The Moffat County Board of Commissioners has passed a resolution supporting a Nov. 2 ballot issue on whether the state should borrow $1.7 billion against future federal gas tax revenues to accelerate the construction of 28 highway improvement projects. And the Craig City Council is close on the commissioners' heels.
The Council will consider approving a resolution supporting the referendum at its meeting Tuesday.
The referendum is commonly referred to as "TRANs," (Transportation Revenue Anticipation Notes) and will allow the Colorado Department of Transportation (CDOT) to bond up to $1.7 billion in principal and up to $2.3 billion total from future federal gas tax revenues which are paid by Colorado drivers each time they fill their tanks with gasoline.
Before 1996, CDOT revenues were dispersed between six transportation regions across the state. Moffat County is in Region 3, one of the largest regions in terms of number of counties and total land. In August, 1996, CDOT created a list of 28 projects slated to receive funding priority over all other projects statewide. They were called "7th Pot" projects and it was estimated they would take 48 years to complete.
Since 7th Pot projects were designated, more than $100 million, or one-third of the annual CDOT budget, was appropriated to them.
That infusion of funds and additional legislative money brought the estimated completion time for 7th Pot projects down to 25 years.
The TRANs referendum will allow CDOT to use anticipated revenue to finance those 28 priority projects and that revenue will provide for a 10- to 12-year completion schedule.
Under the TRANs concept, CDOT will issues notes for purchase by the private sector. The proceeds from the sale of the notes will allow CDOT to construct many projects simultaneously, "thus allowing the completion of the overall list of projects," Referendum A Campaign Manager Dick Wadhams said.
Wadhams stressed the referendum was not an increase in taxes.
"TRANs will not slow completion or take funding away from any other projects," he said.
Crucial endorsements from the Western Slope are filtering into Gov. Bill Owens' office. Along with the Moffat County Commissioners, Club 20, Associated Governments of Northwest Colorado, Colorado Counties Inc., Colorado Municipal League and many other entities have shown support for the referendum.
City Manager Jim Ferree was asked by the City Council to draft a resolution supporting the issue.
"The concern is that if it doesn't pass, funds will be diverted from regular transportation districts to get these 7th Pot projects built," Ferree said. "Supporting this protects our regular transportation district."
According to Ferree, there is a CDOT and legislative effort to get these high-priority projects complete and that effort could drain CDOT funds. This plan enables those projects to be built quicker without impacting funds for the rest of the state.
"I think everyone assumes this is the best way to get these projects built and protect our funds," Ferree said.
Colorado is one of only seven states that does not use financing methods for transportation projects.
"Colorado has historically taken a 'pay as you go' approach to building highways," Wadhams said.
Ballot language limits CDOT to $1.7 billion in principal and $2.3 billion in total costs. The $1.7 billion assumes a 15-year repayment at 4 percent interest. According to Wadhams, the most likely scenario will be for CDOT to issue notes for $1.5 billion in principal at 5 percent interest with a 15-year repayment schedule.