The House Transportation Committee has voted unanimously, with no discussion, in favor of HB 309, Transportation Chairman Joe Palmer’s bill to use tens of millions from the Budget Stabilization Fund, the state’s main rainy-day account, to create an endowment for transportation. When Palmer presented the bill to the committee, he said, “It’s investing … money properly. ... We have nearly half a billion dollars sitting in an account that’s earning no interest.”
Actually, the Budget Stabilization Fund is currently invested like other state idle funds; it earned $9 million in interest last year. Currently, by law, its earnings are transferred to the Permanent Building Fund, which pays for state building maintenance, alteration, repair and construction.
The bill would direct the state to take $272 million of the $373 million currently in the Budget Stabilization Fund, and move that into a new fund that would be invested the same way as the state’s Millennium Fund, an endowment that earns higher earnings than regular state investments. It would then direct 5% of the new fund’s market value, every year, into the Strategic Initiative Fund to pay for road construction projects. Also, in the first year, $38.2 million would be shifted directly out of the new endowment fund into the Strategic Initiative Fund.
“It works, and I think it’s a really good bill,” said Palmer, who noted that last year, the House unanimously passed an earlier version of the same bill. A motion was made to send the bill to the full House with a recommendation that it “do pass,” and it carried unanimously.
The committee also voted unanimously to introduce a new bill from Palmer to double the amount of state general-fund money that's shifted to transportation each year, from the current $18 million to $36 million. "We need more money in the transportation funding system," Palmer said. That vote clears the way for a full hearing on the proposal.