Sunday, December 10, 2006

It’s About the Money

Finding the money for good public projects is always the test of public policy, but good public policy should drive the agenda vision rather than what money is currently available and investing in local transportation and downtown renewal is good public policy.

Editorial: Where's the money?
Published 12:00 am PST Sunday, December 10, 2006

The Sacramento City Council has decided to spend about $55 million to buy land for the new downtown train/bus station. In doing so, they have dug themselves a budget hole.

The original $284 million pricetag for this project did not assume that the city actually had to buy any land, according to the Sacramento Transportation Agency. And even in that original budget, the city didn't have a firm plan on where all the money was going to come from.

Local governments in Sacramento County have a favorite pot of money for such unmet needs, something called Measure A. But that pot already is spoken for. So some big projects are heading for train wrecks (metaphorical if not literal) unless leaders either find the money or scale back the project.

Sacramento County voters in 2004 renewed Measure A, which is a half-cent sales tax dedicated to local transportation projects. The tax will stay in place for 30 years. STA, which is run by a governing board of various local leaders, is in charge of doling out the transportation funds.

Last summer the STA board decided how to spend just about all this sales tax money for its 30-year lifespan. For example, it set aside $110 million for the new train/bus station downtown, known as the intermodal center. If the cost for this project goes up by about $55 million, as just happened with the deal to purchase the land under the center, financial support for the project from Measure A doesn't automatically grow by $55 million. In fact, it doesn't grow at all. It can't.

The same problem faces another high-profile local transportation project, the new road that will connect Elk Grove, Rancho Cordova and Folsom. When voters passed Measure A, the leaders at STA figured that this road project would cost somewhere in the range of $390 million. Based on very recent estimates, that cost has skyrocketed. A cheap version of this road project is now estimated to cost somewhere in the range of $750 million.