House Finance greenlights major transportation funding legislation | News | –

The House Finance Committee Monday made major changes to Senate Bill 21-260, the bill that would push billions of dollars toward transportation projects. The bill is backed by a bipartisan coalition of elected officials, including the governor and Colorado Springs Mayor John Suthers.

House Speaker Alec Garnett of Denver told the finance committee that the state is falling behind on transportation funding. The aging system stifles growth and doesn’t meet diverse state needs, he added. The gas tax, which has been at 22 cents a gallon since 1991, is a declining and unsustainable revenue source, he said, and that in that same period, the cost of construction for transportation projects has more than tripled.

In addition,  transportation habits have changed, most recently during the pandemic, with more reliance on delivery services and ride shares. This plan will modernize the transportation system, Garnett said, and it comes with the biggest coalition around transportation he’s ever seen.

Rep. Matt Gray, D-Broomfield, the bill’s co-sponsor, said what’s been tried before hasn’t worked, whether it’s a bonding-only proposal or a sales tax proposal.

“They’re not asking us to kick the can down the road, they’re asking us to solve the problem,” he said.

People who use the system are willing to pay a little more, so long as they’re treated fairly and everyone else pays a little more, Gray told the committee. The bill honors commitments from SB17-267, which allows for the issuance of certificates of participation to pay for up to $2 billion in road and highway projects, Gray said.

The fees to be raised under the bill include:

  • A road usage fee that would ratchet up annually over 10 years to a maximum of 8 cents.
  • 3.5 cents per prearranged ride in a zero-emission vehicle and 7.5 cents for every other vehicle.
  • 6.9 cents for retail deliveries.
  • 5.3 cents for each delivery to support a fund to transition government fleets to electric vehicles.
  • Raising the $50 registration fee for electric vehicles with an index that makes EVs equitable to what combustion vehicles pay.
  • Indexing the current $2 fee per day on vehicle rentals to inflation, exempting car-sharing programs.
  • Changing the Statewide Bridge Enterprise to the Statewide Bridge and Tunnel Enterprise, and authorizing its board to impose a fee on diesel and deliveries.

The bill creates four separate state enterprises to pay for projects, each with less than $100 million in annual revenue. That’s to get around Proposition 117, which required any new fees for enterprises with more than $100 million in annual revenue to be approved by voters.

Mike Kopp of Colorado Concern, a consortium of more than 140 CEOs, told the Finance Committee the state faces a declining transportation system. Estimates of the cost of projects from the Colorado Department of Transportation is around $8 billion, Kopp said.

Out of the total package in the bill, about 70% will go toward a 10-year plan for CDOT, which will be accountable and transparent, Kopp said.

The bill got plenty of changes in Monday’s hearing.

Among them: under the bill, the four state-run enterprises are to be run by gubernatorial appointees. An amendment changed that to add that those appointments must be confirmed by the Senate.

A second amendment from the bill sponsors ensures that fees on deliveries are only imposed once and not multiple times in the supply chain. It also would create a separate account for tunnel projects in the bridge and tunnel enterprise.

A third amendment would allow lawmakers to replace some of the money in the bill with federal stimulus dollars. The amendment calls for $378.4 million from the funds given to the state to backfill lost revenue under American Rescue Plan guidelines. Of those dollars, $160 million would be placed in the multimodal transportation fund; $36 million would go to the highway users trust fund and $181 million to the state highway fund.

A fourth amendment says that if electric vehicles are not available in the clean fleet enterprise, compressed natural gas that comes from recovered methane would be eligible for funding from that enterprise.

The fifth amendment requires CDOT to update its 10-year plan to comply with the bill, especially its goals on greenhouse gas, according to Garnett.

The bill’s Section 29 is among its most controversial. That section talks about environmental impacts, including climate change and reduction of greenhouse gases.

It states that expansion projects intended to alleviate traffic congestion by increasing highway capacity in major transportation corridors cause adverse environmental impacts, including climate change and adverse health impacts. That’s particularly in the communities closest to those highways, the section says.

The bill requires CDOT and its metro planning partners to formulate procedures and guidelines to account for the impacts those projects will have on greenhouse gas pollution.

Will Toor, director of the state’s Energy Office, said that section will help the state achieve both air quality and mobility goals, including a significant investment in the multimodal fund. Transportation is the single largest source of pollution, he said, and pollution generates $2 billion per year in damages. Switching to electric cars, trucks and buses are among the most important improvements that can be made to address climate change, he said, and the state’s roadmap calls for nearly a million electric vehicles on the road by 2030. SB 260 is the next step, with $750,000 to build EV charging infrastructure and to transition buses to electric, he said.

“This isn’t the full amount we will need to support one million EVs on the road,” Toor said, but it is a critical element to fill gaps and allow the state to leverage utility and private sector investment.

CDOT Executive Director Shoshana Lew told the committee the state needs a modern system of charges that reflect who the users are and how vehicles work today, which she said are 30% more efficient than they were years ago.

She said CDOT also learned lessons from the Central 70 project, issues around mitigation raised by those affected by the project. That input came too late in that project on Interstate 70 through Denver’s Globeville and Elyria-Swansea neighborhoods, but the lessons from those hard conversations will help CDOT into the future, she said.

Much of the testimony Monday was from supporters of the bill, such as the Metro Mayors Caucus, Suthers, Lyft, county commissioners from County Commissioners Acting Together and the Denver Regional Council of Governments.

But Karl Maxey of MGS, which includes Maxey Trucks and Trailers, said that only $760 million in new money goes to roadways. Patrick McConnell of Americans for Prosperity Colorado said voters deserve a voice, and Proposition 117 gives voters that voice. But this bill clearly bypasses the will of the voters, he said. The larger takeaway, he said, is that the fees are really a regressive tax, and will play a disproportionate impact on low income, rural or senior Coloradans.

It will also lead to a rise in the cost of goods and services in addition to making it more expensive to get to work, McConnell said.

The bill passed on a party-line 7-4 vote and is now in House Appropriations.

SB 260 still isn’t a good fit for the Fix Colorado Roads coalition. Sandra Hagen Solin said in a statement after the hearing that they are still looking for amendments that will allow for the bill to do a better job of funding roads and bridges. They’re also concerned about the bill’s environmental requirements, which they say will create “onerous delays for maintenance of existing infrastructure or construction of new projects.

“While Senate Bill 260 does a lot of admirable things to move our state toward a transportation system of the future, the provisions in Section 29 are still very concerning,” Solin said Monday. “There are times when additional reviews are necessary to assure a project is environmentally sound and cognizant of a surrounding community, but embedding requirements for a myriad of layers of enhanced level of planning for a broad swath of important capacity projects will result in, at a minimum, slowing down the delivery of those projects and increasing costs – undercutting any gain in funding proposed road projects.”

Garnett told reporters Tuesday that the Finance Committee said the bill seeks a delicate balance and what happened in the committee “moved us to a place of striking the right balance.” He pointed out that the bill now has a Republican cosponsor, (Sen. Kevin Priola of Henderson). But he doesn’t believe it will pick up support from the Republican House caucus, adding that the groups they listen to support the bill.

“It doesn’t feel like a partisan issue,” Garnett said.