Roads and taxes: Some say amount collected isn't being spread around fairly
By Scott Jenkins
A Raleigh-based transportation planning group says most counties — including Rowan and Cabarrus — are getting less in transportation spending than their residents are paying in taxes.
The Capital Area Metropolitan Planning Organization has asked the state auditor to review how the N.C. Department of Transportation distributes federal and state roads money.
According to estimates compiled by the organization, Rowan County generated about $38.5 million annually in motor fuel and highway use taxes from 1991 to 2005 but got back a little less than $31 million a year in Department of Transportation spending. That’s a return of about 80 cents for each $1 paid in taxes.
During the same period, Cabarrus County generated about $41.5 million a year in taxes and received $2.7.2 million in annual spending for a return of nearly 66 cents on the dollar.
Tom Huntley, a Harrisburg town councilman and chairman of the Cabarrus-Rowan Metropolitan Planning Organization, said his board has heard some of the figures before, but the study puts them in stark relief.
“These figures are … pitiful,” Huntley said. “We’ve got big needs in both counties that aren’t being met. Where is our money going?”
According to the study, some counties get back far more than they pay into the system. The biggest beneficiaries appear to be rural counties in the mountains and at the coast. At the extreme are Madison County, on the Tennessee border, which gets back nearly $5.50 for every dollar its residents pay and coastal Tyrrell County, which receives just over $5 for each dollar in taxes paid.
The Raleigh organization compiled the figures by adding each county’s reported highway use tax collections — 3 percent of car sales taxes — to estimated state and federal motor fuel taxes. Fuel taxes are not collected at the county level so the agency based those figures on state counts of vehicle miles traveled in each county and average fuel consumption rates.
Ed Johnson, director of the Capital Area Metropolitan Planning Organization, said his agency performed the study after Wake County officials “seized on the notion there were counties in the state that were contributing a lot more than they were getting back.”
It’s already known, he said, that North Carolina is a “donor state,” sending more money to the federal government than it gets back in transportation funding, so it’s no surprise there are “donor counties.” In addition, the state routinely transfers money from the Highway Trust Fund to the General Fund.
But he said the Department of Transportation has used different approaches in recent years in explaining how it allocates the money it has for road projects.
“We want to see the numbers they’re coming up with and how they’re getting them,” he said.
Ernie Seneca, a spokesman for the Department of Transportation, said not all of the agency’s costs are allocated on a county level, “so I don’t know where these costs have come from. We’re dealing with statewide programs here for such things as environmental permitting, for instance.”
As for the highway funds, Seneca said there are “significant transportation needs across the state, both in urban and rural areas, and we are working hard to best meet them.
“We are following legislatively mandated guidelines for fund distribution and those spell out that the money is available to the 14 highway divisions and then the local officials help determine what their priority projects are,” he said.
Highway funding in North Carolina is determined largely by the state’s “equity formula,” which dictates allocations partly by population and partly by unfinished interstate miles approved for construction in 1989, when the General Assembly approved the Highway Trust Fund bill.
Johnson said environmental issues have prevented construction in some areas, but haven’t stopped those unfinished miles from being counted for ongoing allocations. Still, he said, the equity formula “is what it is” and the study is not meant to challenge it.
“This analysis is not to say the equity formula is fair or unfair, but to say since it was put in place in 1989 or ’90, here’s what happened,” Johnson said. “It just concerns me that we’re not meeting our needs.”
Many local leaders have long derided the state’s equity formula as an “inequity formula” that does not account for pressing needs that, if met, would benefit the entire state.
Huntley cited the Yadkin River bridge replacement and Interstate 85 widening in Cabarrus County as examples. The I-85 bridge spanning the Yadkin in Rowan is 50 years old and regarded by many as one of the most dangerous in the state, yet its replacement was pulled from an earlier highway improvements plan and the project remains unfunded in the current state plan, which runs through 2013.
And the interstate in Cabarrus County runs four lanes between widened portions in southern Rowan and just south of Concord Mills, creating a bottleneck on the main highway leading to the gigantic mall, the state’s top tourist destination last year.
Huntley said he’ll probably bring up the Raleigh organization’s study at the local group’s next meeting in February. He said it’s “very viable” the Cabarrus-Rowan group could join the call for the state to audit the way the funding formula is applied, though he did not want to speak for the entire board.
“We want to pursue what we can do in any way to try to get some funds moving” on Cabarrus and Rowan transportation projects, he said. “No one was happy at the last meeting at the state we’re in.”
According to the Raleigh organization’s study, the amount other area counties get back for every dollar their citizens pay in transportation taxes, rounded to the nearest penny: Davidson, 58 cents; Davie, 53 cents; Stanly, 91 cents; Iredell, 46 cents.
Contact Scott Jenkins at 704-797-4248 or firstname.lastname@example.org.