The real story here is that Delaware's leaders might be willing to raise taxes on citizens that have been in economic distress since at least 2008. RC

DelDOT's future looking grimmer

http://www.delawareonline.com/article/201101250345/NEWS/101250333?odyssey=mod_related_topix

Reports indicate shortfall could climb to $90 million by next year

By JEFF MONTGOMERY and MAUREEN MILFORD • The News Journal • January 25, 2011

Estimated shortfalls in state road and transit funds deepened Monday in new DelDOT reports on budget scenarios.In one increasingly likely case, revenues would fall about $90 million short of need next year alone if lawmakers decline to again shift unclaimed financial assets, or escheats, to the Transportation Trust Fund.

Gov. Jack Markell is eyeing escheats as a possible source for a proposed new Infrastructure Trust Fund to support economic development initiatives.The grim picture emerged on a day when DelDOT Secretary Carolann Wicks continued damage control and a management shakeup triggered by revelations about questionable and costly agreements involving developers and politically connected figures in southern Delaware brought to light in a series of News Journal stories. A review ordered by Markell recommended the reforms and led to the departure last week of two top managers in DelDOT’s planning and real estate section.

On Monday, Wicks proposed new regulations that would assure more public and legal scrutiny for deals on land secured far ahead of state needs.The regulatory change would require independent appraisals and legal reviews for contracts to keep land open and undeveloped before final decisions on right-of-way needs. It also would require disclosure of purchase and reservation details in contracts signed by DelDOT and the property owner.

Wicks also proposed clearer-cut requirements for review and "Our goal is to make DelDOT's real estate policies as transparent, consistent, cost effective and fair as
they can be. These regulations are an important part of that effort," Wicks said in a written statement.

Wicks' proposal for new real estate regulations on Monday followed the recent release of a 53-page report by Markell's staff focused mainly on agreements involving land along a U.S. 113 study corridor that led to deals that paid developers millions to forgo construction on projects pending a final decision on the highway route. Experts said the projects could not have been built anyway because of the recession.

Later in the day, Wicks told a task force studying Transportation Trust Fund revenues that even the latest long-range budget estimates could understate pressure on DelDOT's programs. Officials now see shortfalls growing to $140 million or more by 2016, with new calls on state funds arriving regularly.

Project at UD

As if to underscore that point, the University of Delaware indicated Monday that it might seek $25 million in state aid over several years for transportation-related work at a planned research, manufacturing and educational complex on the site of the former Chrysler assembly plant in Newark. Although plans remain rough, 10,000 to 15,000 people could work at the complex in coming decades.

Many would have to come and go by train or bus, using facilities yet to be budgeted or built."The rail improvements [needed] are huge, huge," Wicks cautioned. "If you look at that plan, it can't succeed without the rail. There's just not enough road around there. It's got to be based on the rail side of the house, and it's a six-figure problem."

Wicks later said that new Newark transit facilities and track work would cost in excess of $100 million, a figure that would support creation of a major regional commuter rail hub -- but one that is not now in any long-range budget.

Lawmakers formed the task force last year and set a March 31 deadline for reports on ways to balance the trust-fund budget. Members are expected to work through a list of alternatives in coming weeks, ranging from raising motor fuel taxes, highway tolls and motor vehicle fees to shifting some DelDOT operating expenses back to the General Fund budget and increasing fares for public transit.

Both Wicks and Delaware Economic Development Office Director Alan Levin said they were caught off guard by the university's $25 million need at the Chrysler site, brought up during a briefing on redevelopment plans. Levin did say that the plan needs transportation improvements to support new jobs.

Other revenues could be found for the Trust Fund, Levin added, including possible leasing of state assets to private businesses. State officials have suggested long-term private operation of I-95 or Del. 1 in the past.

"If we could take an asset that we're not maximizing the value of today and possibly lease that and get the benefit today and build a better Delaware, it's something we need to look at," Levin said, "but that's not without its pain and not without its controversy."

Contact Jeff Montgomery at 678-4277 or http://ezurl.co/551991.Contact Maureen Milford at 324-2881 or http://ezurl.co/569a91