Horizon, Host: Ted Simons

July 28, 2008


Host: Ted Simons

Fueling Trouble: T.I.M.E. Initiative


  • We begin a four-part series on the rising cost of fuel and transportation issues in the state. Tonight we discuss the Transportation and Infrastructure Moving Arizona's Economy (T.I.M.E.) initiative. Proponent Martin Schultz, government affairs vice president for Pinnacle West Capital Corporation, debates opponent Steve Voeller of the Arizona Free Enterprise Club.
Guests:
  • Marty Shultz - Treasurer, Time Initiative Campaign
  • Steve Voeller - Chairman, Transportation Vision 21
Category: Business/Economy   |   Keywords: energy,

View Transcript
>>Ted Simons:
We begin a new four-part series this evening, "Fueling Trouble," that will look at the impact of the rising cost of fuel and transportation issues in the state. With its far-flung suburbs and somewhat limited mass transit, Phoenix is mostly a car-driven metropolitan area. This fall voters will decide whether to fund more freeways, trains, and buses. We'll hear a debate on that time initiative in a few minutes. Time is an acronym for transportation and infrastructure moving Arizona's economy. First, though, a milestone was reached earlier this month with the completion of the 202 between Power Road and University Drive. That was part of proposition 300, approved by voters more than 20 years ago.

>>Larry Lemmons:
Despite the price of gas, drivers in the East Valley have something to cheer about. The Red Mountain Freeway is now connected between Power Road and University Drive in East Mesa.

>>Doug Nintzel:
It's just such a huge milestone to complete the regional freeway system. So beyond opening the Loop 101, the Red Mountain Freeway, and having that finished, it really means we've completed 137 miles of regional freeways, taking us back to the mid-1980s. So much has been done over the course of the past two decades, and in some ways folks can take it for granted, especially those who haven't even been here that long. But it's been quite the program to put these freeways all together, put them in place, and now allow folks to get from point a to point b, from one end of the Valley to the other. And to be able to do it in a safe and what we hope is a reasonably fast amount of time.

>>Larry Lemmons:
This particular stretch of the freeway, almost five miles, cost almost $200 million. It was the most complicated part of the road because flood control barriers had to be built and a lot of dirt had to be moved. All in all, the freeway ended up costing nearly $2.5 billion. It was the last link of freeway funded by Proposition 300 that ear-marked a half-cent sales tax toward the project in 1985.

>>Doug Nintzel:
You know there was a lot of vision that was needed. It was a struggle to get the Valley to decide, we do need the additional freeways. We've had the backbone freeways like I-10 and I-17. But to move forward with a freeway program took a long time and some vision. Voters said yes in 1985, and from there we were off and rolling to where, yes, there were struggles along the way, but now we can look back and say, 137 miles of regional freeways, including all of the Loop 101, the Loop 202 through the East Valley, that makes a huge difference.

>>Larry Lemmons:
The Arizona Department of Transportation has begun work on the projects for proposition 400. That was approved by voters in 2004. Regional projects are funded through 2025 by a Maricopa County half-cent sales tax.

>>Doug Nintzel:
We're already underway with Proposition 400. We are building projects like the I-17 widening in the North Valley, the I-10 widening in the West Valley, projects that are going to enhance the existing freeways, while also doing some of the study work right now to look ahead to corridors for the future, whether it's a parallel freeway to I-10 in the West Valley, and also the Williams Gateway Freeway in the Southeast Valley. And also looking ahead to actually building Loop 303 as a full access-controlled freeway, where you have the three lanes in each direction. Again, we're looking ahead to trying to manage within the growth that's still going to occur here in the Valley.

>>Ted Simons:

The Time Initiative will go before voters this November. It'll increase the state sales tax one cent to 6.6\%. $42 billion will be collected over 30 years to pay for freeways, mass transit, and conservation projects. Earlier this month on "Horizon" Governor Janet Napolitano expressed her support for the Time Initiative.

>>Ted Simmons:
I've asked you this before, but again, how do you convince people in these troubled times that this is the time for that increase?

