Transportation battle looms at Colorado Capitol

Proposal could involve new fees on gas purchases, ride-sharing apps and delivery services

By: - February 26, 2021 6:30 am
transportation

As of 2020, the transportation sector is Colorado’s largest source of greenhouse gas emissions, according to state estimates. (Chase Woodruff/Colorado Newsline)

This year, Colorado lawmakers hope to avoid another dead end on transportation — but the road ahead looks bumpy.

As Democrats in the Legislature work to develop a plan that would meet the state’s infrastructure needs, they must confront challenges on multiple fronts: resistance from lawmakers and constituents to levying new fees; pressure to improve the state’s air quality while simultaneously funding needed maintenance for highway infrastructure; and wide-ranging concerns of city and county leaders in Colorado’s local-control landscape.

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Four Colorado Democrats — House Speaker Alec Garnett, Senate Majority Leader Steve Fenberg, state Rep. Matt Gray of Broomfield and state Sen. Faith Winter of Westminster — are leading efforts to craft a transportation proposal that would overhaul how the state pays for transportation projects. This would reportedly include new fees for consumers on gas purchases, as well as fees for new players in the transportation sector: ride-sharing companies and delivery services.

The state’s top Democrats, including Gov. Jared Polis, say the deal is needed to help pay for billions of dollars of unfunded projects identified by the Colorado Department of Transportation in its 10-year strategic plan. They also want more money to help cities and counties maintain and expand their road infrastructure, and to pay for local and regional public transit projects.

But the lawmakers developing a transportation package haven’t provided much detail about the gas fees under consideration or how much money they’d raise, and drafts of the legislation haven’t been made public.

Moreover, Colorado taxpayers have soundly rejected new statewide taxes to raise transportation dollars — most recently in 2018 with the defeat of Proposition 110. Under the constitutional amendment known as the Taxpayer’s Bill of Rights, or TABOR, state lawmakers and local leaders cannot raise taxes without voter approval.

Two years after rejecting a tax for transportation projects, Colorado voters approved Proposition 117 in 2020 to require voter approval of fees for new state enterprises, and passed Proposition 118, an across-the-board income tax cut.

House Republicans protest lack of transparency

In a Feb. 24 statement, House Republicans accused Democrats of keeping key details of the upcoming transportation package “under wraps.”

“While they continue to have conversations about transportation and have had multiple stakeholder meetings, there has been zero transparency about the specifics surrounding their proposal,” the statement said. It went on to cite a recent poll conducted by Americans for Prosperity, a conservative advocacy organization, that showed 56% of voters in key Colorado Senate districts did not approve of a gas fee.

“While they continue to have conversations about transportation and have had multiple stakeholder meetings, there has been zero transparency about the specifics surrounding their proposal.”Statement from state House Republicans on Democrats’ transportation plan 

The organization polled 150 voters in each of five districts: Senate Districts 19 and 22 in Jefferson County, and Senate Districts 21, 24 and 25 in Adams County. All are represented by Democrats except for Senate District 25, where Republican Sen. Kevin Priola of Brighton won reelection in November.

Of the 750 people polled by Americans for Prosperity, 38% said they were in favor of a fee on gas purchases to fund transportation and infrastructure projects, with 23% somewhat in favor and 15% strongly in favor. Meanwhile, 42% said they strongly opposed the idea, and 14% were somewhat opposed.

“Despite the clear desires of the voters, Democrats’ undisclosed suggestion of a fee on a gallon of gas would bypass voters unlike a tax hike that would have to appear on the ballot,” the Republicans’ statement said.

The Democrats crafting the proposal say they’ve sought feedback from a variety of business groups and local leaders.

Fenberg, Garnett and Senate President Leroy Garcia, a Democrat from Pueblo, joined Polis, CDOT Executive Director Shoshana Lew and a slate of local leaders on Feb. 22 for a Zoom panel on transportation policy and funding.

While the state lawmakers were light on specifics, some common themes that emerged from the conversation included balancing the needs of rural and urban areas of the state, maintaining local control of funding priorities, and finding ways to make transportation funding sustainable.

Changing how transportation gets funded

Most of the state’s funding for transportation comes from a flat tax levied on fuel purchases, first implemented in 1991. Approximately 61% of the tax revenue is used to fund state projects, while 39% goes to cities and counties to fund their desired local projects.

But as more people turn to electric cars and buy less gas, state legislators are looking for other ways to fill CDOT’s funding backlog.

“Generally speaking, we want to make sure that we have a sustainable revenue source,” Fenberg said in an interview Feb. 17. “Right now, by relying entirely on the gas tax almost entirely, as people have more efficient cars or drive electric vehicles, that money diminishes over time.”

Gov. Jared Polis
Gov. Jared Polis arrives to deliver his State of the State in the House chambers at the state Capitol Building on Feb. 17, 2021. (Pool photo by AAron Ontiveroz/The Denver Post)

Fenberg noted that the tax hasn’t been adjusted for inflation over the past three decades. It’s stayed at 22 cents per gallon since 1991.

“We’ve actually lost money over the course of those 30 years, because the purchasing power has decreased,” he said.

During the Zoom panel, Fenberg acknowledged that Coloradans might be skeptical about paying additional taxes for roads and transit.

