A recent San Benito County Board of Supervisors' retreat highlighted the challenges the county faces as it struggles to find revenues to fund crews that in previous years would handle maintenance and repair tasks on local roadways.
Brent Barnes, the county's Resource Management Agency director, said that over the past few years road maintenance has been reduced overall in order to focus on essential repairs. He told the board on Feb. 16 that local revenue sources have declined, beginning about the time of the recession of 2008.
“That has forced our hand as a county to focus strictly on life safety sorts of things,” he said. “In the spring, we mow once at sight lines, intersections and interchanges. The sides of roads are not cut back as much as they had been because we don’t have the crews to do that work.” He said this creates a fire hazard, but the risk is acceptable.
During the wet months, the focus is potholes.
“Those are the two main functions we have,” Barnes said. “There isn’t a season or a level of effort we’re able to dedicate for increasing the lifespan of our roads.”
Supervisor Mark Medina asked Barnes how many people were in the 2017 budget to work on roads. Barnes said he had one functioning road crew, consisting of five positions, two of whom are currently on light-duty status, leaving three to work on the roads.
Ray Espinosa, county administrative officer, commented that 2017 General Fund revenues are comparable to 2005. He said when the county had multiple road crews, they were partially funded by millions of dollars from the state. As Medina looked at the personnel list, he tallied 17 public works positions and wondered why there were only five people available to work on roads. Barnes told him many of the positions were empty because of budget limitations.
Medina seemed puzzled by the difference in numbers.
“I was tasked with reducing my budget a half million dollars this year,” Barnes explained. “The way we make that up is by not filling those positions.”
“So we’re not filling those positions and we’re not doing the work, either?” Medina said.
“You’re absolutely right,” Barnes said.
Espinosa said the problem is worsened as the county continues to see a greater decline in state revenue sharing. Medina wondered if the county was taking money from the wrong category and said that every day roads are not repaired only increases the ultimate cost when repairs are finally done.
“We have to consider this a crisis,” Medina said. “We have to do something. We just keep kicking the can on down the road. It’s time that we actually see results.”
Supervisor Jaime De La Cruz agreed, saying, “You’re right and it took a major situation like we have now for us to open our eyes."
Supervisor Anthony Botelho said local revenues should be rising because of all the people moving into the county. He questioned if fuel efficient cars have really had much of an impact on revenues and wondered where the money has gone. He said mowing should be contracted out rather than ignored.
Barnes said there is an alternative to mowing that has not been used because the county is considered, “organic,” which is spraying. “We made a decision that mowing is a better alternative,” he said. “That could change. There may be parts of the county where that’s acceptable.”
Supervisor Jerry Muenzer asked if the county's General Fund money could be used to pay for road crews. Mary Gilbert, director of San Benito County Council of Governments, said COG is proposing some of that money be used, as well as some her agency's money.
“We haven’t come to a conclusion at the end of the year exactly how we’re going to cover a shortfall should there be one,” she said.
Muenzer said COG and the board needs to start selling to the public that it will take local money in the form of a sales tax to begin repairing roads.
“Supervisor Botelho used to say the greatest thing about the drought was it was saving our roads,” he said. “Well, we’re no longer in a drought and we’re seeing the effect on our roads.”
Finding funding
Espinosa said that looking at the county’s infrastructure from a global perspective, supervisors had to consider road needs versus how much they were prepared to pay for repairs. He told the board he had met with Gilbert and Barnes to formulate a plan for the meeting.
Gilbert told the board she wanted to give them the view of how money trickles down to the local level. She said the flow begins with the federal fuel excise tax and two state fuel excise taxes, sales taxes, truck weight and vehicle fees, and bonds that go toward transportation projects. Locally, there are transportation mitigation impact fees and sales taxes to pay for local projects. She said the federal tax is 18 cents per gallon of gas and 24 cents per gallon on diesel, of which 85 percent goes to the Federal Highway Administration to funnel to the states. Fifteen percent goes to public transit.
Muenzer asked her if any of this money finds its way down to the counties. She said the states have a mechanism to allocate funds locally through the state highway accounts and then to the State Transportation Improvement Program (STIP).