>>Janet Napolitano:
Well, you know, what you say first of all, the tax part doesn't even begin until 2010, it's suspended. But the initiative itself allows us to build and buildig creates jobs. We build railways and highways and bridges and mass transit and rail from southern Arizona to northern Arizona. What a great way for all of us collectively to say we are continuing to invest in the state of Arizona. If that doesn't pass, we will run out of transportation money within the next 18 to 24 months. We will only be able to repair what we have. And talk about something that will cost us jobs and cost us economic growth that is not a future we want.

>>Ted Simons:
The Sierra Club is not on board with the Time Initiative. Here's what Sandy Bahr, director of the Grand Canyon Chapter, had to say.

>>Sandy Bahr:
Our biggest concern about the Time Initiative is that it really takes us down the same road as far as transportation goes. Most of the funding will go toward roads, 55\% of this one-cent sales tax goes to roads. A limited amount of money to transit, 18\%. And a very small amount also to wildlife. We are so far behind when it comes to developing a mass transit system, including with rail and an appropriate number of buses. So they go in a frequency that makes it usable for people at all the times of the year. We need to change the direction of transportation in this state. This is more of the same old, same old. With rising gas prices, although I know there's a little dip, we're not going to see cheap gasoline. People need alternatives. The problem right now is they don't have real alternatives. Roads, obviously we need roads and we need them to be maintained. And a measure that focused on maintaining what we have, and then heavily investing in transit, as well as providing for the wildlife connections and corridors, that's something we could support. But the Time Initiative didn't give us that. It goes through 30 years. It's a whole cent that's a lot of sales tax and a long time for it to go. We think the plan is an old school plan, and we need to be looking at the future.

>>Ted Simons:
Joining me now to talk about the pros of the initiative, the Treasurer of the Time Initiative Campaign, and also the Chairman of Transportation Vision 21, Marty Shultz. Opposing the initiative, Steve Voeller, the president of the Arizona Free Enterprise Club. Thank You both for joining us on "Horizon."

>>Marty Shultz:
Glad to be here.

>>Steve Voeller:
Glad to be here.

>>Ted Simons:
Alright Marty, a penny increase on sales, a 17.8\% increase, call it what you will-why this, why now?

>>Marty Shultz:
Why now? Because as the governor indicated our analysis showed within 18 months we will be in a crisis mode, as far as the ability to continue construct transportation facilities. That's freeways, highways, transit. Now is the time to make the decision as to how to invest. We went to 28 separate approaches to funding the transportation system, and the analysis suggested that the appropriate funds would be the penny adjustment on the sales tax.

>>Ted Simons:
Okay. Why is that a bad idea?

>>Steve Voeller:
Well, the notion that we need to fund transportation at $42 billion over 30 years, we definitely need more transportation. But we have to remember there's been a billion two every year in the cycle. This initiative could be re-titled the leap of faith initiative. This requires a 17.8\% rate increase on the state sales tax for 30 years. But it only covers 55\% of highways and freeways where most people want to take their car in Arizona and Phoenix. A lot of that money is spent on things like not only mass transit, but nature conservancy groups, and other things that don't move people. Bike paths, pedestrian walkways, open space. It's more than just a transportation issue.

>>Ted Simons:
If there was a tax of this length and cost, and all of it went to freeways, every single penny, would you be opposed?

>> Steve Voeller:
I don't know it's not the question in front of us. I haven't really looked at that question. But this is a tax increase in a very, very shaky economic time. The state sales tax collections and income tax collections have been off. A new tax increase, a billion four a year, is going to put the brakes on the economy.

>>Ted Simons:
Marty, can a weak economy handle this burden?

>>Marty Shultz:
We believe so. First of all, the effective date of the tax is 2010. That was designed because of the estimate of how the economy is going to come back and when it's going to come back. Secondly, with regard to Steve's comments about transportation, I have been heavily involved with transportation so I will tell you this. People in Arizona definitely want and expect to improve the highways and freeways. And in your pieces you've seen a lot of discussion about the new roads that have happened. This is statewide. This is covering the entire state of Arizona. People also expect an effective transit system, an effective bus system. Frankly, between Phoenix and Tucson we have growth that is now going to need a full-scale transportation system. So this is a multi-year, multi-decade system. You asked Steve the question about would he support just freeways alone. Well, whether he would or wouldn't, freeways alone are a bad idea. With $4 gas and people rushing to buses - and I believe people will rush to the light rail -- that really would be a big mistake. I know it's hard for some to believe, but this state has 6.5 billion now, and will have in the neighborhood of 12 million by 2040. Are we going to plan for the future and work our way through this congestion, or just say no, as sometimes my friends on the right do, and leave it to chance? I haven't heard anything about Steve's plan. Maybe you can ask him about his plan.

