New York continues to divert money in the Dedicated Highway and Bridge Trust Fund for non-capital purposes, increasing the chances that critical highway and bridge projects will be skipped or delayed as the state faces fiscal challenges and shrinking debt capacity, according to a report today from state Comptroller Thomas DiNapoli.
The trust fund was created in 1991 to provide dedicated funding for rebuilding, replacing and preserving highways and bridges in the state. It is funded by special taxes and fees, including a gas tax, petroleum business tax, vehicle licensing fees and rental car tax. But by 2002, debt payments had surpassed capital projects. In the 2012-13 fiscal year, just 22.2 percent of the $3.8 billion disbursed from the fund was spent on capital construction, DiNapoli found.
“Taxpayers have paid billions in taxes and fees into a fund that was created to keep our roads and bridges in good repair. Now, more than three-quarters of this money is siphoned off to pay for borrowing and operating costs of state agencies, leaving fewer dollars for improving our infrastructure,” DiNapoli said in a statement. “While the state is making progress with its capital planning, New York needs a reliable source for investment in its transportation infrastructure and should restore the use of this fund for capital purposes.”
DiNapoli previously pointed out these problems with the Dedicated Highway and Bridge Trust Fund in a 2009 report, which concluded that the fund had shifted from a capital support program to a broader transportation program.
The decline in cash support for New York’s highway and bridge program has continued since the Comptroller’s 2009 report, which found that the fund had shifted from support for the capital highway and bridge program to a broader transportation program. Since the fund was created through the 2012-13 fiscal year, capital spending totaled $14.5 billion, just 30.6 percent of all disbursements, the report said.
Nearly $1.6 billion of the money spent from the trust fund in the last fiscal year paid for snow and ice removal by the state Department of Transportation and day-to-day expenses in the Department of Motor Vehicles. Staff expenses and snow and ice removal costs typically are considered state operations and maintenance costs, not capital expenses, DiNapoli’s report said.
Gov. Andrew Cuomo’s proposed budget for the 2014-15 fiscal year would increase slightly the portion of capital disbursements to 23.5 percent, but combined debt service and operations spending would continue to account for more than three-quarters of all fund spending.
Some state debt is appropriate for the trust fund, but it becomes a burden when debt service payments become such a large use of the fund, the report found. In the 2012-13 fiscal year, debt service was 40.7 percent of all fund disbursements.