- Why do we need a Blue Ribbon Task Force?
- What will the Task Force do?
- Why is NDOT concerned about a shortfall starting in 2008? That’s some time from now.
- Why is NDOT expecting a shortfall if we already have the fifth highest gas tax in the nation?
- With all that extra travel, haven’t fuel tax revenues risen?
- Aren’t gas and diesel prices too high to consider increasing fuel taxes?
- Why are Nevada’s fuel taxes higher than most states?
- What are the Task Force and NDOT doing to control the use of vehicles and encourage mass transit or other environmentally friendly solutions?
- If the state needs more money, why did they rebate our vehicle registration fees?
- Where does NDOT’s money come from?
- Where does NDOT spend its money?
- How does NDOT control project costs?
- How does NDOT determine whether a project is worth doing?
- Why does NDOT repave roads that appear to be in good condition? Doesn’t that waste money?
- Couldn’t you just cut NDOT’s workforce?
- Couldn’t NDOT be privatized?
- I live in Las Vegas. Why should I pay for roads in Elko?
- I live in Elko. Why should I pay for growth in Las Vegas?
Why do we need a Blue Ribbon Task Force?
While the Nevada Department of Transportation is under way with its largest highway construction program ever, beginning in 2008 there are many more projects that will be necessary to keep pace with the tremendous growth of the state. By 2015, NDOT is projecting a $3.8 billion shortfall for needed road projects. To help with this issue, Governor Kenny Guinn and the State Transportation Board created a Blue Ribbon Task Force in June 2005. Its charge is to develop proactive solutions to establish the foundation for addressing Nevada’s future transportation needs.
What will the Task Force do?
The Task Force will review the need for future NDOT projects, including impacts to congestion relief, the cost of maintaining the existing infrastructure, safety improvements, fatality reduction, and maintaining the quality of life and economy of Nevada. The Task Force also will review project costs and revenue projections and evaluate funding options. The Task Force members comprise a diverse group of individuals across geographic and business sectors. The Task Force is expected to convene monthly and issue recommendations in the summer of 2006.
Why is NDOT concerned about a shortfall starting in 2008? That’s some time from now.
NDOT is working on future projects that we plan to have under construction in 2008 and completed by 2015. To acquire the necessary right-of-way for capacity improvements, prepare plans for construction, and allow for advertising and the bid award process, funding needs to be in place. To meet these additional financial needs, any changes to existing revenue sources, or the addition of new ones, will require legislative and gubernatorial approval. The earliest this could take place would be 2007. The work of the Task Force is to review the needs and recommend solutions.
Why is NDOT expecting a shortfall if we already have the fifth highest gas tax in the nation?
Two main reasons: 1) costs are increasing dramatically (the cost of pavement rehabilitation alone has increased by as much as 47% from 2003 to 2005) while the funding mechanisms remain stagnant; and 2) revenues have not matched the increased use of the highway system. The bulk of NDOT’s money comes from fuel taxes and registration fees, which were last increased in 1992. Since then, general inflation has risen 41.7% and construction costs have increased even more.
The U.S. Bureau of Labor Statistics reports that highway and street construction costs have increased 32.1% since December 2002. Road-building components have soared in the same time frame:
- Diesel fuel, up 163.8%;
- Steel mill products, up 75.6%;
- Asphalt, up 41.3%;
- Fabricated structural metal, up 28.2%; and
- Ready-mixed concrete, up 22.4%.
Similarly, right-of-way prices for road expansion projects, like the housing market in Southern Nevada, have skyrocketed. Estimates are that statewide, real property is appreciating somewhere between 10% and 20% per year. For the current year, NDOT’s acquisition budget for land, improvements and interest is $79 million, so the percentage yearly increases total $7.9 million to $15.8 million. Most of the proposed projects to reduce congestion in Las Vegas and Reno are well into environmental review and planning, and will require significant right-of-way, making these projects extremely expensive. Future projects also will require amenities such as landscaping and noise walls to ensure compatibility with community values. All of this significantly reduces available funding for much-needed road projects.
With all that extra travel, haven’t fuel tax revenues risen?
Yes, but that traffic creates additional road needs. Nevada has led the nation in growth for decades. But the number of miles driven on our roads has increased at a pace even greater than that. By 2010, Nevada’s population is expected to swell to 2.8 million, an increase of 127% since 1990. In the same time frame, the miles traveled on Nevada roads are expected to increase 151%. Because of these statistics and more fuel-efficient and alternative fuel/hybrid vehicles, the state revenues per mile driven have actually decreased.
Aren’t gas and diesel prices too high to consider increasing fuel taxes?
Fuel taxes are not the only potential solution being considered. Others include, but are not limited to, raising registration and driver’s license fees for the first time since 1992, and public-private partnerships, where public works would be financed and/or controlled by private entities. The option of not increasing taxes or fees, and instead allowing congestion to worsen, also will be considered.
Why are Nevada’s fuel taxes higher than most states?
Nevada’s combined federal and state gasoline tax is currently the 14th highest in the nation at 42.4 cents per gallon. However, since Nevada’s counties also have a 6.35 cents per gallon of gas mandatory tax and an optional gasoline tax of up to 9 cents per gallon, this combined with the federal and state tax totals 52 cents per gallon, the 5th highest in the nation.
