Among the signature elements of the long-running show Survivor are the exotic, far-flung locales where the battles of personal endurance and gamesmanship take place.
This year, the infrastructure version of this scenario is being played out at nearly every state capitol in the country as legislators confront a seemingly endless cycle of downsized revenue projections and increased budget deficits.
One would think that state lawmakers would already be experts at hacking their way out of deficit jungles. In their biannual report, The Fiscal Survey of States, the National Governors Association and the National Association of State Budget Officers reported that states closed $72.7 billion in budget gaps during fiscal 2009, and $113.1 billion before the enactment of their fiscal 2010 budgets to bring them into balance with drastically declining revenues.
The report notes that a few brave states dared to raise taxes and fees, netting $23.8 billion along with additional increases in other revenue measures of $7.7 billion for FY 2010.
But there’s still plenty of pain to come. The National Council of State Legislatures notes that 35 states and Puerto Rico currently project a cumulative budget gap of $55.5 billion in FY 2011. Twenty-three states and Puerto Rico currently project a $68.8 billion budget gap for FY 2012.
The fact that state revenue cycles typically lag behind broader economic trends by two years, even the most optimistic forecasts of recovery would still leave most states confronting a financial abyss well into the decade.
A common element of each state’s transportation survival strategy has so far been a call for more federal help. While there is talk of a “stimulus 2.0” bill this year, most observers at last week’s Transportation Research Board conference consider it little more than a band-aid. A new multi-year TEA-acronymed funding package is the more urgent need, but few see any chance of such a measure materializing until after the November elections at the earliest.
That leaves states to fend for themselves, using their collective wits to keep their emaciated transportation programs upright. With many state legislators also due to face voters later this year, many will likely opt to make more cuts in projects and people than even hint at tax increases.
A quick look at conditions in several mid-Atlantic states illustrates how dealing with this challenge will make building makeshift shelters or improvising a fishing lure seem like child’s play.
In Virginia, which faces a $4.2 billion funding gap over the next two years, has erased dozens of projects from its six-year transportation plan and eliminate 7,500 VDOT positions. Incoming governor Bob McDonnell proposed adding tolls to some interstates and selling off state-run liquor stores in order to generate some quick road-building cash.
However, the Washington Post reports that transportation will not be among McDonnell’s priorities for this session of the General Assembly, as had been promised during the campaign, perhaps out of concern that other initiatives might get bogged down in the funding gridlock that has kept the issue in limbo for several years. A special legislative session devoted to transportation may be in the works for later this year.
Maryland, which is trying to narrow a $2 billion this year, has long touted the slot machine revenue as a sure-fire source of state and local government funds. Despite the promise of new jobs and other economic benefits as part of the bargain, however, most localities remain wary of having new casinos in their backyards.
Yet even amid these gloomy predictions, the consensus seems to be that the situation is not hopeless. The rescue ship or helicopter will eventually appear on the horizon bearing a revived economy, more tax revenues, and perhaps even a new TEA.
The question is, will there be anyone left to spend it.