The Missouri Department of Transportation’s (MoDOT) growing funding problem has put the issue of state highway funding on the center stage. This focus on the state road system obscures the fact that most of Missouri’s streets are the responsibility, in terms of funding and maintenance, of local governments.
Missouri has more than 90,000 lane miles of local roads that are the responsibility of cities and counties, as compared to 33,000 lane miles of highways under MoDOT’s purview. While MoDOT receives most of its funding from fees placed on drivers, local roads do not. Counties and municipalities partially fund their streets with the 25 percent of state fuel taxes remitted to localities, but in most areas that is inadequate. Local governments, therefore, rely on local sales taxes, property taxes, and specially formed taxing districts known as transportation development districts (TDD) to pay for road improvements.
One source of funding localities technically could use—but do not—are local fuel taxes, even though they might be a fair and economically sound way to fund roads. Paying for streets with fuel taxes, as opposed to other forms of local taxation, also might have the benefit of limiting wasteful spending, because the Missouri Constitution stipulates that all local fuel tax proceeds must be spent on roads.
The likely reason no Missouri localities collect fuel taxes (although attempts have been made) is that the state constitution stipulates that voters approve any such measure by a 2/3rd majority. Other forms of local taxation, such as transportation sales taxes or property taxes, require only simple majorities. TDDs, semi-democratically created ad hoc taxing districts, also are much easier to implement than fuel taxes. It is, perhaps, unsurprising that while no city has a fuel tax, there are more than 170 TDDs in Missouri, collecting revenue with little accountability or oversight.
Moving forward, many of the funding problems that MoDOT faces for highways is mirrored on the local level. Counties and cities face street maintenance backlogs, and residents have noticed. Recent surveys in Springfield and Kansas City showed residents were highly unsatisfied with the state of local streets.
It is hard to tell what portion of the need arises from a genuine lack of funding and what portion is the result of misplaced priorities. However, as Missourians consider if more must be spent, they also should question how more would be raised, and whether the current methods are transparent and economically sound.