Stakes Are High for O.C. in Highway Fund Battle

In 1944, when citrus groves and bean fields were the icons of an Orange County rich in open space and free of choking traffic, Congress decided to build a new network of federal highways that promised to speed people and cars to destinations in ways no one had yet dreamed possible.

Nearly 50 years later, the $122-billion, 42,500-mile system of federally funded interstate highways is all but complete. As gridlock becomes a daily reality, Congress is poised to begin the most significant revision of the country’s national highway program in more than 30 years.

At stake for densely populated, traffic-clogged urban centers like Orange County is nothing less than the quality of their economic and social development, say local, state and national officials who are working to influence the new federal policy.

“We’re at the crossroads,” said Rep. Ron Packard (R-Carlsbad), a member of the House Public Works and Transportation Committee, whose 43rd Congressional District includes southern Orange County.

“It is very much a watershed,” said Francis B. Francois, director of the American Assn. of State Highway and Transportation Officials. “And these watersheds come along once in a generation.”

The battle in Congress is expected to last at least through next year, and possibly into 1991.

The lexicon of this transportation war will include buzzwords like smart car , block grant , demand management , HOV lane , transit corridors , congestion tax , mobility study , user fee and private sector . But in the end, the keyword is likely to be money .

“Because of the lack of funds . . . over the last several years, highway construction and highway improvement has been lagging behind, and of course Southern California feels the pressure,” Packard said. “We’re going to have to develop a blending of several approaches to highway funding.”

By way of example, a study released this summer projects that in the next 20 years traditional local, state and federal funding sources will fall short of providing enough money to meet Orange County’s transportation needs by as much as $12.4 billion.

To bridge the gap, the county must look increasingly to private investment in roads and transit systems, said Monte R. Ward, manager of government and community relations for the Orange County Transportation Commission. But current federal law, fashioned largely in an era of government largess, severely frowns on mixing federal money with private funds.

Many Orange County officials said they want the federal government to loosen the strictures on the way local governments can spend federal highway and mass transit dollars. Instead of building roads, the federal government should be concerned with moving people, the officials said.

“What we’re looking at is maintaining and upgrading our existing freeway facilities, and then looking at newer and more flexible ways of moving people,” Ward said. That may include car-pool lanes, rail systems, ride sharing, work schedule changes and even home work stations, he added.

“One day we are going to have to get out of our cars and move people in a better way than we are doing today,” said John Meyer, the former executive director of the Orange County Transportation Corridor Agencies, which are working to build three new toll roads.

The current system of federal funding dates to 1956, when Congress created a special highway trust fund to finance construction of the interstate highway system. A separate account to pay for mass transit projects was added later.

The trust funds are supported with receipts from the 9-cent-per-gallon federal tax on gasoline and other highway-related taxes. Eight cents of the gas tax receipts go to the highway fund, while the transit fund receives a penny. In the fiscal year that ended on Sept. 30, 1988, highway fund revenues exceeded $12.8 billion, and transit fund income totaled nearly $1.3 billion.

For more than 30 years, the highway trust fund has supportedconstruction of the interstate highways. It also has paid for other state and local road-building projects through a series of complex matching formulas that financed bridges and primary, secondary and urban roads.

Authority for the federal aid program for highways and mass transit, last enacted by Congress in 1987, is set to expire at the end of the 1991 fiscal year. The program that replaces it is expected to be a dramatic departure from the funding schemes of the past.

“What we have to do now is look at what our transportation system should look like in the next 40 years,” said one key congressional staffer.

The process will begin sometime before Christmas, when the surface transportation subcommittee of the powerful House Public Works and Transportation Committee is scheduled to hold the first in a series of hearings. Packard is a member of the subcommittee, as is freshman Orange County Rep. C. Christopher Cox (R-Newport Beach).

The Public Works Committee expects to draft legislation early next year.

At about the same time, Transportation Secretary Samuel K. Skinner is expected to unveil a national transportation policy that his office has been preparing since last spring. Legislation to implement the policy will probably follow in a few months, said James McCarthy, chief of policy evaluation for the Federal Highway Administration.

At the moment, McCarthy said, “What the post-interstate system will look like, we don’t know.”