“I think Colorado voters, they have a little bit of — they’re a little guarded when we say, give us some money for transportation, because there have been some problems,” he said, citing the elusive FasTracks rail line that was supposed to run from Denver to Boulder to Longmont. When metro voters back in 2004 approved a 0.4% sales tax to pay for that Northwest Rail Line and other Regional Transportation District projects, they expected the rail line would take 12 years to finish. Recently, officials have questioned whether the project is needed at all.

In crafting their proposal, lawmakers will have to decide where to infuse one-time money into transportation and how to permanently redesign the funding formula. And there’s likely to be some debate about how to split the money between urban and rural Colorado.

For example, one of the fees legislators are considering would be levied on ride-sharing companies, such as Uber and Lyft, that transport commuters using the state’s infrastructure.

To mayors of Colorado’s metro-area cities — where people are most likely to use Uber and Lyft — it would make sense to distribute a majority, perhaps 75% of that ride-sharing fee revenue to the state’s five Metropolitan Planning Organizations, said Lone Tree Mayor Jackie Millet. Those MPOs are located in Denver, Grand Junction, Fort Collins, Colorado Springs and Pueblo.

“We think a direct share-back to the state’s five MPOs would make a difference on climate, air quality, safety, mobility and … equity challenges facing the 83% of the state’s population that resides within one of those five MPOs,” Millet said during the Zoom panel. “The vast majority of any new fees and taxes will be paid by those individuals.”

An RTD bus heads west on Colfax Avenue at Logan Street in Denver on Dec. 21, 2020. (Quentin Young/Colorado Newsline)

Cities and counties want decision-making power

While Democratic leaders — who have control of both chambers of the state Legislature and the governor’s office — have said they want to fund everything from transit projects to wildlife crossings with the new transportation money, Colorado’s current transportation funding formula allows mayors and county commissioners considerable autonomy in determining how they use their share of the gas tax revenue.

“It takes partnerships, it takes regionalism and it takes flexibility for local government when we look at funding,” Adams County Commissioner Kelly Baca said during the Zoom panel. “And I wouldn’t mind looking, to go back and look at the funding formula.”

She pointed out that the Denver Regional Council of Governments recently changed its own funding formula to allocate Adams County $30 million more a year for local projects, “and that was just a matter of looking at what will work for Adams County now … instead of using a formula that maybe we’ve looked at in the past.”

Baca said she hoped the new transportation plan would allow local governments the flexibility to partner with neighboring communities when it makes sense.

Localities want as much of a say as possible in decisions involving which projects get funded, said Eric Bergman, policy director for Colorado Counties Inc., which advocates for counties across the state.

“Local government has been at the table on this issue for more than a decade, and we are dedicated to finding a statewide solution that will provide a stable, predictable and flexible funding stream to enhance and modernize our transportation system,” Bergman wrote in an email.

Of transportation, Bergman said: “There might not be a more important conversation happening under the Gold Dome this year.”

Local governments finding their own solutions

Polis cautioned that the danger of failing to provide new statewide funding for transportation is that it could create more disparities between communities that could raise their own dollars — through ballot initiatives or out of their general funds — and those that couldn’t.

“We don’t want to see a patchwork or a hodgepodge within this state” of transportation infrastructure, he said during the Feb. 22 panel.

But in recent years, some Colorado cities and counties have already gone to their voters to ask for dollars they weren’t getting from the state.

In Colorado Springs — where Mayor John Suthers successfully encouraged voters to pass ballot initiatives raising funds for road maintenance — the “shortfall in road funding was affecting our competitiveness with other cities,” El Paso County Commissioner Holly Williams said.

Williams said she agreed with statements made by Polis that Colorado would lose investment to neighboring states with better infrastructure if legislators didn’t find a statewide solution to fund transportation.

House Speaker Alec Garnett
House Speaker Alec Garnett delivers a speech on the first day back at the Colorado Capitol on Feb. 16, 2021. (Faith Miller/Colorado Newsline)

In the mountains of Colorado, some local governments have their own voter-approved initiatives not for road maintenance but public transit.

Dan Caton, mayor pro tem of Mountain Village in San Miguel County, pointed out that many rural areas of the state are already thinking creatively about how to reduce air pollution and traffic congestion. The San Miguel Authority for Regional Transportation, for example, was established and funded in 2016 by voters in Telluride, Mountain Village and the R-1 School District of San Miguel County.

The regional transportation authority currently operates a gondola to funnel locals and tourists between Telluride and Mountain Village.

But, Caton said, local funding only goes so far.

“Like other rural communities, we rely heavily on funding from the state,” he said. “To build to our vision of a safe, coordinated and environmentally responsible system, we need the state to commit increased funds that are committed over years.”

He recommended legislators include more money for CDOT’s Multimodal Options Fund in their forthcoming transportation package.

“As we replace our aging buses with more expensive electric vehicles, as we increase safety by widening roads and installing better bike lanes, and as we consider improving our replacing our 27-year-old gondola system, we desperately need state help,” Caton said.

Improving air quality by reducing transportation emissions — one of legislators’ key goals for their upcoming package — will mean investing in better public transit as well as new infrastructure for electric vehicles, Eagle County Commissioner Matt Scherr said during the panel.

“We’ve done transit for a number of years,” Scherr said. “The citizens of Eagle County years ago voted to tax themselves to pay for our transit system, and Colorado actually has the greatest number of large rural transit systems in the U.S. About half of those in the state are in just Eagle and Pitkin counties alone, so we do have considerable experience with transit.”

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Faith Miller
Faith Miller

Reporter Faith Miller covers the Colorado Legislature, immigration and other stories for Colorado Newsline.

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