1. Virginia Transportation Finance A Primer Presented by: Tom Boyd VDOT Asst Commissioner for Finance

2. Highway System  Total State Maintained Highway Sys. 56,700 mi. State Highway System 9,450 mi. State Highway System 9,450 mi. (Interstate and Primary Systems) Secondary System 47,250 mi. Secondary System 47,250 mi.  Urban System (Locally maintained) 10,200 mi. Total Highway System includes almost 12,000 bridges, four under water and two mountain tunnels, toll roads and toll bridges, and ferry services

3. Transportation Finance 101  3 Ts of Transportation Finance  Allocation Requirements  Financing

4. 3 Ts of Transportation Finance  T axes  T olls  T ake funding from someone or something else

5. Taxes

6. Taxes of All Types  Taxes Fuel Tax (Federal and State) Fuel Tax (Federal and State) Vehicle Sales Tax Vehicle Sales Tax Sales Tax Sales Tax Special Taxes Special Taxes Income Tax Income Tax General Fund Taxes General Fund Taxes

7. Fuel Tax Rates  Both federal and state are based on an amount per gallon sold  Virginia 17.5 cents for gasoline/ 16.0 cents for diesel --- Federal 18.5 cents per gallon  Regional Fuel Taxes NC - 21.2/21.2 NC - 21.2/21.2 MD - 23.5/24.25 MD - 23.5/24.25 WV - 23.35/23.35 WV - 23.35/23.35 KY - 16.4/13.4 KY - 16.4/13.4 TN - 20.0/17.0 TN - 20.0/17.0 PN – 25.9/30.8 PN – 25.9/30.8

8. Motor Fuel Tax Receipts $ millions million gallons $ millions million gallons  VA - 778 4,574  NC - 1,0425,035  MD - 6462,913  WV - 2951,103  KY - 4402,903  TN - 7173,751  PA - 1,6966,317

9. Taxes of All Types $ million $ million  Taxes Fuel Tax784 Fuel Tax784 Vehicle Sales Tax491 Vehicle Sales Tax491 General Sales Tax386 General Sales Tax386 Special Taxes 41 Special Taxes 41 Income Tax - Income Tax - General Fund Taxes 86 General Fund Taxes 86 Other204 Other204

10. Federal Reimbursements $ million $ million  Interstate/NHS293.8  Surface Transportation191.3  Minimum Guarantee 74.1  Bridge 94.4  CMAQ 38.4  Other283.2

11. Tolls

12. State Owned Toll Facilities $ millions $ millions  Dulles Toll Road39.7  Powhite Parkway 9.8  Coleman Bridge 4.7  Pocahontas Parkway open in FY 03

13. The Allocation Process

14. Allocations and Cash ( Page 1)  Virginia Code requires that financial resources be allocated as follows “…”allocation” shall mean a commitment to expend funds…” (Section 33.1-23.01 Code of Virginia) “…”allocation” shall mean a commitment to expend funds…” (Section 33.1-23.01 Code of Virginia) First allocation is an amount deemed necessary for maintenance of roads First allocation is an amount deemed necessary for maintenance of roads Next allocation is for administration and general expenses Next allocation is for administration and general expenses

15. Allocations and Cash (Page 2) After maintenance and G&A, allocations are to be made for the match for federal funds After maintenance and G&A, allocations are to be made for the match for federal funds After any other “off-the-top” items, the balance of funds are to be allocated: After any other “off-the-top” items, the balance of funds are to be allocated: 40% to the Primary System 40% to the Primary System 30% to the Urban System 30% to the Urban System 30% to the Secondary System 30% to the Secondary System

16. Allocations and Cash (Page 3)

17. Take Away

18. Sources of Take Away  Federal “earmarks”  Legislatively Designated  Off-the-Top

19. How a Take Away Works

20. Transportation Funding Flow Estimated Revenues X,XXX,XXX,XXX Current Project planned expenditures (XXX,XXX,XXX) Debt Service (XXX,XXX,XXX) Highway Maintenance (XXX,XXX,XXX) Operations (XXX,XXX,XXX) Available for new projects XXX,XXX,XXX

21. Building Blocks Sound Cost Estimates Revenue Projection Development Pipeline Project Delivery Legislative Commitment

22. Impact of Inaccurate Building Block

23. Innovative Finance (Debt)  Issued $375M in year 2000  Restricted to PTF projects  Budget Amendments  Allows issue of $317M to be allocated by formula  Allows rest to use on GF projects  Increases authorization to $1,200M