Despite animosity between legislature and MoDOT, I-70 funding moves forward

April 21, 2023


missouri news network

JEFFERSON CITY — Republican legislators have unblinkingly voiced displeasure with the Missouri Department of Transportation during this year’s legislative session.

With billions of dollars of surplus funds in the state treasury, lawmakers are considering how — or whether — to use a billion of those dollars to expand Interstate 70 — a priority in Gov. Mike Parson’s budget proposal.

But will the apparent bad blood between Republican lawmakers and the Missouri Department of Transportation undermine that effort?

Earlier this month, Senate President Pro Tem Caleb Rowden, R-Columbia, said frustrations with MoDOT shouldn’t be what stops the expansion of the state’s main east-west corridor.

“It’s not worth derailing a chance to rebuild I-70 and do some of these things that we have an opportunity to do,” Rowden said.

Just two months before, the tone of Rowden’s comments were less diplomatic.

“I would hate for an uncommunicative and bloated bureaucracy to be the thing that stands in the way of the people of Missouri seeing significant successes relative to I-70 and I-44 … If we don’t do it, it’s because we don’t trust MoDOT,” he said at the Feb. 1 confirmation hearing of two new transportation commissioners.

On the other side of the Capitol, Rep. Don Mayhew, R-Crocker, introduced HJR 37, intended to subject MoDOT’s state road fund to Missouri’s annual budget process.

Mayhew said his bill is a response to a 2021 lawsuit filed by MoDOT over employee pay raises. A comparable lawsuit filed by the Missouri Department of Conservation in August 2020 and a contentious gas tax increase in 2021 also provided kindling for heated discussions that have peppered this year’s legislative session.

Here’s a look at what’s at play in the effort to use a pandemic-era federal windfall to realize the state’s decades-stagnant plan to turn the east-west interstate highway into a veritable three-to-four-lane thoroughfare in each direction.

The state road fund

The state road fund is one of multiple funds that MoDOT uses to pay for transportation-related expenses. For example, the state transportation fund is used for non-highway transportation expenses and the state road bond fund is used to repay bonds issued by MoDOT to fund highway construction.

The state road fund was established in the early 1900s, the time of the Model T Ford, to build and maintain Missouri’s state highway system. Its existence and how it works today are defined in Article IV, Section 30(b) of the Missouri Constitution.

In essence, it establishes a pool of funds MoDOT can use to implement road construction projects, which can take years to plan, design and construct.

The constitution sets parameters on what money in the fund can be used for: to maintain, improve and widen the state highway system, reimburse cities and counties for state road construction, and, notably, “to employ such personnel as necessary” for these purposes.

The constitution also sets out where money for the fund comes from: vehicle registration and license fees, vehicle sales tax, the gas tax and federal funding.

A key feature of the state road fund is that money funneled into it from these revenue sources is not subject to the legislature’s yearly budget process – a complex, inherently political, months-long negotiation driven by the party that controls the legislature. Instead, according to the state constitution, the money “stand(s) appropriated without legislative action to be used and expended by the highways and transportation commission.”

Those words mean that the six-member Missouri Highways and Transportation Commission can use money in the state road fund without legislature approval.

This line in the constitution and its interpretation are the backdrop of an ongoing fight between Republican legislators and MoDOT officials that began in budget meetings and ultimately landed in the courts.

MoDOT Lawsuit – December 2021

Every year, MoDOT submits a formal operating budget request that must be approved by the legislature and governor.

For years, MoDOT has used the annual budget process to request money for employee pay raises to combat increasing turnover. But the legislature has either rejected MoDOT’s requests for pay increases or approved less than the amount requested.

In October 2021 the Transportation Commission decided to implement pay increases using money from the state road fund, and asked the commissioner of administration to confirm that he would certify payments for the pay increases. By November, MoDOT had not received a response.

In December, MoDOT sued the commissioner of administration to settle the question: Does MoDOT have constitutional authority to use the state road fund for employee pay raises?

Circuit Judge Cotton Walker heard oral arguments over a year ago, in February 2022, but has not issued a decision.

Conservation Department lawsuit – August 2020

An August 2020 lawsuit brought by the Missouri Department of Conservation against the commissioner of administration in some ways reflects the stance MoDOT took in its lawsuit.

The Missouri Constitution creates a conservation sales tax that generates revenue to be used by the conservation department for forestry and wildlife management, “including the purchase or other acquisition of property for said purposes.” Tax revenue goes into the conservation commission fund.

During annual budget negotiations in 2020, the legislature didn’t approve funding for a particular conservation department property purchase. Nonetheless, the conservation department asked the commissioner of administration to certify payment for the property. The commissioner of administration refused.

Citing the constitution, the conservation department sued the commissioner, asking the courts to rule that the conservation department has constitutional authority to use the conservation commission fund for land purchases.

Walker ruled for the conservation department and ordered the commissioner of administration to certify payment, but the decision was appealed to the Missouri Supreme Court, which has not issued its decision.

House Joint Resolution 37 – January 2023

Fast forward to this year’s legislative session.

Mayhew isn’t waiting for the courts. He’s sponsoring a resolution to remove the phrase “stands appropriated without legislative action” from the state road fund provisions of the constitution. If approved by voters, that would nullify the question of MoDOT’s constitutional authority to spend state road fund money on pay raises without legislative approval.

