x-sender: governor.haley@sc.lmhostediq.com x-receiver: governor.haley@sc.lmhostediq.com Received: from mail pickup service by IQ12 with Microsoft SMTPSVC; Sat, 7 Mar 2015 13:28:13 -0500 thread-index: AdBZBHh0HK5gnLA1Sym4oFo+ZkRsYA== Thread-Topic: Eliminate the State Transportation Infrastructure Bank (STIB) To Obtain Road Maintenance Funds From: To: Subject: Eliminate the State Transportation Infrastructure Bank (STIB) To Obtain Road Maintenance Funds Date: Sat, 7 Mar 2015 13:28:12 -0500 Message-ID: MIME-Version: 1.0 Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: 7bit X-Mailer: Microsoft CDO for Windows 2000 Content-Class: urn:content-classes:message Importance: normal Priority: normal X-MimeOLE: Produced By Microsoft MimeOLE V6.1.7601.17609 X-OriginalArrivalTime: 07 Mar 2015 18:28:13.0175 (UTC) FILETIME=[78989070:01D05904] CUSTOM Mr. Keith Cooper Cooper 1673 Onyx Ridge Fort Mill SC 29708 cmbengrg@comporium.net (803) 396-5619 TRAN Eliminate the State Transportation Infrastructure Bank (STIB) To Obtain Road Maintenance Funds Dear Governor Haley, As you probably realize most of the road money is controlled by the State Transportation Infrastructure Bank (STIB). Needed SC road maintenance is not being done mainly because of the STIB. Raising taxes to provide more road maintenance funds is not the answer because of the STIB. The STIB should be eliminated, so that more funding is provided for road maintenance, for the following reasons: 1. The STIB only finances expansionary projects, never maintenance. Since its inception, the STIB has only contributed funding to projects that either create entirely new roads or expand existing ones (by adding miles or widening lanes, etc.). Every dollar that goes to the STIB is a dollar that could have gone to maintenance instead of funding expansions. Remember, South Carolina's is the 4th largest state highway system in the country). 2. The STIB Expansions put more strain on existing maintenance funding. There are three primary sources of funding for roads in South Carolina: state gas tax revenues, federal funds, and STIB debt financing. Of these three, state gas tax revenues are the smallest source; they are also the only source free to be devoted to routine road maintenance. Every expansion of the state road system (the kind of projects routinely funded by the STIB) creates more lane miles that must be maintained with the small pool of funds free to be used for maintenance. 3. The STIB Finances road construction through the issuance of bonds - i.e.debt. The agency generates the large amount of funds it uses to finance road expansionary projects by issuing bonds backed by the dollars appropriated to them by the legislature. Once the STIB board has generated funds via bonding, it issues loans to counties for various projects the board chooses to finance. All of these bonds must be paid back with interest. Again: payments on these bonds are dollars that could have gone towards needed road maintenance and repair. STIB bonds are the largest category of South Carolina's bond debt, with total liabilities at over $2 billion dollars in fiscal year 2014. 4. The STIB favors a few counties. As of January 2013, 35 counties had received no funding from the STIB since its creation. Up to the same point, six counties had received 95 percent of STIB disbursements, and one county (Charleston) had received 33 percent of all STIB disbursements. The large majority of counties are losing out on maintenance dollars so that a handful of counties can build largely unnecessary new roads. 5. The STIB is effectively controlled by two legislators. STIB policy is set by a seven member board comprised of two members appointed by the governor, two members appointed by the Senate President Pro Tem, two members appointed by the House Speaker, and the chairman of the DOT Commission (who is most most likely elected by legislators). With control of four of the seven members of the board, the House Speaker and Senate President Pro Tem - two politicians not elected statewide - have de facto control over one of the most powerful infrastructure authorities in the state. 6. The STIB Board is free to finance whatever projects it chooses. Under existing law, the STIB is free to finance any "eligible projects." A quick perusal of the state law code, however, reveals a definition of eligible projects so loose as to be almost meaningless. The few STIB financing requirements that do exist, such as the requirement that a project's costs must exceed $100 million to qualify for STIB financing, are ignored in practice. No real prioritization requirements and little accountability make the STIB the transportation slush fund of two powerful legislators. Before the legislature raises taxes, creates new taxes or fees, and commits the state to any further debt, the STIB should be eliminated and the Department of Transportation reformed to create a more accountable system. Yours sincerely, Keith Cooper 1673 Onyx Ridge Fort Mill SC 29708 (803) 396-5619