As Toll Discussion Continues, Connecticut Special Transportation Fund Faces Insolvency

Feb 27, 2017

Connecticut’s special transportation fund could be insolvent within four years if lawmakers don’t take action to secure new revenues. That was the message from the governor’s budget team to members of the legislature’s transportation committee Friday. 

Lawmakers are considering whether Connecticut should install highway tolling.

Garrett Eucalitto, who’s in charge of transportation at the Office of Policy and Management, told the panel that declines in revenues from taxes and fees will soon mean the fund runs out of money. That’s despite the addition of a portion of the sales tax, which was supposed to support an ambitious infrastructure program.

"If you were to remove that $340 million that we're projecting in fiscal year 2018," he said of the sales tax remittances, "the bucket would be empty within the next year or two. So the 0.5 percent of the sales tax is keeping this afloat."

Connecticut is the only state on the eastern seaboard that doesn’t operate highway tolls. Eucalitto told the panel that tolling could help, but only in the longer term.

"It would take several years for the tolls to be up and running on the major interstates," he said. "You would need to do design; you would need to get approvals; you'd need to install the gantries; you'd need to set up a whole new system at DOT to do those collections."

Federal grants have made up about 70 percent of Connecticut funding for transportation capital programs in recent years, but one consultant raised real concerns about whether that is a sustainable model.

"The federal grants are certainly at best stagnant, and one would say a diminishing and uncertain source of investment," said Emil Frankel. He doesn't put much store in the Trump administration's promises of a trillion-dollar infrastructure investment, because it's still not clear where the money would come from.

Federal highway programs were historically funded by the gas tax, but that hasn't been increased in 25 years, and there are no signs that it will be. That's lead to a growing gap between the revenues available, and the funding levels authorized by Congress.

"We have a real crisis, despite all the talk about a major infrastructure investment program," said Frankel.

Cameron Staples, who chaired a recent Transportation Finance Panel which reported to the legislature, tried to find a bright spot for the committee.

"This is a situation where you can actually take action today that will avoid a scenario in 20 or 30 years where the situation will be catastrophic," he told them, comparing it to the current fiscal crisis over pension payments. "You really are at the front end of an opportunity to create prospective change."

One state study has estimated that tolls could net the state $62 billion over 25 years.