Douglas considers transportation bond

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(Host) Governor Jim Douglas says he’s willing to consider issuing bonds to help finance some of the maintenance demands of the state’s transportation infrastructure.

But the governor says this has to be done without expanding the overall bonding capacity of the state.

VPRs Bob Kinzel reports.

(Kinzel) According to a report issued by the Agency of Transportation, the percentage of state roads that are in "very poor condition" will increase dramatically over the next five years if current funding levels are maintained.

Right now the Agency says 20 percent of all Vermont roads are in very poor condition. This number is projected to jump to more than 35 percent by 2012 unless there are significant increases in the paving budget.

Some lawmakers want the state to issue a special transportation bond to provide a large amount of money in the short term to help repair the state’s transportation infrastructure.

Speaking on VPR’s Vermont Edition, Douglas says he isn’t opposed to a special transportation bond as long as the project doesn’t increase the bonding capacity of the state:

(Douglas ) "My concern is the overall level of bonded indebtedness. So we have to make some choices. We have to establish some priorities if transportation projects are more urgent for bond proceeds then we’ll have to defer something else whether it’s school construction projects or water and sewer plants or state buildings improvements — whatever it might be that comes out of our capital budget. But I’m certainly willing to consider bonding."

(Kinzel) Another proposal to boost transportation revenue would change the structure of the state gas tax. Right now it’s set at 20-cents a gallon. Some lawmakers want to consider implementing a percentage tax on gas. It would be similar to the way the sales tax and the rooms and meal tax are currently imposed.

Douglas thinks there are problems with this approach:

(Douglas) "That idea has been suggested in the past. I think the problem with it is the price of gas is so volatile when it goes up we’d get a lot more money to be sure. But we’ve seen the price of gasoline drop precipitously at various points in recent years and then our revenue would decline."

(Kinzel) Douglas says it would be possible to allocate more money for transportation projects if the state Transportation Fund didn’t have to pay for a number of programs that have little connection to the fund.

The governor says he’ll ask lawmakers to study this issue when they return to Montpelier in January.

For VPR News, I’m Bob Kinzel in Montpelier.

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