New Orleans spends a fraction of what it needs to on street maintenance, group says

By Wilborn P. Nobles III

Source: NOLA.com | The Times-Picayune

May 9, 2017

The city of New Orleans only spends an average of $3.8 million annually on street maintenance tasks like pothole repairs — a fraction of the $30 million to $35 million officials say they need to cover the costs of maintaining the city’s roads, according to a new report from a private, nonpartisan research group.

The good news, according to The Bureau of Governmental Research report, “Paying for Streets: Options for Funding Road Maintenance in New Orleans,” is that New Orleans has money for streets coming its way. It’s about to get $1.5 billion in FEMA funding to repair streets damaged during Hurricane Katrina. But that money is expected to last just eight years, and the report says the city must take the opportunity now to find ways to increase street funding in the long term.

“While there is no question that the City needs more money for streets, this does not necessarily mean it needs more money from the public,” the report, released Tuesday (May 9) stated. “Policymakers owe it to the public to find a way to deploy existing tax revenues optimally.”

BGR continues to advocate, as it has for years, that the city redirect funds to street maintenance needs from sources such as traffic camera tickets, parking tickets, parking meters, parking taxes and vehicle sales taxes. The report stated these revenue sources will generate $52.2 million this year, which is more than five times the $9.5 million that New Orleans budgeted for streets in 2017.

However, the report added that using these revenues for street maintenance “would likely” require budget cuts because the city currently uses the funds for other purposes. BGR nonetheless added that the city estimates every dollar invested in street maintenance can save four or five dollars in repair costs down the road.

Although it described New Orleans streets as being in “deplorable condition,” BGR added the city is making some progress in rectifying this after coordination has improved between its public works department and the Sewerage and Water Board. Previously, the group drew attention to how newly repaved streets were torn open to repair pipes beneath them.

Last August, a city-funded assessment of New Orleans streets found that 44 percent of its 1,500 miles of streets are either in very poor condition or are on the verge of falling into the category. The city estimates these “capital repairs” will require $5 billion.

For these capital repairs, BGR stated the city identified $1.9 billion in capital funding, which includes the FEMA funding, $222 million from city-issued bonds, and $187 million from federal grants. But those are one-time revenues, likely to be spent by 2025, the report says. BGR stated New Orleans will have a shortfall of at least $3.1 billion for street restoration in the long term.

The report includes the following as options to fund street maintenance:

• The city could use a portion of the money it generates from traffic tickets and other fines and fees for streets, while likely making cuts in other areas.
• The city currently has $8.5 million designated for streets, but some of it is spent on traffic signals and drains. The city should make sure all of the money it has dedicated to street maintenance is spent on street maintenance.
• The city could consider new types of taxes or fees. The report suggests that imposing a “transportation utility fee” or a local fuel tax are “among the most suitable options” even though they would be difficult to implement.
• The transportation utility fee would treat street networks like a public utility, meaning property owners would be charged to maintain the streets based on estimates of how many vehicle trips occur from that property. The local fuel tax, the report added, would require a state constitutional amendment.

If the Louisiana Legislature raises the state gas tax, they should dedicate a portion to local streets and infrastructure, the report says.

This table from BGR shows what the dedicated street revenue in New Orleans is compared to city expenditures. The highlighted figures display revenues the city did not spend on streets, drainage and traffic signals as required.

The full report can be found at www.bgr.org.

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