Tuesday, April 24, 2007

What's really going on with the Transportation Budget?

Does anyone really know what kind of shell game is being played at the capital with our bond and transporation money? There seem to be two different opinions on this. First it's "armageddon" from the story on the Governor's light rail trip:

In his January budget, Schwarzenegger proposed shifting $1 billion in gas tax funds away from transit to help fill the state budget deficit.

The move caused an uproar from transit executives statewide, who argue the governor shouldn't disregard them as he positions California to combat global warming.

In Sacramento, the governor's proposals could reduce RT's state funding by up to $22 million, budget officials said.

Faced with what RT executive Beverly Scott called a brewing fiscal "Armageddon," the RT board this week eliminated several planned bus service expansions in Natomas and Arden Arcade, and froze spending at last year's levels.

Then in an editorial by Dan Weintraub --the sky isn't falling:

Schwarzenegger's proposal has flaws. But taken as a whole, in the context of California's ongoing budget problems, the governor's plan is a reasonable opening to a discussion about the proper level of state support for transit. And its effect would probably not be as disastrous as the transit lobby is making it out to be.

Then there's this response to Weintraub from DOF's Genest:

While much of Dan Weintraub's April 15 column on transit spending and the state budget ("Governor is in trouble over plan for transit funds," Forum) is on the mark, one point he raises warrants some additional discussion.

His assertion that the budget breaks faith with the voters because it uses funds from voter-approved transportation bonds for transit projects -- instead of the state's already overburdened general fund -- is off track. These funds will indeed be spent on public transit projects as promised.

At the same time, the governor is proposing to use a spike in sales tax revenue from high gas prices to finance transit programs for school children and for the developmentally disabled. In recent years, the Legislature has voted to divert these revenues for programs that were tangentially related to public transit (retrofitting Bay Area bridges), or to flat-out siphon off all of these revenues to programs that were no relation to public transit whatsoever.

By contrast, the governor's budget dedicates a portion of these revenues to programs that are clearly transit-related, while at the same time increasing the overall year-over-year state support for local transit agencies by $300 million for a total of $1.5 billion. That's good for public transit, and that's also good for the state's bottom line.

- Michael C. Genest, Sacramento

(Director, California Department of Finance)