“I think that they should have to submit to the legislature for appropriation authority, just like every other department has to,” Mayhew told the Missourian.

Mayhew is a licensed professional engineer and land surveyor. He’s also a former MoDOT engineer, and said he has considerable experience with MoDOT’s planning, design and bidding processes and experience with bridge and highway design and construction projects. He is chair of the House Transportation Accountability Committee.

When the resolution came up for debate in the House, Democrats argued against Mayhew’s position.

“For the five years I’ve sat on budget, MoDOT has always asked for a pay raise for their employees,” said Rep. Deb Lavender, D-Manchester. “They’re suing because they want to be able to have the ability to use their money to give their people raises. It just feels like a lot of people in this building have taken that personally.”

Lavender said the refusal to approve pay raises didn’t make sense financially. “It costs (MoDOT) $50 million to look for, find, train employees on a yearly basis – $50 million. The raise they’ve asked for their employees is $15 million.”

Rep. Michael Burton, D-Lakeshire, referenced the idea that the state road fund is set up to ensure MoDOT can count on funds for long-term infrastructure projects.

“You know that MoDOT has a difficult time with long-term budgeting for our roads,” Burton said to Mayhew during debate.

In an interview, Mayhew called the idea that the legislature is incapable of appropriating funds annually for multi-year construction projects “propaganda.”

Ultimately the resolution passed the House on a party-line vote and awaits Senate consideration.

“101 votes means that we’ve got a pretty good consensus that folks feel like MoDOT needs some oversight and accountability,” Mayhew said.

Gas Tax Increase – May 2021

The reason Mayhew wants to strip MoDOT’s spending authority is connected to a fight over the timing of a 2021 gas tax increase and MoDOT’s lawsuit over pay raises.

“We passed a gas tax ... and then (MoDOT) promptly gave everyone raises when that wasn’t the selling point,” Mayhew said during floor debate. The selling point for the gas tax increase was road construction projects. “Some members of the body thought that that was a bait and switch.”

In May 2021, the Republican legislature had approved a contentious gas tax increase – Missouri’s first in 25 years. A portion of gas tax money goes into the State Road Fund.

In the eyes of some Republicans, passing an unpopular gas tax increase was a political risk. And MoDOT’s lawsuit to use state road fund money for pay raises just months later was an unwelcome plot point.

Sen. Cindy O’Laughlin, R-Shelbina, authored a letter at the beginning of last year’s legislative session demanding MoDOT’s director resign or be fired.

In the letter, O’Laughlin called MoDOT’s actions “a classic bait and switch” because MoDOT’s director “pleaded with the legislature for his entire tenure that he needed more funds to improve our state’s deteriorating road system,” but then planned to divert funds for pay raises.

A year later, at the February confirmation hearing for two new Transportation Commissioners, Rowden reiterated O’Laughlin’s contentions that some legislators “put our neck pretty far out on the line politically” in favor of the gas tax increase, only to see “pay raises for top-level folks.”

More recently, Rowden said Mayhew’s resolution to amend the constitution and limit MoDOT’s spending authority would have a hard time passing in the Senate.

“I understand anybody’s concern with MoDOT and the issues that they’ve had over the course of time … Personally I just don’t believe this is the right way to address the issue. I think there’s other ways we can get at it.”

Which way to I-70 expansion?

So far this session, three lawmakers have discussed proposals to fund the billion-dollar plus expansion of Interstate 70 – none uses the state road fund.

Instead, they’ve crafted plans that manage I-70 project funds through legislature-controlled budget processes.

Senate Appropriations Committee Chairman Lincoln Hough, R-Springfield, has discussed a plan to that goes beyond the governor’s budget recommendation of $859 million to redo three key sections of I-70 in Kansas City, Columbia and St. Louis. On Tuesday, during the Senate Appropriations Committee budget meeting, Hough announced the details of his proposal and added line items to the budget.

“It’s the intent, hopefully, of this committee to expand on that project, and build the entire roadway, three lanes, both directions. It’s about a $2.8 billion plan. The intent is to put $1.4 billion in an I-70 construction fund and then bond the other half of the cost of this project for, at the maximum, 15 years,” Hough said.

Sen. Bill Eigel, R-Weldon Spring, is sponsoring a bill that creates a new state fund, the “Interstate 70 Improvement Fund.”

Eigel’s proposal would use yearly deposits from budget surpluses to build a three- or four-lane interstate along the corridor. The legislature would appropriate the fund.

House Budget Committee Chairman Cody Smith, R-Carthage, has proposed using capital improvement budget bills to fund the governor’s $859 million budget recommendation. Smith’s proposal relies on a project funding process controlled by the legislature.

“House leadership is united insofar as we believe that investing in our state’s transportation infrastructure network when we have extra revenue is a very sound investment for the people of the state,” Smith said. He said he’s heard from some Senate members that infrastructure is a good investment when the state has extra funds.

While Smith said he’s frustrated with the deterioration of the legislature’s relationship with MoDOT over the years, these difficulties shouldn’t get in the way of fixing Missouri’s transportation network while the state is in a financial position to do so.

“If we don’t fix our roads and bridges because we’re mad at MoDOT, then really only our constituents are losing at the end of the day,” said Smith, echoing Rowden’s comments. “And I don’t think that’s the way we should approach it.”