money. No money will be available for projects. If the state trust fund runs out, that also could jeopardize the $1.6 billion in matching transportation funds New Jersey gets each year from the federal government.”
The full article continues to provide possible solutions for the northern state while Florida is facing the same debacle with no solutions being offered by lawmakers. What would become of our state if we continue down this path? The Senate seems to understand the impacts of 100,000 unemployed Floridians on our already weakened economy. It’s time for the House to follow suit.
Averting money from the STTF to the state’s general revenue coffers will not only freeze funding for any new road projects but also eliminate tens of thousands of road-building jobs. Last time I checked, lawmakers tasked to find ways to create jobs not eliminate them.
Since we can’t seem to learn from our past mistakes, perhaps lawmakers should turn their attention to other states who are feeling the effects of a nearly bankrupt Department of Transportation.
In New Jersey, things look rather bleak. Like Florida, unemployment numbers are high and legislators are hesitant to see the impacts of their position within the next year, let alone, next election cycle. The Philadelphia Inquirer reports the New Jersey’s Transportation Trust Fund, which (like Florida’s trust fund) bankrolls highway and transit projects statewide, is projected to hit the bottom in approximately 15 months. Reporter, Paul Nussbaum, explained “…after June 2011, all of the $895 million [that] annually flows to the fund from tolls, gasoline taxes, and sales taxes on other goods and services will be needed to pay the interest on borrowed money. No money will be available for projects. If the state trust fund runs out, that also could jeopardize the $1.6 billion in matching transportation funds New Jersey gets each year from the federal government.”
The full article continues to provide possible solutions for the northern state while Florida is facing the same debacle with no solutions being offered by lawmakers. What would become of our state if we continue down this path? The Senate seems to understand the impacts of 100,000 unemployed Floridians on our already weakened economy. It’s time for the House to follow suit.
Thursday, March 18, 2010
Not Down and Out: Floridians Jobs Too Important
We had the opportunity to speak with WTXL-ABC the other day as industry leaders prepared to speak in front of the House Committee on Transportation and Economic Development (TED) Appropriations. Reporter Jerry Hume addressed FTBA’s concerns regarding the Committee’s vote to move ahead with raids on the State Transportation Trust Fund (STTF) and the resulting impacts on jobs. You can view the story here http://bit.ly/apsO7a. Although Tuesday’s vote served a blow to the state’s transportation industry, we’re certainly not down and out – this is just the first step.
With a strictly party-line vote, the Committee passed legislation which would sweep $428 million from the STTF. Thanks to the support of Asphalt Contractors Association of Florida, Associated Industries of Florida, APAC-Florida (FTBA member), CW Roberts Contracting (FTBA Member), the Florida Chamber of Commerce, Florida Concrete & Products Association, Florida Engineering Society, Florida Ports Council, Florida Trucking Association and Florida TaxWatch, the consequences of a trust fund raid resonated with TED’s members.
It’s important to remember that this is only the first step in the legislative process and the fight isn’t over. With a record high unemployment number released last week, we cannot afford to push the jobless rate any further. It’s imperative that the main points below, stated at the hearing this week, resound with the House Appropriations Committee before they vote to include the sweep in the budget on Tuesday, March 23, 2010 at 11 a.m.
Jose Gonzalez, Associated Industries of Florida
“There has been a lot of talk nationally and here in Florida about what we can do to reverse the worsening unemployment rate. Regrettably, the STTF sweep would have the opposite effect and could possibly result in the loss of 100,000 jobs. For every $1 spent on road construction, $7 is returned to the economy.”
John Skidmore, APAC-Florida“
Since January of 2008, a lack of consistent work and revenue resulted in our company laying off nearly 550 employees. At best with current DOT funding levels, we expect to reduce our workforce by another 20 percent to 25 percent by year-end. That’s another 150 to 200 jobs and another 150 to 200 families without an APAC paycheck. It’s much more than a number in a budget allocation memo – for my family and the families of all APAC-Florida employees, it’s our livelihood.”
