Transit and Road Measures Fare Well, but State Revenue Collection Takes a Hit: Takeaways from Election Night
November 8, 2019|Romic Aevaz
Throughout 2019, voters in 31 states decided on over 200 transportation-related ballot measures totaling nearly $19 billion in potential investment. On Election Day, voters across 20 states decided over 100 of these measures, approving over $7 billion in new funding in addition to the $1 billion approved in elections earlier this year. Tuesday night’s results were a mixed bag for transportation. Voters approved hefty investments in public transportation in places like Houston and San Francisco alongside substantial infrastructure bond and tax measures in Maine and in counties across Virginia, Georgia, and Texas. On the other hand, voters in Washington State and Colorado voted to limit how their state governments collect revenue for transportation, with significant implications for future transportation funding decisions.
Measures and Approved Funding by Mode
|Total funding Approved
An overwhelming share of the measures on the ballot in 2019 were for road and highway investments, followed by transit and multimodal measures that covered a range of project types. A strong majority of projects in each mode were also approved by voters. Despite constituting a small share of overall measures, transit is poised to be the recipient of nearly half of voter approved transportation funding. This is largely attributed to the $3.5 billion in funding for Houston METRO and the $32.5 million projected to be raised annually by San Francisco’s ridehail tax.
Voters Approve Major Transit Investments
Harris County, Texas voters overwhelmingly approved a $3.5 billion transit bond (68%-32%) to fund a range of proposed projects as part of Houston’s METRONext plan. As the largest bond measures on the ballot in November, METRO’s bond measure will fund 500 miles of system improvements, including 75 miles of new BRT routes, 16 miles of new light rail extensions, and investments in the exiting bus system, park and ride stations, and accessibility.
In California, voters in San Francisco appear to be on track to approve Proposition D, which would establish a new fee for ridehail trips (3.25% for private rides, and 1.5% for shared rides). Because the measure is a dedicated tax, it must receive a two-thirds supermajority to pass according to California law (on Wednesday, it had the bare minimum 66.66 percent of the vote, but that ticked upwards to 67.31 percent of the vote in the 4 p.m. Thursday update.). The fee would generate over $30 million annually in dedicated funding for transit and pedestrian infrastructure through 2045. Revenue would be divided equally between the San Francisco Municipal Transportation Agency for transit and the San Francisco County Transportation Authority for pedestrian safety improvements.
Cincinnati voters also took their first step towards potentially approving a dedicated sales tax for transit by approving Issue 22. The initiative, which was passed by 75% to 25%, will repeal the existing 0.3% income tax if voters approve a 0.8% sales tax increase to fund transit next spring.
Traditional Road Bonds Widely Approved, but Mixed Results for Sales Tax Measures
More traditional sales tax and bond measures for roadway projects also performed well on election night. Voters in Maine approved one of the only statewide transportation bond measures by a wide margin (76%-24%). The $105 million bond will invest $85 million in construction and repair of state priority highways, while $15 million would be dedicated for freight and passenger rail, transit, maritime, aviation, and ped-bike facilities and equipment.
At the local level, voters in Albuquerque approved a variety of bond measures, including a $33 million streets bond that will fund road reconstruction, sidewalk accessibility improvements, traffic signaling upgrades, ped-bike infrastructure, and neighborhood traffic management, and a $3 million transit bond that will fund station and fleet improvements. Other major bonds include a $412 million transportation bond in Williamson County, Texas, and a $355 million bond in Prince William County, Virginia.
Other tax renewal measures fared well on Tuesday. Voters in Henry County, Georgia approved renewed their local option sales tax, which is expected to fund over $92 million in county and city transportation projects. Colorado Springs voters renewed a dedicated sales tax at a reduced rate, which is expected to raise over $280 million for road repairs and improvements over the next five years.
Sales tax increases, however, did not fare as well as renewals. Of the tracked measures, 7 new or increased sales tax measures passed, while 10 did not. Larimer County, Colorado voters rejected a half-penny sales tax increase that would have raised nearly $1 billion over two decades. Similarly, over two-thirds of Osceola County, Florida voters rejected a one-cent sales tax increase earlier this year to fund $2 billion in road improvements over 30 years. Voters did approve a handful of smaller sales tax measures, like a quarter-cent sales tax increase in Lincoln, Nebraska to fund road repair (approved during the April 2019 election), a two-third cent sales tax increase for street repair in Oak Harbor, Washington, and a quarter-cent sales tax increase for Laketran Regional Transit Authority in Lake County, Ohio.
In contrast to past trends of voters rejecting fuel tax increases, two localities in Oregon – Scappoose and Coburg – approved local fuel tax increases to fund road improvements. Over 53% of Scappoose voters approved a 3-cent fuel tax for street repair and safety projects while 80% of Coburg voters approved raising their fuel tax from three to six cents to fund road improvements.
Voters Approve Restrictions on State Revenue Collection in Colorado and Washington
While Tuesday’s elections green-lighted billions in new investment for transportation, they also introduced new challenges, and even revenue cuts, in Colorado and Washington. Colorado voters rejected Proposition CC which would have allowed the state to keep funds it collects above its revenue cap, instead of issuing annual refunds to taxpayers, to fund public education and transportation. The repeal would have provided over $217 million for state and local highway and transit projects.
In Washington State, voters are on track to approve Initiative 976 by a 55%-45% margin (as of November 7). Dubbed the “$30 Tabs Initiative”, the initiative would limit vehicle license fees to $30, prohibit regional transit agencies from imposing motor vehicle excise taxes, and prevent localities from collecting car registration fees through transportation benefit districts, which are commonly used to fund infrastructure maintenance projects across Washington.
Given the widespread use of car tabs to fund a range of transportation investments across the state, from highway and road maintenance to light rail and bus projects, estimates show $302 million in lost annual revenue for state transportation funding, $58 million annually from local transportation benefit districts, and $328 million annually for Sound Transit. The passage of Initiative 976 is certain to introduce significant uncertainty, legal challenges, and reevaluation of transportation funding in Washington, particularly for agencies like Sound Transit that have already issued bonds against anticipated car-tab revenue.
(Ed. Note: This is the third time that voters in the Evergreen State have passed a ballot initiative limiting car tabs to $30, all of which have been sponsored by local anti-tax advocate Tim Eyman. The previous two were struck down by courts to varying degrees because, the courts ruled, existing bond agreements take precedence. So, to the extent that bonds have already been issued based on higher car tabs, that money appears safe. But this time, Eyman got clever (and the state legislature got lazy). Initiative 976 not only limits car tabs to $30 per year, it also orders the state to use Kelly Blue Book value of a car when levying any future car tax that is based on car value. For some reason, Washington State law has required any local government that issues ad valorem car taxes – like Sound Transit – to use a different valuation. A 2017 Seattle Times article said “Sound Transit says a 1-year-old car is worth 95 percent of its sticker price. Kelley Blue Book says the average 1-year-old car is worth only 70 percent of its sticker price. Sound Transit says a 2-year-old car is worth 89 percent of sticker price; Blue Book says only 59 percent.” In effect, Sound Transit was able to charge a lower tax rate because it was artificially inflating car value, which may have angered more voters than a higher tax rate on their real car value would have.)
Eno will continue to track transportation-related ballot measures as we have done for a number of years. Our ballot measure database will be updated as they appear before voters this year and beyond. Note the Eno Center for Transportation does not endorse or oppose any of the measures. The information is provided for research purposes only.