DOT holes have not magically been filled

Given that Transportation funding is going to be a big item of discussion in this year's Wisconsin budget debate, let's look at what Gov Scott Walker's budget says regarding the plans for highway spending for 2017-19. In this document, SEG is Transportation Fund dollars (from the gas tax, vehicle registration, other DOT-related sources), and SEG-F is federal highway spending.

The Governor recommends providing $121,943,200 in total funding over the biennium for the southeast megaprojects program. This funding includes: (a) $11,488,300 SEG in FY18 and $15,721,800 SEG in FY19; and (b) $59,745,000 SEG-F in FY18 and $34,988,100 SEG-F in FY19.

The Governor also recommends providing $669,865,500 in total funding over the biennium for the major highway development program. This funding includes: (a) $129,126,800 SEG in FY18 and $23,820,900 SEG in FY19; (b) $160,309,900 SEG-F in FY18 and $203,326,200 SEG-F in FY19; and (c) $82,632,700 in FY18 and $70,649,000 in FY19 in transportation revenue bonds. In addition, the Governor recommends deleting from the statutes the following completed majors projects: (a) USH 53; (b) the Rock County transportation plan; (c) STH 64 and (d) USH 12.

The Governor further recommends providing $1,705,750,800 in total funding over the biennium for the state highway rehabilitation program. This funding includes: (a) $278,933,200 SEG in each fiscal year, (b) $2,059,200 SEG-L in each fiscal year, (c) $417,883,000 SEG-F in FY18 and $417,144,700 SEG-F in FY19, and (d) $152,238,300 in FY18 and $156,500,000 in FY19 in transportation fund-supported general obligation bonds.

Sounds impressive, but let's compare those figures with the 2017-19 request, which also has the base spending figures that this budget was based off of.

State Highway Rehabilitation
SEG
-$11,452,400 vs base each year,

-$225,000 vs 2017-18 request
-$175,000 vs 2018-19 request

SEG-F
-$50,974,900 vs base in FY18
-$51,613,300 vs base in FY19
funding same as budget request each year

Borrowing
$233,738,300 above base over the 2 years
Same as in request

Major Highway Development
SEG
+$60,714,900 vs base in FY 18
-$44,609,000 vs base in FY 19

+$101,792,400 vs request in FY 18
same as base in FY 19

SEG-F
+$52,772,900 vs base in FY 18
+$95,789,200 vs base in FY 19

+$3,000,000 vs request in FY 18
+$3,000,000 vs request in FY 19

Borrowing
-$124,284,900 vs base over the 2 years
same as request

SE Wis. Freeway Megaprojects
SEG
-$3,615,300 vs base in FY 18
+$658,200 vs base in FY 19
same as request

SEG-F
+$59,643,900 vs base in FY 18
+$34,887,000 vs base in FY 19
same as request

TOTAL HIGHWAY SEPNDING

SEG
+$46,589,000 vs base in FY 18
-$54,483,400 vs base in FY 19

+$101,771,400 vs spending FY 18
same as request in FY 19

SEG-F
+$61,797,700 vs base in FY 18
+$79,318,800 vs base in FY 19

+$3,000,000 vs base in FY 18
+$3,000,000 vs vase in Fy 19

Borrowing
+$109,453,400 vs base over the 2 years
Both years same as request

I guess it's a little more highway spending, and $104.7 million more than the request, but not exactly much different than we already knew. So how in the world does this somehow get rid of multi-year delays that were planned in the request for projects such as I-39/90 and Verona Road, with an overall increase in highway spending of barely more than 8% over that request? The only way I can think that'll happen is by doing this.



Just because you say something's going to be fixed, it doesn't mean it will. The recent LAB audit which showed over $3 billion in overspending on Wisconsin highways still needs to be reckoned with, and remember what the LAB said was a big reason behind those overruns.

We found that DOT’s cost estimates at enumeration were incomplete. We note that 13 of the 19 projects took 18 years or more for DOT to incur all expenditures, and the effects of inflation on project expenditures can be significant over time. Nevertheless, none of the cost estimates for the 19 projects took into account that inflation would increase project costs over time, although cost estimates for all 19 projects indicated that inflation was excluded from them. In addition, DOT indicated that its cost estimates for projects enumerated before 2011 typically excluded design engineering, construction engineering, and certain other project-related costs.

As shown in Table 6, the estimated expenditures for 19 major highway projects completed from January 2006 through December 2015 were a total of $772.5 million higher than the cost estimates DOT had provided to the Governor and the Legislature at enumeration. Expenditures for all 19 projects increased from DOT’s cost estimates, including expenditures for 10 projects that each increased by more than 100.0 percent from DOT’s cost estimates.

And that proposed 8% increase in highway funding over the next 2 years is barely above the rate of inflation. So with that in mind, I expect some extra questions over these projected costs as the DOT's budget is debated in the coming months, and a realization that we don't have enough to get those jobs done over the next 2 years.

Reading the request also shows a problem with the numbers in Walker's budget, because they didn't count the nearly $309 million in borrowing that was planned for highway rehab. I expect that to be corrected in the errata document (aka the "Oops! We fucked up!" doc) that'll come out in the next few weeks. Hopefully, it won't be as bad as the one 2 years ago, which had well over 100 screw-ups from the Walker Administration. It's not going to change the General Fund situation, but it might change the Transportation Fund a bit, since some of that new debt is going to have paid off in the next 2 years, and a lot more in the future.

There also is no other permanent revenue source added into the budget that's going to pay for all of these needs, either now or in the future. Which means Walker has simply done nothing in this budget other than throw a few symbolic moves in, and is basically going to leave the heavy lifting to the Legislature. LEADERSHIP! UNINTIMIDATED!

Which means we gotta keep our eyes on the GOP-run Legislature as it meanders between Joint Finance and both houses, since the Transportation Fund still is ridden with (pot)holes, and what ultimately is decided seems to be the biggest item in this budget. And you can bet that if there is any kind of real action, it'll be snuck in as a late-night, once-read motion, because no one is going to want to do (and "take credit" for) the real work that goes into solving this very real problem of a lack of money available to fix the roads.