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Statement from E. Dean Carlson, Secretary of Transportation

November 12, 1999 (Release 99-248)
FOR IMMEDIATE RELEASE
News Contact: Marty Matthews, (785) 296-3585

Statement from E. Dean Carlson, Secretary of Transportation

Representative Phill Kline is obviously at it again: misrepresenting the facts to make money magically appear out of nowhere. He has taken accurate information provided to him by Legislative Research Services and conveniently used only half of it to make his allegations. Specifically, he has quoted a change in the revenue side of the equation without taking note of the consequent change on the expenditure side. This is similar to writing down only deposits in your checkbook and not worrying about the checks that you write. This is helpful if you want to appear to have money, but remains a total fabrication of fiscal responsibility.

The Kansas Department of Transportation is consistently refining its projections of revenues and expenditures for the ten-year Comprehensive Transportation Program. These are projections only. Unfortunately, Mr. Kline has seized upon the differences in these projections to construct an artificial solution to a very real problem. He proposes using money derived from just projections over a ten-year period to solve an immediate cash crunch. For someone who claims to be fiscally conservative, this seems to be financially foolish.

There is no truth to his allegations of a "windfall" to the highway program of $475 million. It is true that a comparison of only the revenue projections made in April and those made in September yields that difference. Here is why:

• KDOT increased its projection of interest earnings on bonds by $90 million because the bonds were sold earlier than expected. Mr. Kline fails to add that the early sale also resulted in a debt service increase of $180 million over the first ten years of the bond program.
• KDOT increased its projections of federal aid based upon two factors:
  • We included federal dollars that are only available for specific projects, so-called Demonstration projects. Those funds must be used on those projects and only those projects. This is about $131 million
  • We increased the amount by another $113 million to reflect a change in the timing of the receipts for federal projects. This allows KDOT to have projects qualified for federal funding early so those funds are ready to be drawn when available. This is a technique allowed under federal law called "advanced construction." Again, this figure is only a projection. If KDOT doesn't build the project, it doesn't get the money.
• Total of both factors approximately $ 246 million.
• We increased our beginning balance for the Comprehensive Transportation Program by $84 million. This is money owed to contractors for projects under contract. The bills have not been paid yet. But they will come due and this money is not available for any other purpose.
• There is also a $16 million adjustment to reflect that we may get a slightly higher price for future bond issues than previously anticipated. This is an assumption only.

You may recall that Mr. Kline tried a similar tactic near the end of the last legislative session. He cleverly manipulated figures to inflate the amount of money available to KDOT as part of his effort to scuttle the Comprehensive Transportation Program. Fortunately, a majority of his fellow lawmakers saw through the misrepresentation then, and I'm hopeful they will see through it once again this time.