Davis’ Road Funding Plan Criticized

Gov. Gray Davis’ proposal to ease traffic gridlock by pouring $3 billion more into road projects was greeted with skepticism Monday as lawmakers complained that he wasn’t really adding more money but only playing with numbers.

“It’s all smoke and mirrors,” said state Sen. Jim Brulte (R-Rancho Cucamonga). “There’s no there there. It may be good politics but it’s not good policy.”

Even on the Democratic side, lawmakers characterized the transportation portion of the governor’s budget proposal as weak and “in need of more work.”

“[It] will not do the job,” said Senate President Pro Tem John Burton (D-San Francisco), adding that it is the area of the governor’s spending plan where the Legislature is most likely to make major changes.

Davis’ critics have put forth their own transportation proposals, some of which would conflict with the governor’s plans.

As the state sits awash in billions of dollars of surplus revenue, Davis has been under pressure to increase spending for transportation and expedite road projects to ease congestion in California’s most heavily traveled corridors.

The recession of the early 1990s, plus the need to devote billions of dollars to seismic retrofitting of bridges, caused the state to fall far behind in meeting the needs of the traveling public. Last year, California motorists spent 836,000 hours each day in freeway traffic jams, draining an estimated $7.8 million a day from the economy in lost work hours and pollution cleanup costs.

In his State of the State address last week, Davis promised “$3 billion in new funds” for roads, highways, intercity rail and other items, but did not identify a source for the money.

On Monday, he released proposals that would not use any of the surplus for transportation but provide for the next budget year with a “use-it-or-lose-it” policy that allows the state to take back previous years’ unspent road-building money from local government. Under that policy, local governments that have not used money allocated for road projects by July 31 would lose it.

A second prong of the governor’s proposal calls for issuing bonds that would allow the state to borrow against transportation revenue that would normally become available in 2005, 2006 and 2007.

Both proposals were immediately unpopular with lawmakers, especially Republicans, who complained that it would be unfair to take unspent funds from local governments because many of the road projects have been held up by federal and state requirements for things like environmental studies.

“If this happens, it will be the single largest confiscation of local dollars that we have ever had in this state,” said Scott Baugh (R-Huntington Beach), leader of the Assembly’s Republicans.

He noted that Caltrans itself has been slow in getting projects off the ground and as a result has amassed $2 billion in unused funds.

A staff analysis circulated to members of the Senate accused the governor of inflating the size of the unspent funds. It said Davis wrongly claimed that $1.7 billion had not been spent by local agencies when in reality it is no more than $350 million. His reference to $1.7 billion “cannot be explained,” the document said.

Davis’ finance director, Tim Gage, said the $1.7 billion represents several sources of unspent money, including federal funds and local gas tax revenues. “The issue is not so much that the governor wants to take this money away,” he said. “The goal . . . is to get it spent more quickly, to get them off the dime.”

But for many lawmakers, the most controversial part of the governor’s proposal is his suggestion that the state borrow from the future to pay for projects in the present.

Brulte predicted that the proposal would increase the cost of road projects and leave the state little revenue for transportation projects in the years just after Davis leaves office, assuming he serves two terms.

He said the infusion of so much additional spending now would encourage contractors to bid up the price of projects. At the same time, he said, the state would have to absorb the interest on the bonds.

The Republicans have suggested devoting $1 billion of the surplus to transportation and passing legislation that would empower the governor to eliminate some of the red tape that now bogs down projects.

Burton is the author of a proposed constitutional amendment (SCA 3) that would reduce from a two-thirds to a simple majority the vote needed to raise the sales tax a half-cent for local transportation projects.

Times staff writer Carl Ingram contributed to this report.