The road to ruin runs through the center of Raleigh these days, starting at the doorsteps of the legislative leadership and Gov. Mike Easley, who have engaged, quite literally, in highway robbery.
No longer content to rely on North Carolina’s traditional sources of revenue the last couple of years the governor and his allies raided all of the state’s liquid assets and transferred the money to other projects that were more aligned with their political preferences. The juiciest plum to land in their basket was the Highway Trust Fund.
Easley plucked it to the tune of $80 million in February, and will take $205 million more this year. Highway advocates fear that this is just a start, that in the future the trust fund will exist merely as a cash cow to be milked continually by the political class.
Easley’s pet project, More at Four, yes. Tax reimbursements for localities, no. Giveaways for business “incentives,” yes. Highway construction, no. And on it goes.
By denying full funding to highways, Easley also accomplishes other goals of his administration. One is to appease radical environmentalists and the Smart Growth crowd, who see road construction as the bane of society. Then, too, the state’s financial crisis apparently provides the cover Easley needs to seize monies during an “emergency.” That way, he can continue to buoy his pet projects while draining those that don’t suit his tastes, all ostensibly for the purpose of rescuing a foundering ship of state.
But now the hijackers’ victims are fighting back. The architects of the Highway Trust Fund filed a lawsuit on behalf of the state’s taxpayers to retrieve the people’s money. The lawsuit, filed Nov. 14 by former Transportation Secretary Jim Harrington and former state Sen. Bill Goldston, follows another case that was recently filed by 22 cities and counties to recover hundreds of millions of dollars in local tax revenues seized by Easley.
Raleigh lawyer Eugene Boyce is representing Harrington and Goldston in their lawsuit. Boyce is also litigating the localities’ case against the state. Boyce argues that the constitution authorizes the governor to “effect the necessary economies in state expenditures,” but that the governor may not use money from dedicated funds.
If past performance is any indication, the Easley crowd has grown accustomed to running for cover. Boyce’s record in major lawsuits against the state is perfect: five wins and zero losses.
According to a study performed by the University of North Carolina at Charlotte, in 1984 the state ranked eighth in the nation for its quality and efficiency. By 2000, North Carolina had sunk to 25th. If the free fall continues, North Carolina could rank at the bottom of the national heap before long.
During the 1990s state road maintenance failed to keep pace with inflation, resulting in a $290 million backlog of road and bridge repairs, a report by the state Department of Transportation showed. During the same period, the amount of traffic on North Carolina roads greatly outstripped road capacity. In 1990, vehicle miles traveled was equal to the amount of paved lane miles. In 2000 vehicle miles traveled were 40 percent higher than in 1990, while the mileage of paved roads increased by just 16.9 percent.
North Carolina taxpayers pay for state highways through taxes on motor fuels and vehicles. Expenditures from the state’s highway funds have grown significantly in nominal dollars over the past 20 years, to $2.1 billion in fiscal 2001-’02, and North Carolina levies a relatively high motor fuels tax rate. But that’s not the whole story. Adjusted for inflation and the numbers of vehicle miles traveled, highway expenditures actually decreased over the past two decades. Per-capita state and local spending on transportation grew at a much slower rate than spending on education, welfare, health care, and overall government spending.
At a press conference in which they announced their lawsuit, Goldston and Harrington showcased Article 5, Section 5 of the state constitution upon which they rest their case. “Every act of the General Assembly levying a tax shall state the special object to which it is to be applied, and it shall be applied to no other purpose,” the passage reads. Simple enough, as Harrington said, that means “hands off.”
Unless the observer is Easley, Senate leader Marc Basnight, or House Speaker Jim Black, who, based upon past behavior, will treat any monies as though they were their own personal slush funds, to be appropriated for whatever purpose they deem appropriate at the time.
Under their rules, why should state government continue to function under any pretense of a republican democracy? Why have a constitution? Why bother with legislation? North Carolina’s political leaders seem hell-bent to continue their desperado ways until the courts rein them in, again and again.
North Carolina’s taxpayers are lucky to have Harrington and Goldston leading the charge on their behalf this time. It’s tragic, though, that day in and day out, someone has to rise to the task of taking public officials to court to reclaim funds spent contrary to law.
Richard Wagner is the editor of Carolina Journal, monthly newspaper of the John Locke Foundation.