Gabe Sheheane, Florida Chamber of Commerce
“A congested road for Florida’s businesses equates to loss in productivity as well as increased operational costs. In Florida, the transportation industry has been an economic cornerstone and addressing the possible of a complete lack of funding for the Florida Department of Transportation is an issue that must be carefully reviewed not just swept under the mat.”
Frank Rudd, Florida Engineering Society
“Taking this money out of the trust fund and putting it into general revenue will dramatically transform the Department of Transportation’s work program for the next five years in the worst way possible for our industry. With no money to complete new, sustainable road building projects, you can guarantee close to 6,000 engineering jobs will be lost in the next year.”
Mike Rubin, Florida Ports Council
“This is not a deferral of money for transportation funding. This is money that is completely gone and will not be coming back once removed from the State Transportation Trust Fund. Projects that were slated to be built to better Florida’s intermodal transportation system will simply be deleted – these projects, and the jobs that support them, will not be coming back. Let’s trim responsibly with a fine-eye rather than an all-encompassing heavy-handed approach.”
Mary Lou Rajchel, Florida Trucking Association
“For every $1 billion invested by state governments on highway construction and improvements, more that 27,000 jobs are created. To help sustain Florida’s trucking industry, we need well-maintained roads that provide egress into communities big and small, so we can deliver food, products and goods people count on in their daily lives.”
With a strictly party-line vote, the Committee passed legislation which would sweep $428 million from the STTF. Thanks to the support of Asphalt Contractors Association of Florida, Associated Industries of Florida, APAC-Florida (FTBA member), CW Roberts Contracting (FTBA Member), the Florida Chamber of Commerce, Florida Concrete & Products Association, Florida Engineering Society, Florida Ports Council, Florida Trucking Association and Florida TaxWatch, the consequences of a trust fund raid resonated with TED’s members.
It’s important to remember that this is only the first step in the legislative process and the fight isn’t over. With a record high unemployment number released last week, we cannot afford to push the jobless rate any further. It’s imperative that the main points below, stated at the hearing this week, resound with the House Appropriations Committee before they vote to include the sweep in the budget on Tuesday, March 23, 2010 at 11 a.m.
Jose Gonzalez, Associated Industries of Florida
“There has been a lot of talk nationally and here in Florida about what we can do to reverse the worsening unemployment rate. Regrettably, the STTF sweep would have the opposite effect and could possibly result in the loss of 100,000 jobs. For every $1 spent on road construction, $7 is returned to the economy.”
John Skidmore, APAC-Florida“
Since January of 2008, a lack of consistent work and revenue resulted in our company laying off nearly 550 employees. At best with current DOT funding levels, we expect to reduce our workforce by another 20 percent to 25 percent by year-end. That’s another 150 to 200 jobs and another 150 to 200 families without an APAC paycheck. It’s much more than a number in a budget allocation memo – for my family and the families of all APAC-Florida employees, it’s our livelihood.”
Gabe Sheheane, Florida Chamber of Commerce
“A congested road for Florida’s businesses equates to loss in productivity as well as increased operational costs. In Florida, the transportation industry has been an economic cornerstone and addressing the possible of a complete lack of funding for the Florida Department of Transportation is an issue that must be carefully reviewed not just swept under the mat.”
Frank Rudd, Florida Engineering Society
“Taking this money out of the trust fund and putting it into general revenue will dramatically transform the Department of Transportation’s work program for the next five years in the worst way possible for our industry. With no money to complete new, sustainable road building projects, you can guarantee close to 6,000 engineering jobs will be lost in the next year.”
Mike Rubin, Florida Ports Council
“This is not a deferral of money for transportation funding. This is money that is completely gone and will not be coming back once removed from the State Transportation Trust Fund. Projects that were slated to be built to better Florida’s intermodal transportation system will simply be deleted – these projects, and the jobs that support them, will not be coming back. Let’s trim responsibly with a fine-eye rather than an all-encompassing heavy-handed approach.”
