Monday, June 12, 2017

No taxes + no fees = spending cuts and long waits for Wis highway work

Driving back from a family wedding yesterday, as soon as I hit the state line and saw the "Open for Business" sign, I felt the THUMP that told me I was back onto Wisconsin's battered highways. With that in mind, I wanted to dig more into the state's transportation funding issues, and particularly look into the DOT's highway program. Scott Walker claims that there are no delays imposed as part of his budget, but what he's not telling Wisconsinites is that those projects were delayed last year, and there's much less spending than we had 8 years ago due to a lack of resources.

Yes, there is $145 million scheduled to be carried over on July 1, and $101 million in cushion for the 2017-19 budget. But do not forget some of that is due to the Walker’s Administration choosing not to spend $44.8 million of that money on major highway projects today, and instead they banked that money so they could use some of the carryover funds to pay for things in this next budget (when the same work will cost more due to inflation).

Even with the use of that $44.8 million in banked funds, Walker’s 2017-19 DOT budget only planned to spend an extra $28.75 million (+4.5%) on major highway projects than what is projected for 2015-17. The Legislative Fiscal Bureau also notes that each of the last two biennial amounts involve less highway spending than what Walker’s first two budgets had, despite growing needs.
6. The 2011-13 and 2013-15 biennial budget acts provided $743.6 million and $728.4 million for the major highway development program, respectively. Before the contingent bonding reduction noted above, the 2015-17 budget provided program funding of $685.9 million resulted in the delayed, estimated completion dates of several major highway development projects (noted in Attachment 3). Then, in October, 2016, the program's funding was reduced by $44.8 million to $641.1 million in the biennium.
This means that several big highway projects will not be complete for at least 2-3 years, despite Walker’s claims that his budget will offer no further delays (leaving out that some of these have already been delayed). And other large projects won’t start in this 2-year cycle.

Estimated completion date for Wis highway projects
I-39/90 Madison Beltline to Illinois State Line 2021
US 18-151/Verona Road (Madison) 2019
US 10-Hwy 441 (Appleton area) 2020
Highway 15 (New London) 2021

Estimated start dates for Wis highway projects
I-43 Milwaukee and Ozaukee Co’s 2019
I-94 in St. Croix County 2019

Walker also proposed cutting nearly $293 million in funding for the Zoo Interchange projects and in expanding and improving I-94 from the Milwaukee airport to the Illinois state line. The LFB says that this will mean that you will see orange barrels throughout those parts of Southeastern Wisconsin for many years.
Given the remaining, $878.2 million in estimated costs associated with these existing projects, if the Governor's recommended biennial funding of $121.9 million is maintained over time, both projects could be completed in slightly more than 14 years ($878.2 million / $121.9 million per biennium). This calculation includes no adjustment for the inflationary costs that would occur beyond the current schedule of 2022-23. Further completion delays would occur if the Governor's 2018-19 funding level, the base year funding ($50.7 million annually) for the next biennium, is provided on an ongoing basis. In addition, if maintained over time, former Secretary Gottlieb indicated that an ongoing biennial funding level of $121.9 million would mean that the reconstruction of all planned southeast Wisconsin freeway megaprojects could be completed over a 70-year schedule ($4.3 billion in estimated costs / $121.9 million per biennium). Similarly, this completion schedule would not include the effects of inflation.

2017-19 is not the only two years that Walker has been taking money out of Southeastern Wisconsin freeways. Total expenses for Wisconsin highway work have declined since Jim Doyle’s last budget in 2009-11, with a cut of over $400 million between then and 2017-19… before inflation. In addition, note how funds have been reallocated to projects outstate.

Expenditures for highways, Wisconsin 2009 vs 2017
State Highway Rehab 2009-11 $1,545.8 million
State Highway Rehab 2017-19 $1,701.6 million (+$155.8 million)

Major non-SE Wis Hwy Development 2009-11 $713.6 million
Major non-SE Wis Hwy Development 2017-19 $669.9 million (-$43.7 million)

SE Wis Freeways 2009-11 $643.0 million
SE Wis Freeways 2017-19 $121.9 million (-$531.1 million)

Proportion of DOT highway spending
State Highway Rehab 53.3%
Major non-SE Wis Hwy Development 24.6%
SE Wis Freeways 22.2%

2017-19 proposed
State Highway Rehab 68.2%
Major non-SE Wis Hwy Development 26.9%
SE Wis Freeways 4.9%

The only way this trend of lower expenses and deteriorating roads can be reversed is to come up with more money. But how? The $93 million in extra funds for the next 2 years doesn’t come close to filling the needs that exist today, let alone fill in the cuts in spending that Walker’s and WisGOP’s past budgeting have caused. The amount that has to be set aside to pay off debt continues to rise in the Age of Fitzwalkerstan, so more borrowing makes things even worse for the future. Tolls wouldn’t start raising money for at least 4 years. And there’s no extra money in the General Fund to tap (hell, we have another $1 billion deficit there starting in 2019).

As the budget bounces ahead (well, it'll go forward at some point, right?), I’ll talk more about ways that we can could up with the money to pay for these projects, even if it means Walker has to break his “no-tax, no-fee” promise to DC lobbyist Grover Norquist. And part of that will look into whether Walker’s talking point about a “9.9% increase in highway maintenance” will ever be put into state roads that continually are being washed out and falling apart in the Age of Fitzwalkerstan.

But in the meantime, the state’s major highways are slated to take a significant step back as things stand under Governor Walker’s budget, and the WisGOP Legislature’s attempts to fix it open up new problems for the rest of this house of cards. Keep your eye on the budget shell game and the moving parts associated with this.


  1. Wasn't the failure to account for the cost of delays and inflation a major component in the legislative audit bureau's findings of cost overruns in highway projects?

    Out Gov seems to be carrying that failure forward.

    1. You noticed that too, eh? Yeah, funny how they claim they'll keep these ones within the tight budgets they've laid out. Suurrre they will.