Facing a $5 billion transportation deficit, the Legislature approved a bill this session that will be the largest transportation funding increase in Texas history if approved by voters in November.
The bill—Senate Joint Resolution 5— would amend the constitution to dedicate $2.5 billion of general sales tax to the State Highway Fund beginning in 2018. It would also provide 35 percent of motor vehicle sales tax revenue after the first $5 billion beginning in 2020.
Transportation funding from motor vehicle sales tax revenue is expected to be about $500 million to $600 million in 2020, said Scott Haywood, president of transportation nonprofit organization Move Texas Forward.
The funding mechanisms of the bill have strings attached to them in the event of a downturn in the state economy. The dedication of funds from general sales tax could be halted if sales tax revenue comes in lower than $28 billion in a fiscal year, Haywood said.
SJR 5 was filed with the Secretary of State’s office June 1. Because the bill aims to amend the constitution, it will need to be approved by voters in the Nov. 3 election. Funding will not be available until 2018.
“As [legislators] were going through the budget process for the biennium, [SJR 5] wasn’t part of the conversation,” Haywood said. “But it will allow [the Texas Department of Transportation] to plan for the next budget cycle.”
Finding additional funding for transportation was a top priority among legislators in this legislative session. TxDOT needs about $5 billion annually to keep up with current demands, said Veronica Beyer, director of media relations for TxDOT.
Even with the approval of Proposition 1 last November, state transportation funding still falls short of the projected $5 billion needed annually to keep up with a rapidly escalating population and aging infrastructure.
“As Texas grows by more than 1,000 people daily, we are seeing more congestion and therefore an increasing need to build, repair and maintain our roadways,” Beyer said. “To be able to keep up with this increasing demand, it was imperative we find a sustainable funding solution for our state. Transportation is the backbone of economic prosperity, so we must do what we can to keep commerce and goods moving.”
State Sen. Robert Nichols, R-Jacksonville, said with the progress made by the Legislature last session to fund transportation, the overwhelming support of Prop. 1 by voters last November and legislation passed this session, the state’s transportation funding is going to be close to where it needs to be.
“I am very excited that the House, Senate and Governor were able to come together on SJR 5, which is critical for the future of transportation in our state,” Nichols said.
How SJR 5 came to be
Both the House of Representatives and Senate proposed transportation funding bills using sales tax revenue to provide funding to the SHF.
Nichols co-authored SJR 5 in February. The bill would have dedicated the first $2.5 billion of motor vehicle sales tax revenue every year to the general fund, the second $2.5 billion to the SHF and split any remaining revenue between the two, Haywood said.
House Bill 13, authored by state Rep. Joe Pickett, D-El Paso, suggested dedicating $3 billion of general sales tax revenue to the SHF in addition to 2 percent of the remaining sales tax revenue.
Both bills received nearly bipartisan support and were approved by their respective chambers. Haywood said the House and Senate each sent five members to a conference committee to hash out the legislation and come up with one bill that satisfied both chambers. The result was a compromise of both bills that was still dubbed SJR 5.
