Building momentum: Could Missouri follow North Carolina and Georgia?

Karen

In Winston-Salem, North Carolina, construction on the Interstate 74 Northern Beltway is ramping up. Workers are moving dirt, laying asphalt, and building roads and bridges.

When completed, the I-74 urban loop will link central North Carolina and Virginia with Winston-Salem. The project could double economic growth in the area, according to one study. By itself, the interstate construction will create 33,800 jobs and add $2 billion in economic activity.

The I-74 Northern Beltway project — decades in the making and once stalled because of funding shortfalls — is part of a wave of new construction under way in North Carolina after a series of legislative reforms that will eventually create $1.5 billion in new annual funding for the Tar Heel State.

“This project had been on the books for a very long time, but the recent changes in our distribution formula and the addition of new money helped accelerate the project,” said Jake Cashion, director of governmental affairs at the North Carolina Chamber. “Its full completion has been moved up by years. It will have a huge impact on the state and regional economy.”

In many ways, Missouri is today what North Carolina once was: a state with a long list of needed transportation projects but no viable source for the funding infusion needed to complete them.

As Missouri continues to contemplate ways to increase transportation funding, it’s worthwhile to look at other states that have found ways to invest in their systems.

In North Carolina, a media campaign by the North Carolina Chamber played a vital role in building support for more funding.

“Everyone wants to drive for free and use the network for free,” Cashion said. “But we had no idea just how poor support for increased funding was until we polled in 2014. That poll said that 71 percent of Republican voters would not support more money for the transportation network.”

After reviewing those dismal results, the North Carolina Chamber realized that educating the public would be a key component of a successful campaign.

“We asked ourselves what would happen if we began to talk about this issue in a different way,” Cashion said. “We decided to make it an economic and jobs issue. We created a new message and a new messenger.”

The North Carolina Chamber led a fundraising effort to secure more than $1 million to invest in a multimedia campaign called “NC Can’t Wait.”

constructionThe campaign paid off.

“To make a long story short, we were able to change the narrative around transportation policy in North Carolina. We made a big dent, but we still have a long way to go in order to get the level of service we want our transportation network to be,” Cashion said.

North Carolina lawmakers approved a 30 percent increase in fees across the board. They also backed down the 37-cent-per-gallon gas tax to 34 cents but put in place a new indexing formula to keep pace with growing needs and increased costs.

“We took the step back in the short run to provide political coverage,” Cashion said. “We knew we would be getting more funding on the front end by increasing fees. In the long run the indexing would provide more funding and more sustainability.”

***

In Georgia, highway workers are busy resurfacing roads, replacing bridges and performing critical maintenance tasks. In the coming years, Georgians will benefit from major improvements such as the widening of highways and interstates in heavily trafficked corridors.

It’s all thanks to a $12 billion, 10-year building plan announced after passage of Georgia’s House Bill 170, the Transportation Funding Act of 2015.

The Georgia Chamber of Commerce led the effort.

“Passing House Bill 170 was the result of years of effort by a broad group of partners who understood how critical transportation is to Georgia’s economy. There was not one part of it that was easy, and too many times it felt like we were taking two steps back for every one forward,” said Seth Millican, director of the Georgia Transportation Alliance, a division of the Georgia Chamber of Commerce.

One big step back for Georgia was the defeat of a transportation funding ballot initiative in 2012 despite an investment of $12 million. The initiative passed in nine of 12 regions of Atlanta, but one key region, metro Atlanta, defeated the measure by more than 165,000 votes.

After a cooling-off period, stakeholders took another run at it in 2014, this time with a different message. Using a data-based approach, transportation backers laid out the economic case for investment community by community.

The message began to sink in. Polling conducted shortly before the state’s 2015 legislative session proved that voters understood the need for new investment. More than 50 percent of those surveyed said the state was spending too little on roads and bridges, and nearly 60 percent said they were willing to pay more in gas tax if it was used on transportation improvements.

A bill was introduced in January 2015. It passed the Georgia General Assembly and was signed into law by Republican Gov. Nathan Deal that May.

“Today we are ensuring that Georgia’s economic engine will remain running for generations to come,” said Gov. Deal as he signed the bill into law. “I commend the courage of the General Assembly for tackling this issue head-on and prioritizing public safety and future growth over politics.”

The bill raised motor fuel tax and diesel tax and indexed both to inflation. It imposed a moderate fee for heavy trucks. The legislation also tacked on a $5 nightly fee for hotel stays, which proved to be the most controversial provision.

***

In both North Carolina and Georgia, overcoming the stigma of new taxes was an important part of the battle.

“Living in a hyper-red state, there’s just that expectation that on red-meat issues like taxes, people are going to get up in arms about it,” said Millican. “Rather than fighting actual opposition, we spent more time trying to keep legislators out of their own heads. They expected any day to be greeted at the Capitol steps by people with pitchforks and torches against the plan, but that never happened.”

In North Carolina, the legislation was more an asset than a liability.

“In the end, no one ran away from the issue in North Carolina,” said Cashion. “As a matter of fact, some folks even campaigned on it after it passed.”

But unlike Georgia and North Carolina, Missouri can’t rely on the legislature and governor to raise funding by themselves. Missouri’s Hancock Amendment, passed in 1980, limits the amounts of taxes or fees that can be raised by the legislature. The Missouri General Assembly can raise only about $93 million before it hits the Hancock threshold.  Anything more would have to go to a vote of the people.

While failed transportation ballot initiatives are still a recent memory for Missourians, Millican said there is a path to success.

“Given our experience here, I believe we have learned enough that we could successfully pass a referendum now in Georgia, and I believe Missouri could be successful too,” Millican said. “Keep in mind that you need more lead-in time for a public issue referendum than a legislative advocacy effort. So much of it would hinge upon effectively and strategically educating the public and setting the parameters around the issue before actually presenting them with the solution/question.”

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