Nebraska counties and midsize cities are expected to receive an extra $3 million each year for street and bridge work under changes unveiled Tuesday by Gov. Pete Ricketts.
Ricketts said the state will increase the money it gives to cities and counties through a program that allows them to swap federal dollars for state money to complete local projects. Using state money allows them to finish work faster and with fewer restrictions.
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"Twenty-first century infrastructure is critical for us to be able to grow Nebraska," Ricketts said at a press conference at the Capitol.
The state has traditionally taken 20 cents of every dollar that cities and counties receive in exchange for the service. Ricketts said the state will reduce that fee to 10 cents per dollar, allowing the local governments to keep more. Ricketts has focused on efficiency in government as a major theme of his early tenure in office.
Nebraska's new Department of Roads director, Kyle Schneweis, said the state can absorb the revenue loss because of a new agreement with the federal government to reduce engineering and construction costs. The U.S. Federal Highway Administration has agreed to reduce the number of times state officials have to seek environmental approval at various stages of a construction project, making the work faster and cheaper.
"Those (time) savings translate into dollars, and we're happy to pass those dollars on to our local partners," Schneweis said.
Lynn Rex, executive director of the League of Nebraska Municipalities, said the extra money will ease pressure on local property taxes. All 93 Nebraska counties participate in the program, as do 25 midsize cities with populations between 5,000 and 100,000.
Larry Dix, executive director of the Nebraska Association of County Officials, said the change represents another important step in the push to address a backlog of necessary upgrades. In a report last year, the Department of Roads identified $10.2 billion in projects it says are needed during the next 20 years.
The change will save Sarpy County an estimated $90,000 on one project alone. Sarpy County Engineer Dennis Wilson said the county has been saving money to upgrade 168th street, a gravel road with a county bridge just east of the fast-growing Omaha suburb of Gretna.
Nebraska has historically relied on fuel-tax revenue, motor vehicle fees and federal dollars to pay for roads projects, but revenue from the state sources have flat-lined in recent years as cars and trucks became more fuel efficient.
Nebraska lawmakers voted in May to raise the state's fuel tax by 6 cents per gallon, overriding the governor's veto. The higher tax will generate an additional $76 million annually for roads and bridges when fully enacted, to be divided among the state, counties and cities.
Members of the Legislature's Transportation and Telecommunications Committee also have announced plans to hold a series of hearings this fall for input on new ways to pay for roads.
Another major law, the 2011 Build Nebraska Act, sets aside one-quarter of a cent from the state's 5.5-cent sales tax for roads projects.
Nebraska has more than 100,000 miles of roads and 20,000 bridges, mostly owned by counties and cities. Roughly 10,000 miles of road and 3,500 bridges belong to the state.