Interim Director of the Arizona Department of Transportation John Halikowski discusses the challenges and opportunities facing his agency.
Ted Simons: Joining me now is interim director of the Arizona department of transportation, John Halikowski. He was appointed in February by Governor Brewer and is now awaiting senate confirmation. Thank you for joining us on "Horizon."
John Halikowski: Thank you, Ted. It's good to be back at my old alma mater.
Ted Simons: You are now, though, going to be running the department of transportation. What's your vision for that department?
John Halikowski: Well, my vision for that department, Ted, is that department has tremendous ability to enable transportation and infrastructure to be accomplished throughout this state. By that I mean the department really needs to function as a partner to regional and local governments to accomplish those things.
Ted Simons: Is that the biggest challenge you see right now as well?
John Halikowski: It's a huge challenge, but another huge challenge facing us obviously is the budget crisis. We've got declining gas revenues, license tax, and the fund sweeps over the years have taken a lot of highway funds out of ADOT's control for construction and maintenance, and they filled gaps into the general fund.
Ted Simons: How do you feel about those raids and those sweeps?
John Halikowski: Well, they're concerning to me. Quite frankly, what happens is that as the legislature will pull the tax out of our operating funds, we have a lot of difficulty then in maintaining our roadways and making sure that we're delivering those projects out there for the public.
Ted Simons: OK. The budget crisis in general; how is that impacting what is being done around the state and what is not being done?
John Halikowski: Well, what's happening with it is that we have to produce every year an updated five-year construction and maintenance plan. And that's ultimately approved by the state transportation board. We're in the middle of those public hearings right now. We've just recently had one in Marana and will be traveling soon to Flagstaff to hold one there. When the revenues decline, and when funds are taken out of ADOT's operating fund, we have to then shrink that five-year plan down, because it must be fiscally constrained by law. So in essence what happens is we start deferring construction projects out beyond the five-year window, and also we're going to have to look at deferring some of our maintenance activities.
Ted Simons: And yet I can hear folks now saying you got your gas tax, your vehicle license tax, you got federal money coming in, still not enough. We had a proposition pass, still not enough.
John Halikowski: Well, remember, the half-cent sales tax is a Maricopa County sales tax. And so that half-cent tax funds construction projects and maintenance here in Maricopa County. Pima County also has its half-cent tax for construction projects. But when you look at greater Arizona out there, they're solely reliant on the gasoline tax for their transportation and maintenance, and what happens is that gas tax has been flat since 1991, there's no inflator built into it, and with a fuel efficiency and economy, we're seeing less people driving, we're seeing a decline in revenues.
Ted Simons: I was going to say, it's almost counterproductive sometimes to depend as much as we do on the gas tax. That being said, do you want to see inflation adjusted?
John Halikowski: I think the gas tax was probably a great idea when we were starting to build the interstate system in the U.S. in the 1950s. But again, as we're looking toward alternative ways of fueling vehicles out there, and we're looking towards different ways of taxing folks, I have to say that the gasoline tax is not something you necessarily want to hitch your wagon too, because quite frankly, it puts us dependent on foreign oil, and it's not necessarily good for the air. I think we need to look at alternative ways of funding transportation projects.
Ted Simons: And we just had a discussion on things like toll roads and user fees and these kinds of things. Are they viable here in Arizona?
John Halikowski: Well, that's a good question; because the devil's always in the details there. Will three bills currently that deal with these public-private partnerships, or some people will say, another road for toll roads. But the fact of the matter is that depending on what the structure of the bill is, they may be viable here. There are a number of companies we've been meeting with over the past couple years, investment companies, who are interested in public-private partnerships here in Arizona. We've got some folks dedicated at ADOT to working with that, and with the legislation. So we're excited and looking forward to it, because we see it as part of the funding picture.
Ted Simons: I know some critics will call this double taxation if it's a toll road or user fee involved; the gas tax increasing that inflation adjusting it, these sorts of things. There's an idea, and a very sound idea certainly at the folks that support this are loud in supporting it, that you can't increase fees or taxes, and expect business to either stay here, grow here, or relocate here. How do you work that dynamic with transportation?
John Halikowski: Well, I would counter that argument this way. Businesses and people want to locate where there's good infrastructure and smart growth. And if we manage the transportation and infrastructure system properly, we will build such a system to make this state economically viable. A.S.U.'s own Morrison Institute has looked at this area and said Phoenix, Tucson, Flagstaff; it's an emerging megapolitan area. We're going to have to get smarter about how we govern that area, and smarter about how we fund it. So to me, those decisions should be made regionally and locally by those voters.
Ted Simons: All right; very good. Thank you so much for joining us.
John Halikowski: Thank you, Ted.
John Halikowski:Interim Director of the Arizona Department of Transportation;