Norris, governor expand fund feud

Senator wants end to diversion of highway money to shore up state budget

By Richard Locker, Commercial Appeal
April 26, 2006

NASHVILLE -- Another skirmish is under way in the off-and-on political war between Gov. Phil Bredesen and state Sen. Mark Norris of Collierville -- this time over Norris' effort to halt the four-year-old use of tax money from the state highway fund for other programs.

At issue is $44 million, or 2.6 percent of a total state Department of Transportation budget of $1.7 billion for fiscal year 2006-07 that starts July 1.

The Tennessee Roadbuilders Association is lobbying hard to restore the diverted money to the highway fund in that budget, now winding its way through the General Assembly toward approval next month. Its members are private highway contractors that profit from highway construction.

In a speech to a business group last week, Bredesen accused the Senate Transportation Committee that Norris chairs of "an election-year scramble by a select few to cater to special interests (that) actually does threaten the principles of sound budgeting." The committee had voted 7-1 to end the diversion of highway fund money in the new budget.

Norris, R-Collierville, responded Monday with a candid letter to Bredesen and a news release saying he was "concerned about the hyperbole in your speech" and that "your statements on this matter are inconsistent with the facts."

Norris said the governor essentially is using tax money collected from motorists and intended for transportation on what the senator called "entitlement programs wholly unrelated to transportation" -- including a planned $20 million expansion of the prekindergarten program the governor is championing.

"I wonder if Tennesseans know they are pumping gas for pre-K every time they fill up," Norris said.

The issue dates to early 2003 when Bredesen took office facing a large budget shortfall. In addition to budget cuts, Bredesen won legislative approval to divert some money from the highway fund to shore up the general fund -- $30 million in FY 2003 and $65.8 million each the next three years, a total of more than $220 million so far. He proposed reducing the diversion in FY 2007 to $43.8 million.

The governor contends that eliminating the diversion, as Norris wants, amounts to "tacking on another $44 million to a budget that's already tight, and frankly without any plan for where the money is to come from." Bredesen proposes slowly eliminating the diversion, over the next two to three years.

But Norris said the revenue comes from taxes on fuel and vehicle registrations sold decades ago as user fees dedicated for roadways and transportation. "If the governor needs new revenue for new programs, then he should make that case to the taxpaying public and not divert funds from their intended purposes. If the administration has determined that the tax is no longer necessary for transportation, then the governor should reduce the gasoline tax."