Discussion among five Northeastern governors Aug. 11 ran the gamut of challenges facing the states in tough economic times, but the problem of how to pay to fix their congested roads and deteriorating bridges captured the spotlight.
Improving the country’s crumbling infrastructure is becoming more difficult for states as their economies tighten and prices for building supplies skyrocket, but federal policies are hampering states’ improvement efforts, too, the governors said.
“Whatever we invest today isn’t going to be enough,” said Connecticut Gov. M. Jodi Rell (R), noting that steel prices rose 93% in the last year. Meanwhile, she said, governors are “angry” because the Bush administration is promoting partnerships with private companies to lease or manage public assets such as toll roads or airports, rather than offering states more money.
“The truth is, we do like to blame the federal government, and rightly so. (The highway system) was a national, interstate defense highway system when it was created a half century ago,” added Vermont Gov. Jim Douglas (R).
The difficulties of shoring up infrastructure were among several problems the governors addressed as they told a regional conference of the Council of State Governments meeting here about the problems they face governing in a bad economy.
The ailing economy has pummeled many state governments and their constituents. Some states, such as New Jersey, were slammed, with Garden State lawmakers this year cutting $3 billion in spending for the first six months of 2008. Other states, such as Pennsylvania, largely avoided painful cuts this year.
The Northeastern governors all shared worries that their residents would be hit hard this winter because heating oil prices are rising dramatically while rising gas and food prices also are crimping family budgets. The governors also discussed the need to reinvigorate their manufacturing businesses and promote new and cleaner energy sources.
But they were unanimous in their frustration with the federal government on transportation efforts.
Pennsylvania Gov. Ed Rendell (D) is using his new term as chairman of the National Governors Association to highlight the need to spend more money on infrastructure improvements. That effort could cost $1.6 trillion over five years, he said.
Rendell said it looked increasingly unlikely that Congress would raise the federal gas tax to pay for highway repairs. Even worse, the federal Highway Trust Fund—a main source of state road construction money fed by the federal gas tax of 18.4 cents per gallon—is projected to fall $3 billion short this year because Americans are on track to drive 40 billion fewer miles than last year, according to the U.S. Department of Transportation.
The public-private partnerships promoted by the Bush administration are problematic politically, Rendell said. New Jersey Gov. Jon Corzine (D), like Rendell, encountered stiff resistance when promoting these kinds of arrangements, and the joint ventures would not be the “panacea” the federal Department of Transportation promised, Corzine said.
But Corzine and Rendell both expressed interest in a measure before Congress that would set up a federal bank, funded primarily through the private sector, which would invest in infrastructure improvements. Corzine, a former chairman of the investment firm Goldman Sachs, said big investors are interested in infrastructure. “The money is there,” he said.