Mary Lou Rajchel, Florida Trucking Association
“For every $1 billion invested by state governments on highway construction and improvements, more that 27,000 jobs are created. To help sustain Florida’s trucking industry, we need well-maintained roads that provide egress into communities big and small, so we can deliver food, products and goods people count on in their daily lives.”
No "Hoarding" Here!
I continue to be amazed at comments made by members of the Florida House of Representatives when talking about the Florida Department of Transportation (FDOT) and the State Transportation Trust Fund (STTF).
This Tuesday, the House Transportation and Economic Development Appropriations Committee listened as speaker after speaker spoke in opposition to the sweeping of the STTF. Amazingly, after 2 hours of public testimony, no one spoke in favor of the sweep. The bill passed in a strict party-line vote with ten Republicans voting for the sweep and five Democrats voting against it. Even the legislators who voted for the sweep could offer nothing more than comments such as “I don’t want to do this...”, “We know this impacts jobs…” and others of a similar nature.
There continues to be a lot of confusion regarding the impact of the sweep but at least no one is denying that projects will have to be deferred. From that point on, however, accounts of the impact start to vary.
Here are several observations that I feel very comfortable stating as we look forward:
1. No Hoarding Here. If FDOT were “hoarding money” FTBA would be the first group to scream foul. We desperately need work and would not sit idly by if FDOT were stashing away money and not programming work in a financially responsible manner.
2. This Money will be Gone for Good. Once these transportation funds are swept, you can bet they won’t be paid back later. Projects will not be built. Look at it this way – if you lose your job and are out of work for a year, would you ever be able to make up the money you lost? The answer is a cold, hard no.
3. Let FDOT Manage Their Funds. The Department of Transportation manages cash as well or better than any government agency I know. After being burnt badly in 1989 by over committing on work, FDOT has made cash management a top priority. The massive sweep being proposed by the House would grind new construction projects to a halt. As a matter of fact - I would not be surprised to see FDOT cancel bid lettings until the final budget is approved.
4. FDOT Cash Will Fall Like a Rock. No matter what happens, the cuts already absorbed by FDOT means almost no capacity projects will be built in the foreseeable future. If this sweep holds up, FDOT cash will fall like a rock. There is no way they could bid new work. Their efforts will only focus on keeping current projects moving forward.
5. Roll Forward” does not = FDOT Cash. There have been mentions of $700-800 million of “roll-forward” funds in the FDOT budget. Unfortunately, the term “roll forward” only refers to budget authority – not cash. Whether it is federal earmarks, ROW acquisition, or preliminary project engineering, there is no actual cash. In simpler terms FDOT does not have an extra “stash of cash” somewhere. FDOT’s bank balance is their cash. The roll forward does not add one dime to the cash.
6. Federal Highway Dollars May be Lost. FDOT ‘s ability to front money on major projects, prior to receiving federal dollars for those projects, will further hamper Florida’s ability to begin any major transportation projects. In fact, for the first time ever, FDOT might be in a position toward the end of the budget year to lose federal highway dollars to other states. That’s no way to improve our federal rate of return.
7. House Position Puts Congressional Delegation in a Pickle. Our Congressional delegation will find it difficult to be motivated to help with transportation federal dollars given the Florida House position.
8. Financial Practices should be Uniform. Florida would be much better off if the financial practices put in place at FDOT were used throughout our local, state and federal governments. Again, as mentioned in point one, there is no “hoarding” at FDOT.
A lot of questions remain as the overall House Appropriations Committee prepares to meet next Tuesday. One thing is for sure however, the sweep will impact Florida’s ability to jump back into economic prosperity. Cutting jobs – thousands upon thousands of jobs – cannot be the answer.
This Tuesday, the House Transportation and Economic Development Appropriations Committee listened as speaker after speaker spoke in opposition to the sweeping of the STTF. Amazingly, after 2 hours of public testimony, no one spoke in favor of the sweep. The bill passed in a strict party-line vote with ten Republicans voting for the sweep and five Democrats voting against it. Even the legislators who voted for the sweep could offer nothing more than comments such as “I don’t want to do this...”, “We know this impacts jobs…” and others of a similar nature.
