Who is a member?
Our members are the local governments of Massachusetts and their elected and appointed leadership.
The Honorable William M. Straus, House Chair
The Honorable Thomas M. McGee, Senate Chair
Joint Committee on Transportation
State House, Boston
Dear Chairman Straus, Chairman McGee, and Distinguished Committee Members,
On behalf of the cities and towns of the Commonwealth, the Massachusetts Municipal Association deeply appreciates the opportunity to offer testimony at today’s Joint Committee on Transportation hearing on House Bill 3327, An Act Financing Improvements to the Commonwealth’s Transportation System, submitted by the Patrick-Murray Administration for your consideration. The MMA strongly urges you to pass a comprehensive transportation finance reform package as soon as possible. State and local officials and stakeholders know the depth of the problem: We face a massive funding gap to maintain our existing infrastructure and lack the ability to expand our system in important ways to invest in our future.
We strongly support House Bill 3327 and were encouraged by Speaker Robert DeLeo’s announcement that the House will act very shortly on a statewide transportation package to solve the fiscal challenges facing the system and to address the repair and maintenance challenges facing our highways, roads, and public transit systems in every corner of Massachusetts. We ask that this package be large enough to fix our broken transportation system, including a $100 million increase in Chapter 90 funds for local roads, as well as appropriate increases for regional transit systems, the statewide road and bridge program, and other well-documented needs. If the final legislation falls short of the magnitude needed, estimated to be at least $800 million a year, then too much of this needed investment will be delayed too far into the future.
Transportation Tax Revenues are Necessary to Invest in Our Economy, to Repair our Crumbling Infrastructure, and to Save Money
The MMA and local leaders across the state are members of the broad public, private, civic and business coalition calling for a comprehensive transportation finance plan that addresses state and local needs, and we support the tax and fee revenues and management reforms necessary to enact that plan, recognizing that the entire Commonwealth will benefit greatly from increased revenues to invest in local and state roads and highways, and regional and public transit systems.
The state Transportation Finance Commission projected a funding gap of $15 billion to $19 billion over the next 20 years just to maintain our current state and local transportation infrastructure, not including sorely needed improvements and expansions. A solid, well-financed, multi-modal transportation system will save taxpayers much more in the long run, because maintaining our infrastructure in good condition is up to 10 times less expensive than paying for the major repairs and reconstruction forced by neglect and poor upkeep. Further, modern and well-maintained roads, bridges and transit systems are essential in order to attract and keep families and businesses in the state, foster economic development and investment in our communities, create jobs, ensure public safety, and build a higher quality of life for our residents.
The Need for a $300-Million-a-Year Chapter 90 Program is Well Documented
As you know, cities and towns are responsible for 30,000 miles of roads in the Commonwealth – approximately 90 percent of our state’s roadways – and communities depend on the Chapter 90 reimbursement program to maintain and repair their roads, making Chapter 90 a vital element in any transportation funding plan. The state created the Chapter 90 program in 1973 to share a portion of gas tax revenues with communities to ensure adequate resources for local road construction needs. But 40 years later, even at $200 million a year, funding for the Chapter 90 program is far short of the actual need, because construction costs have escalated sharply over the decades, in great part due to significant increases in the cost of fossil fuels, which drives up the price of construction materials such as asphalt and steel.
In December 2012, the MMA released a report documenting that cities and towns across the state face an annual shortfall of $362 million in the funding needed to maintain municipal roadways in a state of good repair, the industry standard for ensuring well-maintained roads in good condition. (A copy of the report was delivered to the Committee when the MMA testified on March 12.) To close a portion of this huge gap, the MMA and local officials from across Massachusetts have called for funding the Chapter 90 program at $300 million a year.
