LAST MONTH, Treasurer Curtis Loftis’ office suggested that credit-rating agencies would look askance at a road-repair plan that simply raided the general fund, since state revenues still haven’t recovered to pre-recession levels. The office suggested that a proposal by the Senate Finance Committee would raise fewer concerns because in addition to raiding general funds, it also raised taxes and fees. But that plan won’t be considered until next year, and Gov. Nikki Haley has made it clear she has no interest in any tax hikes.
So, with our highways and bridges continuing to deteriorate, and the business community demanding action, what do our lawmakers do? Precisely what the treasurer’s office said could get us into trouble. The Senate voted to divert $50 million a year from the general fund; the House voted to divert $41 million next year and $83 million a year thereafter.
From there, it just gets worse.
Even if we had plenty of money to pay for schools and police and courts and child protection and other essential state services while also maintaining and repairing our neglected highways and bridges, it wouldn’t make sense to give it to the Transportation Department without also correcting some of the agency’s flaws. At the top of that list: requiring it to adhere to a priority list based on objective criteria, rather than continuing the parochial horse-trading that always has marked our highway program.
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Yet instead of doing that, the Senate gives the money to the one entity that is more out-of-control than the Transportation Department: the State Infrastructure Bank.
The Infrastructure Bank is controlled by House Speaker Bobby Harrell and Senate President Pro Tem John Courson. Until Glenn McConnell resigned last year as president pro tem to become lieutenant governor, both of the appointers were from Charleston County, which helps explain why the bank voted last year to commit bonding capacity that it won’t even have for a decade to a Charleston County project that the county doesn’t want, and that didn’t make the state’s transportation priority list. We can’t maintain the roads we have, and a bunch of political appointees is trying to force a $558 million road project on a county that doesn’t want it.
Senators say they needed to get the money to the Infrastructure Bank because it has the authority to issue bonds — that is, to use the $50 million a year to borrow 10 times that much so we can make the repairs up front and pay for them over time. But entrusting the money to this entity is a bad idea even if you think the bonding plan is a good idea — and it’s hard not to recall the Transportation Department’s disastrous “27 in 7” program that maxed out its bonding capacity to build new roads, helping to get us in the fix where we can’t afford to maintain and repair them.
The House budget doesn’t direct its $41 million in diverted funds to the Infrastructure Bank, but it does leave in place the Senate language to do that with other funds — which suggests that House negotiators intend to agree to the Senate’s raid. They shouldn’t, and senators shouldn’t agree to the House’s raid. If legislators insist on throwing money at a new highway repair plan before they’ve worked out the details, they should stick with the House’s other, more limited idea, of using surplus and other one-time revenue. That has the advantage of clearly being a stopgap measure.
And none of that money should go to the Infrastructure Bank. The only thing lawmakers ought to be doing with the Infrastructure Bank is dismantling it.