There continues to be a lot of confusion regarding the impact of the sweep but at least no one is denying that projects will have to be deferred. From that point on, however, accounts of the impact start to vary.
Here are several observations that I feel very comfortable stating as we look forward:
1. No Hoarding Here. If FDOT were “hoarding money” FTBA would be the first group to scream foul. We desperately need work and would not sit idly by if FDOT were stashing away money and not programming work in a financially responsible manner.
2. This Money will be Gone for Good. Once these transportation funds are swept, you can bet they won’t be paid back later. Projects will not be built. Look at it this way – if you lose your job and are out of work for a year, would you ever be able to make up the money you lost? The answer is a cold, hard no.
3. Let FDOT Manage Their Funds. The Department of Transportation manages cash as well or better than any government agency I know. After being burnt badly in 1989 by over committing on work, FDOT has made cash management a top priority. The massive sweep being proposed by the House would grind new construction projects to a halt. As a matter of fact - I would not be surprised to see FDOT cancel bid lettings until the final budget is approved.
4. FDOT Cash Will Fall Like a Rock. No matter what happens, the cuts already absorbed by FDOT means almost no capacity projects will be built in the foreseeable future. If this sweep holds up, FDOT cash will fall like a rock. There is no way they could bid new work. Their efforts will only focus on keeping current projects moving forward.
5. Roll Forward” does not = FDOT Cash. There have been mentions of $700-800 million of “roll-forward” funds in the FDOT budget. Unfortunately, the term “roll forward” only refers to budget authority – not cash. Whether it is federal earmarks, ROW acquisition, or preliminary project engineering, there is no actual cash. In simpler terms FDOT does not have an extra “stash of cash” somewhere. FDOT’s bank balance is their cash. The roll forward does not add one dime to the cash.
6. Federal Highway Dollars May be Lost. FDOT ‘s ability to front money on major projects, prior to receiving federal dollars for those projects, will further hamper Florida’s ability to begin any major transportation projects. In fact, for the first time ever, FDOT might be in a position toward the end of the budget year to lose federal highway dollars to other states. That’s no way to improve our federal rate of return.
7. House Position Puts Congressional Delegation in a Pickle. Our Congressional delegation will find it difficult to be motivated to help with transportation federal dollars given the Florida House position.
8. Financial Practices should be Uniform. Florida would be much better off if the financial practices put in place at FDOT were used throughout our local, state and federal governments. Again, as mentioned in point one, there is no “hoarding” at FDOT.
A lot of questions remain as the overall House Appropriations Committee prepares to meet next Tuesday. One thing is for sure however, the sweep will impact Florida’s ability to jump back into economic prosperity. Cutting jobs – thousands upon thousands of jobs – cannot be the answer.
