Falling oil prices bring little change to current E. Texas road projects

Falling oil prices bring little change to current E. Texas road projects
Source: KTRE Staff
Source: KTRE Staff

LUFKIN, TX (KTRE) - As crude oil prices continue to fall, more questions are raised about the future of transportation funding.

Because of the falling revenue from gas prices, the state of Texas will send less money to transportation in the next few years.

The state is putting $1.1 billion into transportation this fiscal year but that will drop by half to $594 million next year.

"Obviously, there is a lot of people almost hyperventilating with concern, I've thought about going around carrying brown paper bags with me to hand out to everybody," Texas Comptroller Glenn Hegar said in a recent transportation hearing in Austin.

State Representative Trent Ashby understands both sides of the issue.

"It really is a double-edged sword," Ashby said. "Sure people love to fill up and save money, but at the same time the energy sector lost 30,000 jobs in the state."

Ashby said future funding is needed for the area that has several ongoing construction projects.

"When you look at the bulk and the majority of our state highway infrastructure is located, it's right here in rural Texas," Ashby said.

State Senator Robert Nichols is the chairman of the transportation committee and said while it may look negative, the state is healthy.

"When we passed Proposition 1, we knew that that would be a fund that was fluid," Nichols said. "We went to the legislature and said Proposition 1 is only part of the solution. So we got Proposition 7 passed this last time to help with that. The federal government also finally did long range transportation funding."

Nichols also said the state has a good system set up if an emergency happens.

In the 1980s we realized the oil business went up and down, so we created a rainy day fund," Nichols said. "That has gone so large, and we are able to not put that in our annual budget plans so we have it to fall back on if needed. I won't name any other states but there are some that rely on oil money and they don't have this type of fund. They are hurting right now."

State Representative Travis Clardy believes the issue of funding transportation is one that will always be a concern to lawmakers.

"Transportation is one of those problems that never gets solved and never gets solved because we keep driving on roads, building more roads, and wearing out old roads," Clardy said.

In his remarks to the committee, Hegar said Texas should be able to ride out the downfall in oil prices because of a more diverse economy.

"Texas is not the Texas of the 1980s," Hegar said. "We now have a more diverse economy. Is oil and gas important to this state?  Absolutely, its 14 percent of our economy, but it's not the 20 plus percent of our economy it was in the 1980s."

According to David Glessner with TxDOT, all of the current projects that have already been started will continue to be funded.

"TxDOT recognizes funding may fluctuate from year to year and may need to be adjusted as the price and production levels of oil and gas change," Glessner said. "For this reason, long-term planning by local leaders, planning organizations and TxDOT will be based on estimates of projected annual deposits provided by the Texas Comptroller."

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