The NC Chamber has a history of leading on infrastructure issues, and creating a modernized transportation funding structure continues to be top of mind for our team as we work to keep our residents and visitors safe, improve our quality of life, and meet the demands of a growing state. Our Government Affairs team has been encouraged by recent engagement of legislators and state leaders at the NC TEN Commission and N.C. Transportation Summit.
NC TEN Commission:
The NC TEN Commission, a group of stakeholders led by Senator Vickie Sawyer, met at the end of 2022 to vote on which transportation revenue items should be considered by legislators during the 2023 session. We are encouraged by the buy in that we are seeing in the NC TEN Commission from folks like N.C. Senate President Pro Tem Phil Berger.
The conversation centered around four areas of revenue changes: registration fees, user fees, sales taxes, and technology fees. Stakeholders broke into groups, discussed each of these buckets and then proposed action steps.
Specifically, legislators and stakeholders looked at proposals surrounding electric vehicle and hybrid vehicle fees, the access user fee idea we have championed, the highway use tax and net of trade exemption, and even ideas on how to capture the new economic activity happening via ride sharing services and delivery vehicles on our residential streets.
The NC Chamber is encouraged by the engagement of legislators on this issue and hope that the proposals talked about here make their way to legislative text.
N.C. Transportation Summit:
Transportation funding was also top of mind for transportation advocates, industry leaders, and state legislators at the recent N.C. Transportation Summit. Director of Government Affairs Mark Coggins and Senior Member Relations Manager Jake Sipe represented the NC Chamber team at the Summit and hosted an exhibit to talk to the more than 1,000 attendees about the value we place on continued investment in North Carolina’s transportation infrastructure. Our team was encouraged by the support and interest from conference attendees dropping by the NC Chamber’s booth.
One Summit conversation of particular interest to our team was the Mileage Based User Fee Concept discussion lead by Dr. Trish Hendren of Eastern Transportation Corridor Coalition, Jennifer Rash of PRR, and Ted Bristol or MBUF Alliance. At its creation, the gas tax was a true usage fee, but it is becoming an increasingly unfair and insufficient means for funding our roads.
Our auto fleet has made vast improvements in efficiency over the last couple decades, and the increasing market share of electric vehicles is not the only, or even primary, driver of the funding modernization discussion. Consumer choice reigns in the car market and how much a driver pays at the pump largely depends on the kind of car they buy. Some people can make a choice to pay for a more efficient vehicle, but many can’t afford anything except the older car they currently drive. A mileage based user fee would replace the gas tax by charging the driver a fee based on the number of miles traveled.
The NC Chamber and Destination 2030 coalition has and will continue to champion the Access User Fee concept as well as any other idea that creates real conversation on how to sustain the transportation system of the future without the gas tax. An access user fee would instead charge a flat and consistent user fee for all drivers regardless of the number of miles driven. Learn more about this concept here.
Of additional concern, panelists also noted the worrisome perception in North Carolina that there isn’t a problem with our road system or road funding. People generally think the road system is in good shape and that funding has either increased recently or stayed the same. This is a problem we have to solve for in messaging transportation funding modernization.
Also at the Summit, NC Chamber team members attended a legislative panel on the future of transportation funding lead by Sen. Woodard, Sen. McInnis, Rep. Brenden Jones, Rep. Shepard, and Treasurer Folwell. Treasurer Folwell complimented N.C. DOT leadership and their commitment to sound fiscal management over the past couple years, and there was considerable discussion about how DOT employees are not paid enough and that work must be done to make these jobs more attractive.
No specifics were mentioned by legislators on future transportation funding options, but all were open and receptive to ideas in this space. Senator McInnis suggested that it will take all of us to solve this issue and mentioned tolling as a future option in certain locations.
Chairman Jones spent time highlighting the sales tax dedication that the legislature passed with the support of our Destination 2030 coalition last year. This win puts significant funds in transportation infrastructure over the next decade.
The modernization process will be lengthy and potentially messy with most of the experimentation happening at the state level. However, that doesn’t mean we shouldn’t continue to push for bold action so we can define our own future.
The NC Chamber appreciates the leadership and boldness displayed by the public servants at the Summit and looks forward to working with them to solve this core issue at the legislature this year. We also thank our many partners for their involvement and NC Go! for their leadership in cohosting this year’s Summit.
The NC Chamber expects to see a few items on the agenda this year regarding Transportation Modernization:
- A renewed focus revenue raisers, not just revenue shifting from one area of the budget to another.
- A robust conversation around things like electric-vehicle fees, the Public-Private Partnership Cap Increase, increases in the Highway Use Tax, and per-ride fees for ride-sharing services.
- The NC Chamber will continue to champion the Access User Fee concept and any other idea that creates real conversation on how to sustain the transportation system of the future without the gas tax.