Wednesday, March 10, 2010
FL House Proposes Huge Sweep of Highway Trust Fund
Bob Burleson gave testimony before before FL House Transportation and Economic Development Committee yesterday. Thanks to Keith Laing with the News Service of Florida for covering this important issue. The following article by The News Service of Florida highlights the testimony on the article below:
STATE CAPITOL BRIEFS – WEDNESDAY, MARCH 10, 2010
THE NEWS SERVICE OF FLORIDA
"TRANSPORT ADVOCATES UNHAPPY WITH HOUSE TF SWEEPS
Transportation advocates emerged from a meeting of the House Transportation and Economic Development Committee saying the panel’s plans to sweep millions of dollars from the transportation trust fund would put a roadblock on job growth in the state. Bob Burleson, president of the Florida Transportation Builders Association, said that the panel’s plan to take $428 million directly from the trust fund, which is used to fund road projects in the state, “dwarfs all the job-creating initiatives Legislature’s been talking about.” Calling it a “job killing initiative,” Burleson said the spending plan “would pretty much ensure DOT won’t be able to bid any new work. Basically all they can do is pay existing contacts.” Burleson said his organization was particularly unhappy that $150 million of the sweep would be in form of reinstituting a surcharge on the transportation fund that was eliminated years ago. “We hear a lot of talk around the Capitol that everybody has to share in the pain, which I agree with” he said. “Obviously I think entire state has shared in the pain these last few years, but the fact is that transportation kind of has our own automatic pain-giver: the Revenue Estimating Conference. We get automatic cuts, which have come through reductions in collections in gas tax and created a drop in the five year work plan of over $10 billion.” Burleson said the trust fund sweeps would cost the state between 80,000 and 100,000 jobs. "
STATE CAPITOL BRIEFS – WEDNESDAY, MARCH 10, 2010
THE NEWS SERVICE OF FLORIDA
"TRANSPORT ADVOCATES UNHAPPY WITH HOUSE TF SWEEPS
Transportation advocates emerged from a meeting of the House Transportation and Economic Development Committee saying the panel’s plans to sweep millions of dollars from the transportation trust fund would put a roadblock on job growth in the state. Bob Burleson, president of the Florida Transportation Builders Association, said that the panel’s plan to take $428 million directly from the trust fund, which is used to fund road projects in the state, “dwarfs all the job-creating initiatives Legislature’s been talking about.” Calling it a “job killing initiative,” Burleson said the spending plan “would pretty much ensure DOT won’t be able to bid any new work. Basically all they can do is pay existing contacts.” Burleson said his organization was particularly unhappy that $150 million of the sweep would be in form of reinstituting a surcharge on the transportation fund that was eliminated years ago. “We hear a lot of talk around the Capitol that everybody has to share in the pain, which I agree with” he said. “Obviously I think entire state has shared in the pain these last few years, but the fact is that transportation kind of has our own automatic pain-giver: the Revenue Estimating Conference. We get automatic cuts, which have come through reductions in collections in gas tax and created a drop in the five year work plan of over $10 billion.” Burleson said the trust fund sweeps would cost the state between 80,000 and 100,000 jobs. "
Thursday, March 4, 2010
FL Legislature: House Budget Allocations Say Transportation is not a Priority
The Speaker of the House, Larry Cretul, today released his budget allocations. These allocations prioritize education, health and public safety. It is hard to argue with those priorities but it falls short in omitting transportation. The allocations indicate a substantial cut to the FDOT work program. I wonder if the latest numbers from the Revenue Estimating Conference (released Monday night) have been taken into account?
The sweep of $200 million from the State Transportation Trust Fund (STTF) would literally bankrupt FDOT before Thanksgiving. All lettings would stop. We would not be able to draw down our federal dollars. Well, you say, in tough times we have to make tough decisions. Of course we do – but not crazy decisions. Think about this. Construction means jobs. Shut down construction and you shut down jobs- not only direct jobs on a construction project but a huge number of jobs from all areas that service working people.
The drop in FDOT work absent any cuts to the program would be over 40,000 jobs. Add to that another 50,000 plus jobs if shut down all together and you have a recipe for economic disaster! The unemployment and Medicaid costs will soar. Where will that money come from? Without a transportation program what little development we have will cease and with it all hope of a recovery. We will never have enough revenue.
I hear the talk of no tax or fee increases. It’s time to think about increasing user fees in all areas – not just transportation. These user fees need to be spent specifically for the purposes collected. These increases might actually increase growth and spending. The transportation industry must pull out all the stops. We cannot sit back and take this. This budget proposal in the House will not only destroy an industry; it will ruin our state. We cannot continue to punt our obligations down the field to our children and grandchildren. At some point we have to pay. Eventually even the government’s checks will bounce!
The sweep of $200 million from the State Transportation Trust Fund (STTF) would literally bankrupt FDOT before Thanksgiving. All lettings would stop. We would not be able to draw down our federal dollars. Well, you say, in tough times we have to make tough decisions. Of course we do – but not crazy decisions. Think about this. Construction means jobs. Shut down construction and you shut down jobs- not only direct jobs on a construction project but a huge number of jobs from all areas that service working people.
