The Arkansas Supreme Court may have handed the Arkansas Department of Transportation a loss in October, but the agency isn’t licking any wounds.
In November, ArDOT got the news it wanted when voters statewide approved Issue 1 by a margin of approximately 10%. The passage of the bill will make permanent a 0.5% sales tax dedicated for roads and highways.
Voters had approved a 10-year sales tax in 2012, but with that funding mechanism set to expire in 2023, ArDOT was in the uncomfortable position of not knowing for sure what its funding levels would be in three years. The department had drawn up a list of potential projects, what it called the Connecting Arkansas Program 2, which can now be scrutinized more closely for implementation.
“It is a load off of our minds,” said Philip Taldo of Springdale, who is a member of the Arkansas Highway Commission. “Highways are something that you don’t plan in one year, two years or three years. It is five- and 10-year plans and 20-year plans, and it is hard to plan whenever you don’t know what to expect for revenue from year to year.
“This enables us to plan way ahead and be reasonably assured that we are going to have funding available to complete the projects.”
The passage of Issue 1 was the second part of Gov. Asa Hutchinson’s efforts to increase and stabilize funding for the department. In 2019, Hutchinson signed legislation that centered on raising the per-gallon taxes on gasoline and diesel that are expected to provide $95 million in annual revenue to ArDOT.
Coupled with the $205 million the permanent sales tax was projected to provide annually, ArDOT can be reasonably confident that it will have $300 million or thereabouts to plan with.
“It is pretty humbling to know that our taxpayers and voters trusted us with that amount of money to go out and take care of the roads,” Taldo said. “It is a load on your shoulders, and we want to make sure they get every bang for their buck.”
30 Crossing Roadblock
The Arkansas Supreme Court proved that plans can be upended, of course. It ruled in October that ArDOT could not use revenue generated by the 2012 sales tax to fund work on the $1 billion 30 Crossing project in downtown Little Rock.
The 6.7-mile project will expand the Interstate 30 corridor from six lanes to as many as 10 and includes replacing the interstate’s bridge over the Arkansas River. The state Supreme Court ruled the sales tax’s funds couldn’t be used because the wording of the constitutional amendment passed by voters in 2012 referred repeatedly to funding for four-lane highways.
ArDOT Director Lorie Tudor, who was not available for comment, released a statement last week that said work would continue on the 30 Crossing project using alternative funds. She said the project had multiple funding sources, including $180 million from the state and federal governments.
“These funds are now being used for all expenditures including contractor payments,” Tudor said. “ArDOT will prepare a funding plan to offset the removal of Amendment 91 funds upon receipt of the final orders from the Supreme Court and the Circuit Court. Regardless of the source of funds, ArDOT is committed to moving forward with the project and we have no plans to suspend work. To suspend construction would come at a huge cost to taxpayers.”
Issue 1, which makes the 0.5% sales tax permanent, removed the problematic language restricting the funding to the four-lane highway system. So, barring some other judicial setback, monies won’t have to be moved around to avoid conflict when the permanent tax kicks in in three years.
By that time, Taldo said, the commission hopes to have several projects ready to take advantage of the funding. Taldo said planning is a critical piece of transportation projects. Engineers and workers don’t just show up one day and start building a bridge. Permits and environmental clearances must be obtained and right of way must be bought. Knowing that $300 million will be available without strings in a few years means ArDOT can start the lengthy preparation process now.
The CAP 2 wish list includes several high-profile projects that ArDOT has wanted to undertake for years.
The biggest is the I-49 extension between Fort Smith and Texarkana. The interstate, which would connect New Orleans with Canada, is almost complete, except for 150 miles along the western border of Arkansas.
Arkansas won’t be able to complete the project anytime soon since the price tag is more than $2 billion, and a short stretch in Van Buren that includes a bridge will cost more than $500 million.
“Whatever we have to do to get it built, we’re going to get it built,” Taldo said. “It’s just a matter of time. I would hope that we could be driving on it in 20 years. That might be a little optimistic. If we don’t have another 2020 in the next 20 years maybe we could do it.”
Another potential project is one that would add lanes to I-40 between North Little Rock and Memphis, which checks in at nearly $500 million. ArDOT spokesman Dave Parker said the department has 15 to 20 projects on the CAP 2 list.
“It allows us to now start taking those projects that were on the table, 10-year and 20-year projects, and start to plan and prioritize and get those going,” Parker said. “Now that the funding is there we are literally sitting down and looking at those projects and prioritizing what comes first.”
Taldo said the increased funding from Act 416 and the permanent sales tax will allow the department to be more proactive in maintenance. Just as it is cheaper to change your oil than replace your car’s engine, renovating roads and bridges is much cheaper than replacing them.
Taldo believes that in the long run being able to stave off major repairs through more extensive preventive maintenance will result in more money saved and thus more available for capital projects.
“That maintenance is something that sneaks up on you and you don’t realize it,” Taldo said. “It’s not something that one day it is fine and the next day it is bad. It’s a little bit at a time. It gets to the point where most people don’t realize it until it is out of hand.”