“Unless the state steals it all,” Muenzer said.
Gilbert said it gets complicated and that the 18 cents fuel tax has remained the same since 1994, despite increasing costs of road projects. She said 36 percent goes to cities and counties; 64 percent to the state. There is also an additional price-based excise tax, which is set by the Board of Equalization, which varies from year to year. It is allocated to the state’s general fund in a gas-tax swap before trickling down to the state highway account.
Truck-weight fees also go into the state's general fund, Gilbert noted, and vehicle fees go to the Department of Motor Vehicles (DMV) and Highway Patrol. Then there is the bond that was passed in 2006. She said it did fund some projects in the county, including the Highway 25 Operations and Safety Project (a barrier between lanes).
What would seem like a flood of cash soon begins to dissipate as it flows downstream to counties and cities. The price-based excise tax is diverted into the general fund and truck weight fees pay off debt service before coming to the state highway account to be broken up for local streets through several road programs.
“Right now, all of the funding that’s in San Benito County is currently reserved for improvements in Highway 156, and widening that between Hollister and San Juan Bautista,” Gilbert said. Traffic impact fees are charged to new housing developments. She said an additional option to pay for local roads would be a sales tax and recounted how Measure P, a specific sales tax that that would have gone to transportation, failed at the ballot box.
Gilbert said COG is considering another attempt at placing a sales tax on the Nov. 2018 general election ballot and that a toll road might be an option. She said toll roads in California have successfully financed large transportation projects and that Highway 152 might be considered for conversion into a toll road.
Funding challenges
Gilbert said gas tax revenues are declining and costs are increasing because road maintenance around the state has been deferred for years. The problem has grown worse, she said, as state revenues have been diverted away from transportation projects. There is presently a $57 billion, 10-year shortfall in repairing existing state roads, and $78 billion for local roads, according to Gilbert. There has also been a lack of investment in rail and transit.
“The State Transportation Improvement Program had a $754 million reduction last year,” she said. “As a result, the 156 project was delayed about two years.”
Since 1994, when the 18-cent excise tax ceased to increase, fuel economy has gone up, which caused revenues to drop, Gilbert noted. She said revenues will continue to decrease, even as people drive more.
So why are California roads more expensive to repair? One reason is because real estate is more expensive than in most other states. State regulations also add costs to projects. And because the state has few mass transit systems, the car is the preferred mode of getting around, putting a massive strain on roads. Truck traffic along the Central Coast and the county worsens conditions on aging roads, which is more expensive to repair the longer delayed.
Each year, Gilbert said, local agencies get excited, anticipating increases in truck-weight fees and excise taxes. She also said vehicle license fees may increase, particular for fully electric vehicles that don’t pay any fuel tax.
“At the state level there is a pilot program for a road-user charge,” she said. “That would be a charge in lieu of a gas tax for each mile you drive.”
De La Cruz wondered if any counties were already testing the road-user program. Gilbert told him that the pilot program involved volunteers who had monitoring devices in their cars. He asked her to get whatever data is available for the board to consider.
Medina commented that by the time people pay all the current taxes and then add on a road-user tax, they would have nothing left for themselves. Gilbert reiterated that such a tax would replace the fuel tax.
Muenzer added that the state and county were 20 years behind on repairs. “I don’t think this road-user charge is the answer,” he said.
Botelho said he’s frustrated as revenues continue to decline as costs keep going up.
“The people who call me are more agitated,” he said. “Now we’re talking about raising fees and taxes, but what are we getting done? They still see a lot of money flowing out and no work is being done. George Rose, an old county commissioner, jumps down my throat all the time. He says, ‘we used to do chip seal and overlays, and you don’t see any of that.’ I haven’t seen that for 20 years in this county, and that’s why all these roads are falling apart.”
Botelho said there needs to be a better strategy to use the available funds to fix the roads. He said he has noticed a difference in how the roads are maintained, pointing out that when he was growing up in the county it used to “cut ditches, but we don’t cut ditches anymore.” He went on to say that culverts need to be checked before it rains to make sure they’re clear.
