CEO Roundtable: NoCo transportation leaders have the will, but less so the funds, for road overhauls

Although strong political will remains to improve Interstate 25 and several other thoroughfares across Northern Colorado, a group of transportation officials and government leaders say the revenue damage from the pandemic is crimping a go-ahead attitude.

The group of 12 executives spoke remotely Tuesday morning at BizWest’s Northern Colorado CEO Roundtable on transportation.

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Municipal woes hamper momentum

David May, the soon-to-be-retiring CEO of the Fort Collins Area Chamber of Commerce, said momentum for repairing and expanding I-25 north of Longmont has grown to the highest it’s been in decades. He pointed to construction of climbing lane near Berthoud, which was the first capacity upgrade in that section of the interstate since the ‘60s.

But while commitments to the tune of hundreds of millions of dollars are already in place for large portions of the overall improvement project, the COVID pandemic and the squeeze on economic activity is forcing the state Legislature, the Colorado Department of Transportation and local governments to be more cautious with spending overall.

Loveland public works director Mark Jackson said the funds that were recalled by the state Legislature to balance Colorado’s budget in the wake of the pandemic-driven shortfall have made it difficult for him to commit as much funding as he’d like.

“We’re faced with really real choices about whether we even have enough funding to maintain what we have on the streets right now,” he said. “I would love to say that I’m going to expand the City of Loveland Transit [COLT]  system to connect to the regional mobility hub in two years, but it’s up in the air.”

Fort Collins mayor Wade Troxell echoed that sentiment, saying the city has put in $21 million of its own money toward North I-25 over the years, but it’ll be tough to continue that as long as the pandemic causes economic havoc.

“I think the commitment is still there, but it’s the practicality of how we can back and support that,” he said.

Alternate funding

May also chided what he sees as a move toward “geographic equity” from state officials and legislators, wherein funding for transportation improvements are spread across the state with less of a regard for where traffic is bad and likely to get heavier due to population growth. 

Barbara Kirkmeyer, Weld County commissioner, said the concept eschews solid transportation planning in favor of appealing to broader interests that don’t necessarily need the funding as much.

“I guess political equity is how I’m going to call it,” she said.

Kathleen Bracke, a member of the Colorado Transportation Commission representing Larimer, Weld and Morgan counties, said the total amount of funding isn’t changing due to COVID because CDOT is looking to tap $300 million from a federal line-of-credit program to offset any cuts from the state’s broader budget.

But she agreed that differing funding models should be put in place to determine how the state funds repairs and upgrades to major roadways versus smaller thoroughfares.

“We need to figure out a new way, a distinct way, to fund our interstates, rather than keeping them in the mix with all our other smaller-scale state highways,” she said.

The gas tax

Heather Paddock, the regional transportation director for CDOT’s region covering Northern Colorado and the state’s northeast corner, said the initial shutdowns caused traffic volumes to fall by 50% earlier this year before coming back to about 90% of the volumes seen in 2019 as of her latest information.

However, the majority of that volume is from people traveling for reasons other than commuting, she said.

“Although we’re going to see some changes in people working from home more frequently or maybe during off-peak travel times, there’s still a significant amount of volume on our corridors,” she said.

Suzette Mallette, executive director of the North Front Range Metropolitan Planning Organization, said CDOT has estimated losses of about $650 million in the past few months due to the drop in gas sales. Due to a lag in how the taxes are collected and distributed, she believes the financial pinch is coming for municipalities soon.

“Right around this time is when most of the state and local governments are going to feel that decline in the gas tax (revenue),” she said.

Sandra Hagen Solin, a lobbyist representing the Northern Colorado Legislative Alliance, said there was growing support for finding new revenue streams for transportation spending, including proposing an increase to the gas tax.

“We were securing bipartisan support; it was pretty remarkable where we were right about a week before everything dropped off,” she said. “We’re beginning to pick up some of those conversations, but of course, the dynamics have changed.”

Multiple roundtable members said a gas-tax increase proposal is not viable when a large portion of Coloradans remain unemployed or affected by the economic effects of the pandemic, and suggested that future discussions around the gas tax need to include removing subsidies and perks for electric-vehicle owners.

Joe Mitchell, the president and CEO of electric engine maker UQM Technologies before it was acquired by European firm Danfoss last year, said electric vehicles make more sense in densely populated areas, particularly to power public transit and heavy-use vehicles.

But he said any discussions about making electric vehicles more expensive within the regulatory process of registering or fueling has to be balanced against the economics of EVs and the larger efforts to reduce global emissions.

“What I’ve seen internationally is a very fragmented strategy, that it’s going to be one of the biggest challenges: How do you bring this together and have this future looking plan?” he asked.

Airports managing

Cooper Anderson, director of the Greeley-Weld County Airport, said while his airport received just $69,000 in CARES Act funding, it’s not as reliant on fuel sales that dropped as stay-at-home became the norm.

But while he’s looking for ways to shore up the airport’s revenue streams, including adding an additional solar panel garden on unoccupied land, he said fuel sales haven’t been as bad as expected due to certain passengers being less willing to take commercial flights.

“So far over the year, we’re about 3% over what we’ve predicted, and part of that came from a few corporate clients,” he said.

However, that airport has lost funding for some projects, including funds from the Colorado Division of Aeronautics for an apron rebuild.

Northern Colorado Regional Airport director Jason Licon said his airport got $16 million in CARES funding, much of which is earmarked for upgrading current infrastructure to make it into a more regionally reaching service point.

He said NCRA took a dive in ridership in the spring as all airports did, but that’s recovered as the outdoors is one of the few tourism options that easily allows social distancing.

“I’m cautiously optimistic right now that the amount of activity that we’re seeing right now will not taper off as the winter months come ahead,” he said. “We’re seeing a lot of folks traveling the mountains, the mountains have never been busier.”

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The CEO Roundtable is sponsored by Flood & Peterson, Plante Moran and Elevations Credit Union.

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