What are the Task Force and NDOT doing to control the use of vehicles and encourage mass transit or other environmentally friendly solutions?
NDOT works very closely with the regional transportation commissions in southern Nevada, Washoe County, Carson City, and Lake Tahoe, which are responsible for mass transit. NDOT also is installing high occupancy vehicle lanes on U.S. 95 in Las Vegas.
If the state needs more money, why did they rebate our vehicle registration fees?
The rebate was for a tax on business, whereas NDOT’s revenue has been from fees paid by users of the state highway system.
Where does NDOT’s money come from?
State highways maintained by the Nevada Department of Transportation are financed with dedicated highway-user revenue and federal funds. No General Fund (general tax) revenue is used. State and federal highway funds are principally derived from vehicle fuel tax and registration fees. A complete overview of NDOT’s financing can be found on pages 13-30 of the 2005 Fact Book.
How does NDOT control project costs?
Similarly, a complete overview of NDOT’s expenditures can be found on pages 13-30 of the 2005 Fact Book.
Where does NDOT spend its money?
When practical, NDOT uses public lands to reduce right-of-way costs and provide construction materials like earth fill and aggregates. In the design process, large projects are value engineered, whereby a multidisciplinary team brainstorms and evaluates creative ways to accomplish the project objective, usually resulting in substantial savings. NDOT’s greatest expenditure is construction contracts, which are awarded to the lowest responsible bidder. Rigorous specifications and testing assure that contractors deliver the product for which the public paid. Asset management systems are used to track and optimize the performance of our pavements, bridges, routine maintenance, and equipment. For both construction and maintenance activities, budgets are set, costs are rigorously tracked through audits and inspections, and changes to projects carefully scrutinized.
How does NDOT determine whether a project is worth doing?
NDOT works closely with city and county officials, county commissioners, road superintendents, tribal councils, and regional transportation commissions to identify needs based on many factors, including safety and congestion. Potential projects are further evaluated based on benefit-cost ratios and available funding and are reviewed by a statewide committee comprised of federal, local, and state agencies and entities before presentation to State Transportation Board for final approval. Further information can be found in the Program Development Manual. The pavement rehabilitation program is prioritized based on financial consequences and public safety concerns. Roads such as I-80 with high truck volumes and rapid rate of deterioration receive the highest priority. If interstate rehabilitation projects are delayed by two years, the cost of rehabilitation increases by a factor of five. This means a 10-mile section of I-80 that can be rehabilitated this year for a cost of $6 million will cost $30 million in two years. Low volume roads, on the other hand, can be delayed for several years with only a minimal increase to the rehabilitation costs. Therefore, roads with the highest rate of deterioration will be addressed first. The goal is to ultimately address the needs of the entire state-maintained system.
Why does NDOT repave roads that appear to be in good condition? Doesn’t that waste money?
NDOT’s concept for pavement rehabilitation is similar to changing the oil in your car every 3,000 to 4,000 miles, or painting the exterior of your house before the wood is damaged. By fixing the roads when pavement reaches an optimum service life rather than waiting for pavement distresses to appear (failure point), NDOT can save up to $42 million annually. The traveling public can save several times this amount because there are no potholes and the roads are smoother. Therefore, the wear and tear on your vehicle is reduced so your maintenance needs are less.
When even modest pavement distresses appear, the cost to repair a road skyrockets. Since 1997, NDOT has employed a proactive approach of repaving a road before these distresses appear, producing significant savings. Based primarily on pavement age, traffic volume, and traffic loads, we can predict when distresses will appear and repave a road before that happens. This proactive plan has saved taxpayers an average of $42 million per year, while keeping our pavement in great condition. In fact, Nevada is No. 1 in the country with the greatest percentage of roads on the National Highway System in the smooth category, according to Federal Highway Administration standards. NDOT has an exceptional road preservation and maintenance program, acknowledged as one of the best in the country. Further information can be found in the State Highway Preservation Report.
Couldn’t you just cut NDOT’s workforce?
Since 1985 NDOT’s workforce has increased 24 percent, while the state’s population has increased 150 percent. More importantly, vehicle miles of travel has increased 190 percent. Because of the increasing demands on existing NDOT roads, as well as the need for new and expanded highways, cutting the workforce would not be economically prudent, nor would it provide enough money to meet the projected needs.
Couldn’t NDOT be privatized?
Most of NDOT’s work already is–nearly all construction and about one-half of all road design work are privatized. In 2004, just 15 percent of NDOT expenditures were for administrative costs.
I live in Las Vegas. Why should I pay for roads in Elko?
Nevadans need to have a state highway system. For example, Interstate 80, which runs through Elko, is the major east-west corridor in the nation and the traffic contributes greatly to the economy of the entire state, not just to one section of it.
I live in Elko. Why should I pay for growth in Las Vegas?
Those who live outside of Las Vegas would not likely pay for growth in Las Vegas. There are 5,449 centerline miles of state highways that NDOT must maintain and keep safe, most of which are not in Las Vegas.
