On October 7, 2017, you will be asked to vote “for the amendment” or “against the amendment”; the language on the ballot will be as follows: “To provide for the improvement and construction of safe roads in the state by issuance of bonds not to exceed $1.6 billion in the aggregate to be paid for from the State Road Fund and the collection of annual state taxes as provided by the Legislature by general law.”
In everyday language, “the issuance of bonds” means that West Virginia will be borrowing $1.6 billion, and paying it back over a 25 year time period. Taxpayers will repay the loan with money collected through state fuel taxes, DMV fees, and the sales tax paid on new vehicle purchases. I have heard estimates as high as $4.5 billion will be paid back for the privilege of borrowing $1.6 billion because we will be paying fees and interest on the bond amount.
A question that I have heard many times is: “Will this mean that our taxes will be increased”? The Governor, and others, have been saying no we are already collecting the tax, but I think that a more honest answer would be – maybe not. In the long term, more funding for roads will be necessary; short term, if the legislature complies strictly with the resolution that put the bond on the ballot (SJR 6), then it appears to me that taxes will be increased. This is directly from Senate Joint Resolution 6, Enrolled Version-Final Version, section (c) it says, “When a bond issue as aforesaid is authorized, the Legislature shall at the same time provide for the collection of an annual state tax which shall be in a sufficient amount to pay the interest on such bonds and the principal thereof as such may accrue within and not exceeding twenty-five years. Such taxes shall be levied in any year only to the extent that the moneys in the state road fund irrevocably set aside and appropriated for and applied to the payment of the interest on and the principal of said bonds becoming due and payable in such year are insufficient therefor. Any interest that accrues on the issued bonds prior to payment shall only be used for the purposes of the bonds.”
If the bond passes, the $1.6 billion will be issued and sold over a four year period; $800 million in 2017, $400 million in 2018, $200 million in 2019, and $200 million in 2020. There are hundreds of projects across West Virginia which are listed and posted by the Department of Highways. The bond dollars will be joined with federal funds to complete projects totaling more than the $1.6 billion bond. An amount expected to be between $130 million and $140 million per year will be dedicated to pay the interest and principal for the next 25 years. Roads will be constructed at an accelerated rate, requiring a large number of out of state companies and workers; and the emphasis will be on building new roads. All of this construction is expected to produce a short term boost to the state economy.
If the bond fails, the Department of Highways will apply the same $130 million to $140 million already being collected to pay for road work on a pay as you go basis. It can still be matched with federal money in different ways to increase the total amount. Road work will be completed at a slower pace, allowing for more local companies and workers to do the jobs. The short term boost to the economy would be smaller, but the money that would have been applied to fees and interest can be applied to more projects.
For general information, West Virginia has been collecting and spending approximately $1.2 billion per year on road work.
This decision is important to the future of West Virginia and it belongs to the people who vote. I have been troubled by some of the questionable information in all forms of media. A statement has been made that if you don’t pass the bond, the tax money we now collect for roads will be “wasted” on other things. The fact is that road repair and construction in West Virginia is paid for with tax revenue collected from fuel tax, DMV fees, and taxes collected when you buy a new car. That “road money” cannot be diverted to other purposes. It has to be used for road work. The exception to that funding model is the toll roads, and we are about to get more of those! That is a subject for another article.
Finally, there was an instance, reported by WV Metro News on September 13th, where the Governor implored County Clerks, and other election workers, to advocate for passage of the bond with at least one County Clerk on the video agreeing to help promote it. This is not appropriate because election workers are supposed to be neutral as they assist people in the voting process. An ethics complaint has been filed against the Governor, with no ruling to date.
Special Election Day is Saturday October 7 early voting begins on September 22 and ends on October 4. To register to vote, or change party affiliation, the deadline is September 18, and there are provisions for absentee voting.
If you have further questions, I am happy to do all I can to answer them. You can call me at home at 304 675-3984, or email at email@example.com
It is an honor to serve you,
Jim Butler (R-Gallipolis Ferry) represents the 14th District in the House of Delegates.