/5 takeaways from Senate infrastructure proposal

5 takeaways from Senate infrastructure proposal

After three hours of debate, the Senate voted 36-14 in favor of passing Tuesday’s bill. The bill now moves to the House where it will face a later deadline. Mississippi Today spoke to the bill’s detractors and authors to gather these key takeaways. * Takeaway 1 – In order to make the largest pot of money in the proposed proposal — $600 million over five year for the Strategic Infrastructure Investment Fund — legislator leaders are contradicting the previously stated commitment to increasing the state’s reserve funds. The “98% rule” law requires that the Legislature spend no more than 98 percent of its collected revenues in a fiscal year. Imagine the state expecting to receive $100 in this fiscal year. The Legislature would spend $98, with $2 remaining as a reserve for any revenue shortfalls. The $2 extra is divided evenly into two reserve funds if revenues exceed expectations at the end of each fiscal year. Lt. Gov. said that the goal was to restore the 2 percent reserve so that we only spend 98% of revenues. Tate Reeves stated this in November at the first Fiscal Year 2019 Budget Meeting. “We also want and will continue to build our state’s financial reserves,” Reeves’ proposal for infrastructure would achieve the opposite of these two goals. Reeves’ new infrastructure proposal would shift the entire 2 percent to the fund. This would give the state less flexibility to meet its spending obligations, and take away cash flow to the state’s two largest reserve funds. The Legislature has suspended the rule of 98 percent to spend 100 percent of revenue collected in five of the eight fiscal years. In the last three fiscal years, seven times leaders have cut budgets in the middle of the year and raided reserves funds to balance the budget. * Takeaway 2 – Three Senate leaders – Sen. Joey Fillingane, and Senator Willie Simmons – gave the Senate less than 24 hours to study the proposal before asking them to vote. * Takeaway 2: Three Senate leaders – Sen. Joey Fillingane and Sen. Willie Simmons gave the Senate less time to review the proposal before asking them for their votes. Leaders waited for President Donald Trump’s federal infrastructure proposal to be revealed, which he did on Monday. This was the reason why the bill wasn’t considered. Senate leaders claimed that waiting on the federal proposal allowed them to position their proposal in order to receive as much federal matching funds as possible. Fillingane stated Tuesday that he wished everyone had the time to read it. “But we heard so many people say, ‘Please don’t do anything until you hear from the federal programme’ that’s why we waited,” said Fillingane. Several Senate Democrats condemned the bypassing the normal legislative process. Senator David Blount (D-Jackson) stated that this is not how the Legislature should work. We need more than 24 hours. This is how we do business. It frustrates me. This is how we’re going on doing business until the members have had enough.” Sen. David Parker (R-Olive Branch) did not know that a key part of his proposal, which he had drafted, would increase the diversion tax to cities, had been amended by the Finance committee meeting Monday afternoon. Reeves had just announced the plan minutes earlier. The proposal was not presented to the Mississippi Department of Transportation or House of Representatives leaders. Philip Gunn spokeswoman said that the House watched Reeves’ Facebook Live announcement. * Takeaway 3 – The proposal would remove much of the Mississippi Department of Transportation’s spending authority and project flexibility. The majority of Mississippi Department of Transportation spending is currently controlled by the elected three-member state Transportation Commission. The proposal would see the Transportation Commission transfer the majority of the authority to spend (for the new Strategic Infrastructure Investment Fund), from the governor. Reeves is the man behind the current Senate proposal. He has raised over $5 million to support a possible gubernatorial campaign in 2019. Melinda McGrath (executive director of MDOT) stated that it just seems like they are trying to take away the legislative power from the commission without asking the people what their thoughts. These accusations were dismissed by key Senate committee chairmen and leaders. Fillingane stated that there would not be any restrictions on the federal and special funds MDOT receives. “We aren’t condemning DOT,” stated Sen. Willie Simmons (D-Cleveland), who chairs the Transportation committee and is co-author of this bill. “We have been working with them for six years.” * Takeaway 4. Private sector leaders will decide how taxpayer money is spent. Many of these leaders are individuals and organizations that have donated millions of dollars to campaigns of legislators and state officials. The new proposal’s second largest amount of money – $200 million for the Emergency Bridge Repair Fund, which will be in place next fiscal year – would go to immediate infrastructure needs such as bridge or road repair or replacement. A top state agency official that funds county bridge repairs would be the State Aid Road Engineer. He would then provide a list with the most urgent projects to a newly formed board which would make recommendations for the governor. Representatives from the Mississippi Economic Council and Mississippi Manufacturing Association, Mississippi Poultry Association and Farm Bureau would make up the new board. They will also represent some of the most powerful private-owned special interests groups in the state, including the Mississippi Association of Supervisors, Mississippi Municipal League, Mississippi Trucking Association, Mississippi Association of Supervisors, and Mississippi Poultry Association. These leaders from the private sector would be able to influence the governor, whose campaigns they may have funded, over how taxpayer money is spent and which infrastructure projects are funded. This fund would be funded from the current MDOT funding levels, which will drop $25 million per year over the next five years. The state’s current fiscal year cash balance (currently $50 million), would be transferred to this fund. However, that number can fluctuate depending upon revenue collection. In addition, the fund would also receive $15 million annually in auto tag fee divertions. * Takeaway 5 – The proposal contains a tax hike, even though Reeves or other Senate leaders claim that it does not. Electric car drivers who use no gasoline would be charged $150 per year to renew their tags. Hybrid vehicle drivers would pay $75 per year. This is called an “annual privilege tax” in the bill’s language. It would be the only money generated from the whole proposal, which is claimed to provide $1 billion for infrastructure. As electric and hybrid vehicles have grown in popularity, other states have imposed similar taxes. To charge Mississippi residents who use its roads and bridges, the state has a gasoline tax. This new tax was used in other states to recover infrastructure maintenance costs from people whose vehicles use less gasoline than the average car.