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April 11, 2015

Paying for Malloy's $100 Billion Wish List

There is no question that Governor Malloy’s proposed $100 Billion transportation plan for our state is, as he puts it, “bold”.  The question is, is it achievable?  When asked which projects are important and should be prioritized, he insists it’s “all of them”.
Really?  Is turning little Oxford Airport into an international terminal, just 58 miles from Bradley, as important as fixing Metro-North?  Can we really spend $780 million on bike and
The 118 yr old Walk Bridge
pedestrian thoroughfares when we don’t have money to repair crucial bridges on the New Haven line?  And is spending $1.6 billion to widen I-95 from Stamford to the NY state line even necessary?
The problem is, the Governor’s plan isn’t a plan.  It’s a wish list, with something for everyone in the state.  His “plan” is of unknown origin.  Nobody has vetted these projects to say what makes sense and what doesn’t.  Nor has the Governor offered any ideas on how to pay for them. Instead he’s created a panel of experts tasked with coming up with those answers by the end of this summer, an unenviable job indeed.
As my Daddy taught me, “there is no free lunch”.  And there is no way to pay for any of these projects without significant pain.  A $100 billion plan would cost each man, woman and child in this state $27,800 to pay for it.  Even spread over 50 years, that’s $556 per person per year.  Are you in?
Even the Governor admits that highway tolls wouldn’t be enough, covering only one-third of the total cost.  And we know how popular tolling is.  So where else do we get the money?
Among the alternatives… a sales tax increase, higher gas taxes and real estate transfer fees.  Anything on that list to your liking so far?
How about “privatization”, in effect selling off state-owned roads and bridges to private companies, allowing them to charge whatever they’d like to use them?
Is it just by chance that this alternative is being floated by former Malloy campaign manager
Occhiogrosso & The Governor
and top aide Roy Occhiogrosso 
who just happens to now be working for a firm, HNTB Corp,  that specializes in such deals?  What does Mr. Occhiogrosso know about the Governor’s plans that we don’t, but should?
Privatization has been tried before.  In 2006 cash-strapped Indiana sold its 50-year-old East West Toll Road (“The Main Street of the Midwest”) to an Australian–Spanish conglomerate, netting the state $3.8 billion in return for the right to operate the crucial highway for 75 years. (PS:  Goldman Sachs earned a reported $200 million just for brokering the deal.)   In the first year of operations, tolls almost doubled. Surprised?

Let’s face it:  Governor Malloy is very shrewd.  He gets to look like Santa Claus, dolling out transportation goodies across the state while being able to blame his financing strategy team for assigning the costs.  This entire debate warrants very close scrutiny because, whatever its outcome, we will all be paying for it for many years.

2 comments:

mtaHarlemLine said...

He must have a money tree on his lawn. I'd like one too.

Christopher Parker said...

I've just been reading the last three comments on your blog and am struck by how they relate.

Your previous post had you saying you would happily pay a bit more than $500 for a lovely transcontinental flight. I'm struck by how similar that amount is to the annual bill for Governor Molloy's transportation plan. Would you happily pay that amount for a really measurable boost in your local transportation experience?

Of course it all comes down to the value of what you get under the Governor's plan, but I can't help being struck by the parallel here between the two posts. It seems that - for you - this is an amount of money worth paying *when the benefit is real*.

In the post before that one you write about transit oriented development. In this post you ask where the money is coming from for this plan . . . I think you have one answer in the transit oriented development post. In some places, transit is paid entirely by adjunct development.