>>Ted Simons:
That's exactly what I do want to ask. You said something needs to be done. What? What works?

>>Steve Voeller:
Well, we definitely need more transportation infrastructure. There is a five-year rolling plan that raises about a billion two a year. This is a billion four, that's a billion two. We need to make sure the money is spent wisely, not on things that don't move people. I want to get something that Marty did raise which was people are demanding light rail? How do we know? There was one election that was passed four years ago. And during that election the proponents said we're not going to expand light rail until we have a ridership audit. Is it cost-effective? Is it moving people? And here we are only four years later without one person riding light rail, getting ready to tax, to expand it.

>>Marty Shultz:
I'm really sorry that Steve is combining two things. He was describing what's going on in Maricopa County. This is a statewide initiative. This has to do with Maricopa County, but also had to do with the balance of the state. Because Arizona is now urbanizing. It's not like the good old days where cities were separated. But Arizona is actually urbanizing. The population growth projections, even in a soft economy, are still rather impressive, making Arizona the second-fastest growing state in the country, even with the downturn in the economy. For Steve and his colleagues to say that somehow we're going to do this all with freeways, when we have density in this urban area of 10,000 people per square mile? Let's grow up, the state's growing up.

>>Steve Voeller:
Let's forget the rail and mass transit component, let's go to the fact we're raising, they picked a penny on the dollar 17.8\% rate increase on the sales tax to go to things like open space, bike paths, things that don't move people. Enhancements, beautification, campsites. This is not just focused on transportation. It could be done a lot more effectively.

>>Ted Simons:
Why were those things included A. and B. Why whatever happened to the concept of impact fees on developers? We know why it's gone, in terms of a deal the governor made; we got the machinations out of the way. But does that make sense?

>>Marty Shultz:
I really appreciate Steve delineating each of these important features of this initiative. Growth in Arizona is not just building new freeways and putting the same old subdivisions. Growth strategy and growth policy has to do with open space, how we treat the scenic vistas. And by the way, bikeable and walkable communities, and frankly quality of life, woven into a complete transportation system that is multimodal is where we are going, whether Steve and his colleagues agree to that or not. I'm really encouraged that he knows the details. When he really understands it, he's going to understand how important it is to support it.

>>Ted Simons:
Make us understand why impact fees are not in there.

>>Marty Shultz:
Impact fees are already part of the funding of transportation. They are imposed by cities.

>>Ted Simons:
I asked you the question whether or not you would support this if it were freeways and only freeways because it leads to my next question--Do you support any tax for transportation?

>>Steve Voeller:
Sure, we already pay taxes for transportation.

>>Ted Simons:
I'm talking about your group. Would you support a further increase in taxes, a new tax, anything along those lines for transportation?

>>Steve Voeller:
We need to look at taxes as it relates to the overall economy too. In 2006 the economy was chugging along and the state revenues were setting records. We're now in a recession, a penny tax increase, and a billion four a year, 17.8\% on the rate; it's going to be very harmful to the economy. Let me also say, that is a 30-year tax, voter protected. You can't make any changes in the different pots of money that are set aside, because of the voter protection act we have here. If you want to make a change from light rail or to roads or some other mode of transportation, you can't do it.

>> Steve needs to look closely at the details. In fact, while the major pots of money do not change, the local decisions by the local city governments, local county governments, by the state board of transportation are based on, A. the critical needs projects which will be built; and then additional projects going out into the third decade, if you will. Looking forward, as opposed to saying no, is really what this is all about. And it is a good solid growth policy.

>>Steve Voeller:
I do give them credit for the public partnership with toll roads. That's a very good way to look at moving people.

>>Ted Simons:
And that's a good way to stop this debate. My goodness, agreeing. I don't know what to do. Thank you both for joining us.

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