Pennsylvania Governor Corbett Signs a Major Transportation Funding and Prevailing Wage Reform Bill into Law

           Pennsylvania Governor Tom Corbett announced today that he would sign a major transportation bill into law Monday.  The Republican Chief Executive had made the bill his highest priority for the fall session of the General Assembly.  The GOP-led legislature approved the bill yesterday, giving Corbett a big political victory.

            The transportation act funds $2.4 billion in repairs to roads and bridges, as well as adding more funds for mass transit.  The repairs to the Commonwealth’s bridges were critically needed, as trucks have been forced to re-route because of weight restrictions on many state bridges that are structurally deficient.  In addition to the state transportation department, money is being appropriate to counties, which own a majority of the deficient bridges in the Keystone State. 

            The transportation funding measure does not raise taxes, but taxes will increase significantly because the cap on gasoline taxes has been raised.  Vehicle registration fees and fines will also be increased.  For motorists, however, gasoline taxes and these other vehicle fees, are more like user fees, like tolls are, than taxes.  Such user fees or flat-rate taxes should be adjusted regularly for inflation instead of waiting many years, as the revenue in real dollars decreases, for politicians to have to play the heavy and increase them dramatically.  Gasoline taxes in the Commonwealth have not risen since the 1990s.  Because many goods are shipped by truck, increases in gasoline taxes are inflationary, but by eliminating the detours, the bridge repairs will reduce fuel consumption.  The funding of other road improvements and the building new roads and bridges in the transportation act will further decreases gasoline use, which will mitigate the inflationary affect of fuel costs because of the increase in gasoline taxes.  Additionally, the road repairs will reduce damage to vehicles because of Pennsylvania’s infamous potholes. 

            Road and bridge work is one activity that has been shown to be economically stimulative.  Not only does it create temporary construction jobs, but it gives customers or employees easier access to existing businesses and encourages the building of new businesses.

           Conservatives won a major victory in the bill with implications beyond transportation in the form of prevailing wage reform.  Pennsylvania law had required the payment of high union wages for all contracts over the threshold of $25,000.  That threshold had not been changed for 50 years.  The new law raises the threshold to $100,000, which will save taxpayers a significant amount of money.