Remarks for Secretary Lyndo Tippett
N.C. Association of Government Accountants
Tuesday, Nov. 8, 2005 at Noon
Raleigh
Thank you for that introduction.
I am pleased to be here today among fellow CPAs.
As a CPA, I realize just how important it is to carefully manage money and make the most of our economic resources, and I thank you for the role that you play in ensuring the financial well-being of our state.
In addition, as Secretary of Transportation, I also realize the important relationship that exists between transportation and economic prosperity.
Transportation projects play a critical role in the future economic growth of communities throughout the state, and the value of high-quality transportation cannot be underestimated.
Given this, I want you to know that I take the mission of our department to expand opportunities for all areas of the state through a safe, modern and integrated transportation system very seriously.
Our state is growing rapidly as more and more people recognize that North Carolina is an outstanding place to live and do business.
With this growth comes various challenges. Our interstate system is aging and in need of major rehabilitation.
And many of our roads that were once built as farm-to-market roads now serve as major arteries carrying citizens to jobs and schools and need significant upgrades to handle this traffic.
It is obvious that given our current resources, our road construction and maintenance efforts cannot keep up with the increased demand being placed on our infrastructure.
This situation is intensified by a rise in construction inflation-more than 30 percent over the last two years alone-that makes it more costly for us to complete needed projects. The funding shortfall will only increase with time.
Two years ago, we held public forums across the state to gather information on transportation needs and priorities.
In the end, we came forward with a long-range statewide transportation plan, which was adopted by the Board of Transportation last fall.
That long-range plan anticipates a $16 billion gap between transportation need and funding over the next 10 years, and nearly $30 billion over the next 25 years.
This situation underscores the importance of being fiscally prudent and responsible.
Meeting More of Our Needs
NCDOT is working hard on many fronts to better meet more of our state's transportation needs. These efforts include:
1. Implementing the long-range statewide transportation plan to make better use of existing resources and put our money where it is needed most.
The plan will allow the department to meet an additional 35 percent of the maintenance, modernization and preservation needs of our existing infrastructure.
It also significantly increases funding for alternative modes of transportation such as public transportation, rail and ferry.
2. Executing short-term programs such as N.C. Moving Ahead! and Senate Bill 1005 (a special provision in the 2001 budget bill that allowed NCDOT to tap into its cash balances for maintenance and preservation projects) to complete some of the state's most pressing maintenance and modernization projects.
3. Streamlining our operations through measures such as the Ecosystem Enhancement Program (EEP) and the design-build program that allow us to improve project delivery time.
We are also increasing our emphasis on pavement preservation techniques, which allow us to treat and seal roads that are in good condition today to avoid timely and costly road repairs and deterioration tomorrow.
4. Implementation of new programs to reduce damage to our highway infrastructure due to overweight trucks
In partnership with the N.C. Department of Crime Control and Public Safety, NCDOT began implementing a new transponder system to help monitor trucks traveling into and through our state.
The new system allows truck drivers who have a good history of weight, safety and tax
compliance as well as up-to-date credentials to bypass weigh stations, except for the occasional spot check.
This will increase the efficiency and effectiveness of the state's weigh stations and allow Motor Carrier Enforcement to focus more efforts on the state's secondary roads.
Monitoring equipment will be installed at six port-of-entry weigh stations along the
interstate borders, as well as other strategic locations throughout the state. The new program expands upon a pilot/demo TransExpress system already in place at the I-85 eastbound station in Hillsborough.
5. Working with N.C. Thinking Ahead!
In addition to our internal efforts, the department has also been working with several external groups to develop new ways to fund transportation improvements in North Carolina.
The first is a new working group I formed at the direction of Gov. Mike Easley called N.C. Thinking Ahead!
The goal of the group is to put together realistic recommendations on how we can meet our state's short- and long-term transportation needs.
It brings together a wide range of transportation stakeholders and experts from across the state to examine short-term needs such as safety, maintenance and economic development.
The group just completed a series of regional forums across the state and also an Internet poll to help gauge public opinion on the importance of transportation and gather input on ways to meet our future transportation needs.
Data from both of these will be used in preparing the group's final report.
In addition, our other external efforts have included:
6. The N.C. Turnpike Authority which would use toll financing to help deliver needed
projects to communities sooner, providing citizens with more transportation options and reducing traffic along some of the state's most congested routes. The first of these projects should come on line in about a decade.
7. Increasing the Use of Public-Private Partnerships to finance transportation projects through a combination of public and private investments. We are pursuing further legislation on this front.
8. Increased Federal Funding. The most recent reauthorization bill provides more money for transportation improvements and increases our federal rate of return, bringing more money back to North Carolina.
9. Continuing to work with the N.C. General Assembly. This summer, Gov. Easley signed legislation giving us greater flexibility with our secondary road funds, allowing us to meet more of the state's maintenance and modernization needs.
He also signed a bill approving $900 million in Grant Anticipation Revenue Vehicles, or GARVEE bonds, to accelerate federal funding to pay for large projects of statewide significance.
We hope to begin developing criteria for these projects over the next month.
Conclusion
Working together, I know that we can face these challenges and find innovative ways to better meet our transportation needs.
I welcome your input and ideas.
Our needs are great, but so is the talent and expertise of the individuals assembled in this room.
I'll now turn this over to NCDOT's Chief Financial Officer who will present on the departments cash management approach.