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Texas Senate
February 25, 2015
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The Texas Senate
Transportation Chair Senator Robert Nichols passed his plan to dedicate part of motor vehicle sales tax revenue to transportation funding out of committee Wednesday.

(AUSTIN) — The Texas Department of Transportation could see billions more under a plan approved by the Senate Transportation Committee on Wednesday. The new measure would take a portion of various motor vehicle related taxes and dedicate that money to road and bridge construction and maintenance. Bill author and committee Chair Senator Robert Nichols said it was vital that road planners have a dedicated stream of funding to rely on year to year. "TxDOT has to know, six, eight, ten years out what they're going to have or they cannot even begin design work", said Nichols. "It's extremely important."

Transportation has been an issue of major focus this session. Both chambers have introduced budgets that end diversions from the state highway fund and spend all of that money on transportation issues. In the past, budget writers have used that money to plug holes in other parts of the budget. Governor Greg Abbott has also emphasized transportation spending in the state budget and designated related legislation as an emergency issue, allowing such bills to bypass the constitutional prohibition on passing bills in the first 60 days of the session.

The two bills passed by the committee Wednesday work together to dedicate a portion of the motor vehicle sales tax and other taxes associated with vehicle use, but not the gas tax, to TxDOT. The first $2.5 billion of this money still would go into general revenue, but funds raised above that would go to transportation. If those taxes earn more than $5 billion in a year, then the funds raised above that amount will be split evenly between general revenue and TxDOT. Because the bill requires a constitutional amendment, voters will have to approve the measure before it can become law. An earlier version of the bill would've put that issue on the November 2015 ballot, but Nichols changed the bill to put that election in 2016. Voters turn out in greater numbers during presidential election years, said Nichols, and he wants to make sure that the maximum number of Texans can weigh in on this issue in the voting booth.

The bills raised a discussion about the pros and cons of dedicated revenue. In last session's budget, more than 80 percent of all funds were appropriated based on constitutional requirements or statutory formula, leaving lawmakers with discretion to direct less than a fifth of revenue into state services. Some committee members raised concerns about how decreasing the amount of discretionary spending could tie the hands of budget writers. "Once we commit those funds, the Legislature loses the ability to address [other issues], " said Horseshoe Bay Senator Troy Fraser. "I have a real concern about us doing something that obligates a future legislature." Nichols argued that by designating the first $2.5 billion to general revenue that the lion's share of motor vehicle sales tax revenue would flow into general revenue even in down economic years. "I've tried to structure it in a way that does protect [general revenue] but allows growth in the long term," he said.

Because transportation funding is on the Governor's emergency issues list, the Senate can take up the bill immediately. Lt. Governor Dan Patrick told reporters at a Tuesday press conference that he plans to bring the bills up for a vote next week. "It is very important that that bill passes," he said.

The Senate will reconvene Monday, March 2 at 2 p.m.

Session video and all other Senate webcast recordings can be accessed from the Senate website's Audio/Video Archive.