Legislators continue discussions on how to fund TxDOT

But halfway through the session, which ends in late May, no clear plan has yet been outlined on how to solve the funding issue in a state that has exhausted its transportation bonding capacity and runs of out of bond money in 2014 after a decade of successful building and borrowing.

Proposed fee increases

House Speaker Joe Straus has said the $25 fee paid for driver's license renewals every six years should be looked at as an additional revenue stream, and bills have been filed that would both increase that fee and decrease the amount of time between renewals.

In early March Rep. Patricia Harless, R-Spring, filed House Joint Resolution 136 and HB 3157, which would require voter approval for transportation funding and would collect nearly $5 billion in annual new money for highway maintenance.

The bill would include a $50 increase in registration fees, a 10 cent increase in the gas tax and a redirection of some sales taxes from car sales into highway maintenance. The bill also addresses the fee diversion issue described by Perry and others.

Members of the House Transportation Committee say those particular bills may not be the vehicle that carries the funding solution, as it's likely to be broken into piecemeal bills and approved separately by Darby's subcommittee and budget writers before hitting the floor of House and Senate.

But a Houston-area taxpayer advocacy group, Texas Future, has endorsed her plan, saying it costs motorists less than one penny per mile and avoids new toll roads.

"We cannot borrow our way into highway prosperity. Nor can we toll our way into affordable highways. We should not ask our children to pay for the roads we need," the group said in a statement. "These bills provide the answers as to how Texas can move forward with our highway and freeway needs in an economical and sustainable way."

New funding source needed

State Sen. Kirk Watson, D-Austin, is pushing for a $50 increase in annual motor vehicle registration fees, which currently start at $50.75 per year. Local governments have the power to raise that fee by $10, and several have, including Travis County.

Lt. Gov. David Dewhurst has promised to propose an amendment to the budget passed by the Senate Finance Committee in early March that would authorize at least $1 billion from the state's Economic Stabilization Fund, also known as the rainy day fund, for a revolving loan program for local transportation projects.

Gov. Rick Perry, who held off efforts to use the fund during the money-strapped session of 2011, has endorsed the use of $1.7 billion for transportation projects from the fund, which is expected to have a record high balance of $11.8 billion in the next two years.

Using rainy day funds

Bills have also been filed in the House to withdraw money from the rainy day fund.

The caveat to using the fund is that it cannot be used for any revolving cash flow to the Texas Department of Transportation, so another funding mechanism for maintenance and other operating costs must be found.

Leaders, including Perry, have suggested that more than $1 billion can be found in dedicated fees that are diverted from highway projects, but House Transportation Committee Chairman Larry Phillips has argued that the amount might be closer to $300 million—nowhere near the more than $4 billion in additional annual funding TxDOT officials have said the department needs just to maintain highways.