We broke the news here Wednesday of a demand by lawyer Richard H. Mays that the Arkansas Department of Transportation halt work on the billion-dollar 30 Crossing project in Little Rock because it was authorized under the expectation that Amendment 91 temporary sales tax money would pay for more than $400 million of the work.
The Arkansas Supreme Court has ruled the money from the temporary sales tax may not be spent on anything but four-lane highways. The I-30 project widens an existing freeway to 10 lanes. The Court ruling also specifically covered the already completed $90 million widening of Interstate 630 in Little Rock, an undetermined amount of which came from Amendment 91 money. Mays, who is a lawyer in a separate federal lawsuit over the I-30 project’s environmental impact, also notes that the state says it is using Amendment 91 for another widening of I-30 in Saline County.
In a Democrat-Gazette article following our report yesterday, a Metroplan official was quoted as saying loss of the state money didn’t mean the project his agency approved had to stop because there was no longer a reasonable expectation of financing. He said federal highway support, also part of the project, say such projects can continue if expected resources are reduced,
But that article and the Metroplan official didn’t explain — nor have highway officials — exactly HOW they can continue to pay contractors without money. A lot of money.
Mays notes that the price tag of the entire 30 Crossing Project is not $1 billion. The state’s most recent financial plan, issued in April said the entire project would cost $1.3224 billion over a 10-year span through 2035.
More than $400 million is now gone. And it’s not just gone, but money already spent from that fund on I-30, on I-630 and in Saline County will likely have to be repaid to the four-lane fund.
Mays notes this language in Amendment 91:
The Supreme Court’s decision did not address the requirement of Section 15 of Amendment 91 that, upon the complaint of a bond owner or a taxpayer, the Circuit Court of Pulaski County “shall, in any suit against the [Highway] commission, the Treasurer of State, or other officer or official of the state prevent a diversion of any funds pledged under this amendment and shall compel the restoration of diverted funds, by injunction or mandamus.”
The Supreme Court DOES like to follow the precise language of the law.
Some say there’s no problem because Issue 1, a new sales tax permanently devoted to streets and highways, was approved. They need to think more carefully about that.
First, that money doesn’t begin flowing until 2023, more than two years from now.
Second, of the roughly $300 million it will currently raise, one-third goes to cities and counties. The rest goes to the state, but not solely for the Interstate 30 project. Issue 1 was sold as a means to provide a stable source of money for maintenance of highways statewide. It is not only insufficient for paying for 30 Crossing, it would be a political disaster to pump all that money into Pulaski County.
Mays said: “ArDOT is facing demands to repay the Amendment 91 money it spent on the 30 Crossing and other interstate highway expansions it is conducting or has completed using Amendment 91 money, which could amount to hundreds of millions of dollars.”
Mays notes, too, that the financial plan was prepared while the state was re-evaluating the environmental assessment of the I-30 project, a process that started in early 2019.
He commented: “The record shows that ArDOT knew at that time or soon thereafter that it probably wouldn’t have the money to build the 30 Corridor project in one continuous project, but it didn’t make that public until the Re-Evaluation was filed in court on June 1, 2020 – over a year later. ArDOT and the State as a whole would have been much better off had ArDOT planned accordingly, instead of insisting that it could build the whole project in one continuous project for approximately $650 million.”
At some point, the state has to come clean. How will it repay the illegally spent money and how will it build I-30, both as to financing and form?
Mays continues his lawsuit to halt the project for deficiencies in the environmental assessment. So far, he’s found no favor with a chamber of commerce-friendly federal district judge in Little Rock, but the case will be appealed to the 8th Circuit. That court once adhered to a landmark ruling by the late federal Judge Richard Arnold on the National Environmental Policy Act and the importance of it being followed with full environmental impact statements (not done for I-30). But that was then and federal regulation is in less favor today.
If nothing else, the problem illustrates the wisdom of those who objected that Issue 1 put too much money in an unaccountable agency with a poor track record on decision-making.
Meanwhile, the freeway builders are still diverting traffic and ripping up right of way for the I-30 project as designed. Court action is needed to put a stop to it lest the state builds a billion-dollar-boondoggle fait accompli.