Funding Sources in Other States

Nontraditional Use of State Highway and Transportation Funds

Every state raises revenue for highway and transportation infrastructure through a state motor-vehicle fuel tax. Some states also raise funds through vehicle licensing fees. In many states, the laws governing how these funds are distributed exclude greenways and trails projects. In other states, greenways and trails projects have been successfully funded using highway and transportation infrastructure dollars, given they have an identified tie to improving the transportation system. The following best practice examples outline how other states have used highway and transportation funds for greenway-related projects.

• By constitutional amendment, Oregon dedicates 1 percent of state gas-tax revenue to providing improvements for bicycling and walking on state-managed highways. Michigan also has a 1 percent law.
• Illinois has a long-standing, annual dedication of $1.50 out of the car title transfer tax, for trail and bicycle pedestrian improvements in local communities; raising up to $5 million annually.
• California dedicates $1 million from the State Highway Account (gas tax-based), for bicycle transportation improvements, and the amount is scheduled to grow to $2 million in 2001 2002, to $3 million in 2003 and to $5 million in 2004. Maximum grants are $250,000.
• The California state legislature also created the Transportation Development Act, which dedicates .25 percent from the statewide 7.75 percent sales tax to public transit support. The funds are returned to the county of origin where the regional transportation planning agency (often the MPO) may set-aside 2% of the funds for bicycle and pedestrian projects. In San Diego County, where this set-aside has been established, funding levels amount to about $1.7 million per year.
• New Jersey has created a bicycle and pedestrian facility set-aside in its local-aid program by Gubernatorial directive. Municipalities and counties can apply for these funds for local projects. The money comes from the NJ Transportation Trust Fund (mostly state gas taxes and highway toll revenue). Because actual spending of the funds has lagged, and local requests exceed actual awards for projects by several times, advocates are currently pushing for a provision in the Trust Fund reauthorization bill that would require the NJ Department of Transportation to implement 200 miles of bikeways per year during the 4-year life of the new Trust Fund.
• California passed a new state law in 1999 that allocated 1/3 of the federal Hazard Elimination monies (a portion of the 10 percent Safety Set-Aside of Surface Transportation Program funds) to projects that encourage kids to walk and bicycle to school. This amounts to about $20 million annually for the next two years. While this example does not primarily involve use of state revenue, it is a notable state action to further dedicate federal funds.
• Likewise, New York State DOT is in the process of creating a grant program for traffic calming projects on Long Island. Towns and villages will apply for the money with specific traffic calming project proposals. The first year of the program will use $3 million of the same federal Hazard Elimination funds.
• In Indiana, drivers are paying extra for special license plates that benefit greenways, open space, parks and trails. In 1995 about $1.9 million was netted from sale of 75,740 plates. The plates cost an additional $35, of which $25 goes to the Indiana Heritage Trust. Maine and Florida use similar license plate fee add-ons for conservation, parks and bicycle and pedestrian program funding.

Local Fundraising

Other states rich in greenway development have extensively used local fundraising to supplement government funding. Local fundraising allows communities and local governments to raise needed funds for greenway and trail related projects outside of traditional grant and loan programs. Advantages of local fundraising include accelerating project delivery schedules, flexible use of funds, and timely improvements to the community.

Three common approaches to local fundraising include: special bond issues, dedications of a portion of local sales taxes or a voter-approved sales tax increase, and use of the annual capital improvement budgets of Public Works and/or Parks agencies. Examples found elsewhere in the nation include:

• San Diego County residents voted to impose a 1/2-cent sales tax for transportation purposes. Out of those funds ($171 million in year 2000), $1 million is set aside for bicycle projects. The tax is administered by the San Diego Association of Governments and is scheduled to expire in 2008.
• The City of Albuquerque, New Mexico, and Bernalillo County, both have a 5% set-aside of street bond funds which go to trails and bikeways. For the City, this has amounted to approximately $1.2 million every two years for these facilities. The City voters last year passed a 1/4 cent gross receipts tax for transportation which includes approximately $1 million per year for the next ten years for trail development. In addition, many of the on-street facilities are being developed as a part of other road projects and are incorporating the bike facilities in the roadway budget for new roads, or when a resurfacing project is planned.
• Pinellas County, Florida built much of the Pinellas Trail system with a portion of a one cent sales tax increase voted for by county residents.
• Seattle, Washington, and King County voters approved a $100 million bond issue to protect open space in the urban area; $33 million was set-aside for trail development. The Seattle Department of Public Works used about $6 million per annum for the City's bike program.
• Denver, Colorado also invested $5 million in its emerging trail network with a bond issue, which also funded the city's bike planner for a number of years.
• Eagle County, Colorado (which includes Vail) voters passed a transportation tax that earmarks 10% for trails, about $300,000 a year.
• In Colorado Springs, Colorado, 20 percent of the new open space sales tax is designated for trail acquisition and development; about $5-6 million per year.