But there is no dearth of speculation.

Some members of Congress, including Rep. Dan Rostenkowski (D-Ill.), chairman of the House Ways and Means Committee, want to increase the federal gasoline tax, not to build more roads, but to cut the federal deficit.

Congress already has adopted a practice of maintaining healthy balances of unspent gasoline tax money in both the highway and mass transit trust funds. At the end of the 1988 fiscal year, those balances totaled about $14.4 billion. One congressional staff member called it a “smoke and mirrors” trick to make the deficit appear smaller than it really is.

Local and state transportation officials, as well as members of the House Public Works Committee, strongly oppose the use of gasoline tax revenues to shore up the federal budget.

“I’d like to see them release the $14 billion they’re sitting on right now. That’s really our biggest concern,” said Ernie Schneider, director of Orange County’s Environmental Management Agency, which has road-building responsibilities. “We’re in a desperate situation here . . . we need relief.”

Said Cox: “It would do irreparable damage to our national infrastructure to do what Dan Rostenkowski wants to do with the trust fund, and that is to steal from it. There is an important national need, and it must be met.”

Cox represents one school of conservative thought that favors turning over to states, or regional transportation planning agencies, large portions of the federal gasoline tax revenues through a block grant program.

“To think there is any repository of knowledge back here in Washington about where roads ought to go in Orange County is to miss the point entirely,” Cox said.

Without committing himself, Packard said the idea has some appeal. Even California Rep. Glenn M. Anderson (D-San Pedro), chairman of the Public Works Committee, has flirted with the notion of block grants.

In a speech last month in Anaheim to members of the Amalgamated Transit Union, Anderson said: “One much discussed alternative assumes the creation of a block grant program, which would allocate funds by formula to urbanized areas, provide for ongoing funding for existing programs, and then allow the use of federal funds for either highway or transit purposes based on the need for increase in transportation capacity.”

But many in Congress are likely to oppose block grants because lawmakers would have to surrender much of their life-and-death power over hometown public works projects, several congressional aides said. “A lot of congressmen still want their name on the bridge,” one aide explained.

In addition, congressional representatives from rural areas are likely to fear that block grant money would flow to centers of urban and suburban congestion, largely at their expense.

Even if a block grant program is not enacted, Orange County transportation officials said they will push Congress to allow them to use federal aid for highways and transit with much greater flexibility than ever before.

WHAT’S NEXT

The future of federal funding for highways into the 21st Century will be developed by Congress in a process to begin this fall. The process will begin with hearings by a subcommittee of the powerful House Public Works and Transportation Committee.

NEEDED TRANSPORTATION IMPROVEMENTS AND COSTS

The Orange County Transportation Commission has identified the top transportation needs of Orange County during the next 20 years as three tollways in South County, the widening of the Santa Ana Freeway from 6 to 12 lanes with transitways for buses and car pools, and repaving and signal synchronization projects on surface streets.

But improvements would cost $12.4 billion more than revenue now projected to be available during that time period, according to the commission.

In thousands of dollars, through July 1989

Near Term Mid Term Long Term Total 1989-1993 1994-1998 1999-2008 1989-2008 FREEWAY PROGRAM Program cost $2,048,374 $3,108,783 $1,354,824 $6,511,981 Projected revenue 1,796,303 1,233,399 412,368 3,442,070 Estimated shortfall 252,071 1,875,384 942,456 3,069,911 STREETS AND ROADS PROGRAM Program cost 1,803,540 1,473,173 2,844,865 6,121,578 Projected revenue 966,512 668,264 1,020,976 2,655,752 Estimated shortfall 837,028 804,909 1,823,889 3,465,826 TRANSIT PROGRAM Program cost 874,210 824,050 6,529,540 8,227,800 Projected revenue 559,715 544,315 1,233,040 2,337,070 Estimated shortfall 314,495 279,735 5,296,500 5,890,730 TOTAL PROGRAM Total program cost 4,726,124 5,406,006 10,729,229 20,861,359 Projected revenue 3,222,530 2,445,978 2,666,384 8,434,892 Estimated shortfall 1,403,594 2,960,028 8,062,845 12,426,467

Source: Orange County Transportation Commission