Specifically, we urge you to enact at least a five-year Chapter 90 bond bill with $300 million in annual baseline funding, indexed to grow with the CPI each year. The governor's bill offers a 10-year plan following this framework, providing a total of $3.4 billion over 10 years, using an annual inflation rate of 2.5 percent. The multi-year duration is necessary to provide predictability and stability, allowing communities adequate time for planning, instead of lurching year-to-year with one-year commitments on Chapter 90. The governor’s 10-year duration would be ideal, and a five-year bill would be a major improvement over the much shorter durations that have been in place for many years. Indexing the program to the CPI is necessary to ensure that communities do not lose purchasing power over time. This investment is essential for the state’s economic future and necessary to save taxpayers millions of dollars in more costly projects when roads fail.
The MMA collected data from cities and towns across the state, and that information revealed that communities in Massachusetts need to spend $562 million every year to rebuild and maintain local roads in a state of good repair, but communities spend far less because of inadequate resources and because, for most localities, Chapter 90 is the only source of funds for road maintenance. Under Proposition 2½, cities and towns are unable to increase the amount of local funds to supplement Chapter 90 unless they cut other important services such as public safety or education, or pass a tax override, increasing local reliance on the already overburdened property tax. The result is seen in potholes and crumbling roads across the state.
Chapter 90 is the Best Vehicle For Regional Equity and Immediate Results Across the State
In addition, increasing Chapter 90 to $300 million a year will yield immediate benefits and address a major goal of transportation reform: regional equity. We applaud the speaker’s commitment to this fundamental aspect. The Chapter 90 program is the most effective and efficient way to ensure regional equity and regional access to increased transportation tax revenues. Cities and towns receive their funds through a tried-and-true formula that shares revenues in a fair way in every corner of the Commonwealth. Plus, cities and towns face such a backlog of need that the increase will immediately result in visible and necessary construction and repair projects on local roads across Massachusetts.
Further, our report demonstrates that investing more in Chapter 90 funding to improve the quality of local roads will actually save taxpayers millions of dollars a year. According to the U.S. Department of Transportation, once a local road is in a state of good repair, every dollar invested to keep it properly maintained will save $6 to $10 in avoided repair costs that become necessary to rebuild the road when it fails due to a lack of maintenance.
Now is the Time to Pass Transportation Finance Reform
We are very pleased the Joint Committee on Transportation has acted so quickly to consider H. 3327. Under state law and custom, cities and towns are supposed to receive formal notice of their Chapter 90 allocation by April 1 of each year, allowing for adequate time to plan and use their Chapter 90 funds during the entire construction season. The MMA applauds the commitment to retaining the April 1 statutory notification date that is included in H. 3327, and we ask you to incorporate this essential commitment in the legislation that you report to the full Legislature. Communities cannot sign contracts or borrow against their Chapter 90 funds until they receive these April 1 letters of authorization from the state. For the past two years, the state has not passed the Chapter 90 bond and terms bills until well into the summer, and cities and towns have only received preliminary letters that did not become official until the legislation was signed into law. This unfortunate delay stalled projects and dramatically shortened the 2011 and 2012 construction seasons for every community across the state. When the construction season is shortened, important projects are delayed until the next year, driving up costs and adding to the deterioration of local roads.
With April 1 a week away, we respectfully urge the Legislature to swiftly enact a comprehensive transportation improvement and financing package, including the increased Chapter 90 bond authorization. Communities are depending on passage of this vital legislation now, so that the important work of rebuilding and restoring our roads, bridges and infrastructure can begin now, and so that they can make full use of the entire 2013 construction season.
Summary
Cities and towns look forward to standing with you and your colleagues as partners in addressing the state’s transportation finance crisis and providing adequate revenues and resources to invest in our crumbling roads and bridges, and transit systems all across the state. The future of our Massachusetts economy will depend on a solvent and modern transportation system, of which Chapter 90 is a part, and this is a major goal that can be achieved with strong state-local collaboration. We look forward to working in partnership with you in the weeks ahead.
Sincerely,
Geoffrey C. Beckwith
Executive Director, MMA