The drop in FDOT work absent any cuts to the program would be over 40,000 jobs. Add to that another 50,000 plus jobs if shut down all together and you have a recipe for economic disaster! The unemployment and Medicaid costs will soar. Where will that money come from? Without a transportation program what little development we have will cease and with it all hope of a recovery. We will never have enough revenue.
I hear the talk of no tax or fee increases. It’s time to think about increasing user fees in all areas – not just transportation. These user fees need to be spent specifically for the purposes collected. These increases might actually increase growth and spending. The transportation industry must pull out all the stops. We cannot sit back and take this. This budget proposal in the House will not only destroy an industry; it will ruin our state. We cannot continue to punt our obligations down the field to our children and grandchildren. At some point we have to pay. Eventually even the government’s checks will bounce!
Wednesday, March 3, 2010
FL Legislature – Transportation Construction Essential Budget Priority
There is no question 2010 will be a tough budget year in Florida. Unfortunately, 2011 and 2012 look worse because we have no federal stimulus dollars to fall back on in those years.
All the talk at the Capitol is about “making the tough choices,” setting priorities, and cutting wasteful spending, and creating jobs. There is certainly nothing wrong with that. Sometimes it seems that few meaningful cuts are really made. It is more like a shell game where we simply take money from one pot (trust funds) and put it in another pot (general revenue). Essentially we are just kicking the can down the road. While small, the transportation portion of the stimulus was a life-saver, providing both jobs and much needed projects. Next year we don’t have that benefit.
Marion Hammer, former NRA President, gave excellent testimony in House Education and Economic Development Appropriations yesterday on trust funds. Fees collected for a specific purpose should be used for that purpose. When fees collected for a specific purpose are diverted to General Revenue and not used for their intended purpose they become a tax. I could not agree more with Ms. Hammer.
The bill under consideration in committee, HB 651, places the trust fund for license fees for concealed weapons into an existing statue protecting certain trust funds. It prohibits taking money from those funds for other than their intended purpose.
Guess what other trust fund is already in the law? You guessed it – the State Transportation Trust Fund. Funny how that works. The Legislature conveniently sidesteps the law by prefacing the sweep of a protected trust fund by the words, “Not withstanding any other provision of law”. Too bad we cannot all do that in our own businesses when we don’t wish to follow a law.
Funding issues became a little tighter Monday night when the revenue estimating conference cut $75 million from the current (09-10) revenue estimate for transportation (gas tax, tag & title fees) collections. This is $75 million less cash FDOT will have to finish the fiscal year. That means some projects will be cut in the current year’s work program. FDOT is busy trying to update its work program. Next year’s estimate is even worse; an additional $82 million is cut by the REC. In effect we just had a $150 million “sweep” without the legislature doing a thing! We are just collecting less money than previously estimated.
This is horrible news for not only the transportation construction industry and the citizens of Florida; but, also, for the Legislature. For us it means less work and fewer jobs. For the legislature it means the State Transportation Trust Fund cookie jar just became nearly empty!
Stay tuned – this is going to get very interesting-
All the talk at the Capitol is about “making the tough choices,” setting priorities, and cutting wasteful spending, and creating jobs. There is certainly nothing wrong with that. Sometimes it seems that few meaningful cuts are really made. It is more like a shell game where we simply take money from one pot (trust funds) and put it in another pot (general revenue). Essentially we are just kicking the can down the road. While small, the transportation portion of the stimulus was a life-saver, providing both jobs and much needed projects. Next year we don’t have that benefit.
Marion Hammer, former NRA President, gave excellent testimony in House Education and Economic Development Appropriations yesterday on trust funds. Fees collected for a specific purpose should be used for that purpose. When fees collected for a specific purpose are diverted to General Revenue and not used for their intended purpose they become a tax. I could not agree more with Ms. Hammer.
The bill under consideration in committee, HB 651, places the trust fund for license fees for concealed weapons into an existing statue protecting certain trust funds. It prohibits taking money from those funds for other than their intended purpose.
