The Nutmeg Toll
A proposal to levy fees on highway drivers is the latest example of Connecticut's appetite for tax revenue.
Ryan Fazio
Economy, finance, and budgets
Supported by 2018's Blue Wave, Connecticut Democrats retained the governorship and large majorities in the state legislature. The national trend seems like the only explanation for their electoral success, considering the state's dismal economic performance and chronic fiscal crisis during the prior eight years of unitary Democratic governance. After signing two of the largest tax hikes in state history, Dannel Malloy left office as the second-most unpopular governor in the nation. Even with the second-highest tax burden of any state, Connecticut has the second-highest unfunded pension liability in the U.S. The state economy remains smaller than before the financial crisis.
Democratic candidates for state office ran against President Trump and away from their own records. New governor Ned Lamont, though hardly a fresh face, campaigned with the slogan "the change starts now." Democrats won state senate upsets in traditional Republican strongholds like Greenwich and Wilton, with candidates promising to be "a different kind of Democrat" or a "fiscal moderate." The incumbent party won an ironic mandate for change.
As they push billions in new taxes, fees, and spending, though, newly inaugurated Democrats are hard to distinguish from their predecessors—and a proposal to impose highway tolls for the first time since 1985 has inspired widespread protest from a typically passive electorate. Lamont wants to raise $800 million annually with road tolls, constituting a 4 percent increase in state government revenue and about a 50 percent increase in transportation revenue. Breaking his campaign promise with haste, the governor would toll cars and trucks on four highways, with, he says, a maximum of 50 transponder-fitted overhead gantries to collect the fees. He claims that 30 to 40 percent of the revenue will be collected from out-of-state drivers, which is almost certainly impossible, and fund vital infrastructure needs. Even so, a resident commuting 250 weekdays per year between New Haven and Hartford would now have to pay an additional $860 for the privilege.
No Tolls Connecticut, a grassroots group started by a firefighter and small businessman named Patrick Sasser, has rallied significant opposition to the plan. A petition against tolls has acquired over 90,000 signatures, one of the biggest responses in Connecticut history. Eighteen municipal legislatures have taken the unusual step of passing resolutions against tolls, including the overwhelmingly Democratic Board of Representatives of the state's economic capital, Stamford.
A Sacred Heart University poll shows 59 percent of Nutmeggers oppose tolls, compared with 35 percent in support. Republicans rode the tolling issue to two special-election wins in February, in a state senate district that Hillary Clinton carried by 23 points and a state assembly district represented by Democrats for more than 30 years. Supporters argue that tolls are simply user fees, commensurate with the service provided, but Connecticut already imposes six other classes of taxes and fees on its residents to finance 98 percent of its Special Transportation Fund (STF), including the seventh-highest gas tax in the nation. STF revenue swelled 372 percent since the state eliminated tolls in 1985, according to the Office of Fiscal Analysis. If roads and bridges are underfunded, as Democrats claim, it's because public transportation spending—up by 589 percent in the same period—is crowding them out. The public has been paying for its roads with higher taxes for 30 years.
Drivers might be more forgiving of tolls if they had any confidence that their money would be spent well. It never has been. While much of the bloated public transportation budget got spent on boondoggles like the New Britain "Busway to Nowhere," service on the vital Metro North New Haven Line between New York and New Haven has gotten slower and spottier. The highways are also in relatively poor condition, though not for lack of funding. Connecticut spends the sixth-most per highway mile of any state (about $500,000) and the most per mile in administrative costs (about $100,000), according to the Reason Foundation. But economizing is never an option in Hartford.
The tolling proposal is the latest burden put on Connecticut workers and families struggling to get by in a stagnant state economy. It comes on top of an average additional $1,100 in annual taxes for every worker, proposed by Governor Lamont—which, in turn, comes on top of an average of roughly $1,600 in higher taxes per worker, $2.7 billion in total, instituted by his predecessor Malloy, whom Lamont took pains to distinguish himself from during the campaign. There is no end in sight to the tax-and-spend cycle in a state that has failed to confront a $68 billion unfunded pension liability for its government employees, who are compensated about 40 percent more than similar private-sector workers.
The corruption and dysfunction of Connecticut's deep-blue politics now threaten the prosperity and tranquility of the state's communities. Recent evidence suggests that the public is beginning to realize that the same old policies will fail to fix the state's fiscal crisis. If tolling gantries go up on Connecticut's highways, they will stand as monuments to profligate governance.
Ryan Fazio works in commodities markets and lives in Connecticut. He tweets @ryanfazio.
Photo: carminesalvatore/iStock
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