The COLUMBIA TRIBUNE
Thursday, October 14, 2004

The Tribune's View
Amendment 3
Which way diversion?

By HENRY J. WATERS III, Publisher, Columbia Daily Tribune

Amendment 3 on the Nov. 2 ballot is an effort by economic development and business interests to increase funding for road and bridge construction in Missouri without raising fuel taxes. They would do this by removing the money from state general revenue.

Promoters have a beguiling argument: "Better roads. No new taxes." True enough, but at what cost?

The proposition would end the currently required "diversion" of some $160 million per year in motor fuel and vehicle sales taxes from general state revenue into a new State Road Bond Fund to underwrite new borrowing for road construction.

Opponents say that when fully phased in, the amendment would "divert" some $187 million a year from education, health care and other worthy uses, putting an intolerable strain on an already stretched state budget.

As a general public funding proposition, Amendment 3 is bad law. It expands spending earmarking, removing a substantial chunk of state revenue from budgeting by the General Assembly. Even if one believes we need more money for roads, as I do, this is not the best way to get it.

Opponents are right when they say there is no free lunch. Unless we assume blithely that this newly earmarked money need not be replaced, a proposition no advocate of current spending will buy, additional revenue will be required - and at a time when general revenue budgets already are at depressed levels. Politicians are scurrying about like fleas, all promising to increase or, at least, not to reduce education funding, the state's largest budget item. The Amendment 3 "diversion" cannot be absorbed without associated tax-increase implications.

I think it's a good idea to raise $150 million or $200 million in new money to underwrite transportation bonds, but we should do it by raising fuel taxes a few pennies, particularly on diesel users, not with a permanent removal of funds now going to general revenue.

This sort of budget prioritizing should be done by the General Assembly. The money targeted by Amendment 3 proponents is not money that "rightfully" should go for roads. Originally, all vehicle sales taxes went into general revenue, then in 1979 half was "diverted" into a state road fund. Now, Amendment 3 would require in the state constitution the "diversion" of the rest of this revenue. Instead of ending diversion of money from rightful transportation funds, it's easy to argue Amendment 3 would increase diversion of general revenue into transportation.

We can argue endlessly about details of how this chunk of state revenue should be used - public transit vs. regular highways, education vs. health. The larger and more important issue is what kind of structures we create for the raising and spending of public revenue.

Earmarking such a specific part of it by constitutional amendment is fundamentally a bad idea. Let's vote "no" on Amendment 3 and then look for better ways to increase transportation funding.

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