Guess what other trust fund is already in the law? You guessed it – the State Transportation Trust Fund. Funny how that works. The Legislature conveniently sidesteps the law by prefacing the sweep of a protected trust fund by the words, “Not withstanding any other provision of law”. Too bad we cannot all do that in our own businesses when we don’t wish to follow a law.
Funding issues became a little tighter Monday night when the revenue estimating conference cut $75 million from the current (09-10) revenue estimate for transportation (gas tax, tag & title fees) collections. This is $75 million less cash FDOT will have to finish the fiscal year. That means some projects will be cut in the current year’s work program. FDOT is busy trying to update its work program. Next year’s estimate is even worse; an additional $82 million is cut by the REC. In effect we just had a $150 million “sweep” without the legislature doing a thing! We are just collecting less money than previously estimated.
This is horrible news for not only the transportation construction industry and the citizens of Florida; but, also, for the Legislature. For us it means less work and fewer jobs. For the legislature it means the State Transportation Trust Fund cookie jar just became nearly empty!
Stay tuned – this is going to get very interesting-
Monday, March 1, 2010
Florida Legislators: It’s All about Jobs!!
With Florida’s unemployment rate approaching 12%, all the talk in Tallahassee is about creating jobs as it should be. Transportation construction is one of the best job creators we have. Every $1 Billion in transportation construction spending creates 28,000 jobs.
Not only does it create jobs, but we are investing in our future. We need to seriously improve our infrastructure. Transportation spending is one of the few tangible results we see from our tax dollars. I see this as a win-win for everyone. We create good, well-paying jobs and improve Florida’s transportation system at the same time.
The Florida’s Legislature is proposing massive sweeps to the State Transportation Trust Fund (STTF). The sweeps are a job wrecker! Here’s a news flash: In 2010-2011, FDOT will put out for bid $1.5 Billion of transportation construction work, a dramatic 50% drop from the average $3 billion put out for bid in the previous 5-6 years. The amount would have fallen in 2009-2010 but the stimulus spending on infrastructure saved us.
If the Legislature does not sweep any money this year transportation work still falls $1.5 Billion, which translates to 42,000 jobs!! Why do you suppose no one in the Legislature seems to grasp this? Those layoffs create huge jumps in unemployment claims and Medicaid claims.
The best job creation opportunity is looking the Legislature right in the face. It is time for real leadership on this issue. It is all about the jobs!
Florida Legislators: Don’t Touch the Transportation Trust Fund
The 2010 Florida Legislative session begins this week. The challenges have never been higher for Florida transportation stakeholders. The budget deficit makes our State Transportation Trust Fund (STTF) an easy target. Lawmakers cannot help but eye the "big pot" of money in the STTF.
Is it really a "big pot" of money? History demonstrates it clearly is not. Let's take a stroll down memory lane. In 1989 the FDOT had a serious cash crisis, leading many to describe it as the time "FDOT went broke". Contracts were cancelled, payments to contractors were delayed, contract lettings came to a grinding halt and massive layoffs occurred. This happened because government leaders felt FDOT had a huge surplus of cash that needed to be spent down. To their credit in 1989 the spending was at least directed to transportation and not General Revenue. In 1989 FDOT had approximately $180 million in the bank before the big spend down. At that same time FDOT had commitments (owed contractors) $744 million. The ratio of cash to commitment was roughly 4 to 1. FDOT always owes more than it has on hand because jobs pay out over months and years, not all at once. The ratio of 4 to 1 was enough to cause financial chaos at FDOT and create a large slowdown in construction.
Let's fast forward to 2010. FDOT has approximately $600 million in the bank but owes $100 million of that to GR before the end of the year as part of last year's budget "sweep" of the trust fund. In effect we have $500 million in the trust fund. FDOT's current commitments exceed $6 Billion. That's cash to commitment ratio of 12 to 1! Do you still think FDOT has a surplus? The answer is clearly no.
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