Transportation Funding in Maryland: Do or Die Time

            It's do or die time for the Purple and Red light rail lines. If the legislature is able to raise revenue for transportation during this legislative session, both lines will probably get the federal funding they need and will go forward. Should the legislature fail to raise revenue the federal funding that has currently been allocated will run out and the feds will not fund any more work on the rail lines.

             According to the Maryland Department of Transportation (MDOT), the Maryland Transportation Trust Fund was established in 1971 and is funded through a number of sources. These include corporate income taxes, vehicle titling taxes, transit fares, MVA fees, and of course the gas tax (which interestingly enough only makes up about 20% of trust fund revenue). According to MDOT, pooling all transportation revenue into a single fund gives the state a great deal of flexibility as to what it spends its transportation dollars on. The Maryland Transportation Trust Fund is viewed as a national model for how to fund transportation.

            In a sense, this flexibility is a good thing as there is an argument to be made that policymakers should be able to spend the money as they wish. But there is also a downside. Many transit agencies have their own dedicated source of money that they can draw from. But both the MTA and WMATA must go to the legislature each year for funding. Such a situation most likely creates uncertainty for both organizations and may make long term budget planning difficult. Furthermore, with such flexibility there is nothing to stop policymakers from completely gutting transit funding and spending the money on wasteful highway projects.

            This isn't just a theoretical situation. During the Ehrlich administration there was a plan to redesign the bus system. This was known as the Greater Baltimore Bus Initiative. While the need for a bus system redesign was (and still is) long overdue, the Initiative was more about cutting the MTA's funding than it was about creating a system that works for everyone. Eventually the Legislature had to step in and prevent further changes to the MTA's route structure.

            Having the Trust Fund serve as the end all be all for transportation financing may also make it difficult to raise revenue. Since the Trust Fund relies on revenue throughout the state it must fund projects throughout the state. This means that transportation projects have their futures intertwined with each other. Some of these projects have more support and are of greater use than others.

            There are three components that increased revenue from the Transportation Trust Fund will be spent on. The first component is the Purple Line. The Purple Line is a light rail line through the DC suburbs that is projected to carry about 69,000 people a day by 2030. The only organized opposition to this project comes from a country club in Chevy Chase worried about the effect it will have on their precious golf course. Elected officials in Montgomery and Prince George's County's are so determined to get the line built they have even considered instituting a regional gas tax should the legislature fail to shore up the Trust Fund.

            The second component consists of the Baltimore Red Line. Since the beginning of Red Line planning, ridership projections have fluctuated around a bit but the line is currently projected to have about 50,000 passengers a day by 2030. There has been considerable opposition to the Red Line. While much of this opposition has come from those more concerned about car lanes than anything else, many of those opposed to the Red Line are true transit advocates. The reasons pro-transit advocates oppose the Red Line are complex and are better discussed at another time. Unlike in the DC suburbs, Baltimore's political leaders do not have the same enthusiasm for the Red Line. The project is little more than a footnote when it come's to the city's agenda for this year's state General Assembly and Baltimore County Executive Kevin Kamenetz does not even name the Red Line as a top transportation priority.

            The third component is made up of highway expansions. This component is just plain stupid. Due to the phenomenon of induced traffic, more highway lanes only lead to more traffic. For some reason policymakers have yet to understand this proven concept.

            All of the above projects will rise and fall together even though they have varying levels of merit and support. While the state should pay for a significant portion of all transit projects, having it be the only source of funding may be a mistake. If policymakers are serious about getting major transit projects it may be time to consider regional sources of funding. These may include things like regional payroll, income, sales, or property taxes.

            More regional funding could potentially mean more local control over the system. The MTA is currently a state agency with local officials having no say in how the system is run. Most other systems are independent authorities with their own board of directors (which are often in part appointed by local officials). Such an arrangement harms the ability of the MTA to do its mission. For example, the MTA must follow state procurement procedures. This means that when the MTA is making major investments they must first be approved by the MTA's own procurement office, then MDOT headquarters, then the state Department of Budget and Management, and finally the Board of Public Works. This is part of the reason why it has taken the MTA six or seven years (and counting) to put in a real-time arrival system.

            Changing the funding and governance structure transit in Baltimore will not be an easy task. It will require strong efforts from both grassroots activists and more establishment organizations like big business and large nonprofit organizations. However, I do believe the benefits of such an arrangement could be worthwhile.

- Gregory Friedman

NOTE: Shortly after I finished writing the draft for this blog post. Maryland Senate President Thomas V. “Mike Miller” proposed a funding plan similar to what I discuss below. These are potentially exciting times for transit in the Baltimore region.