Massachusetts law authorizes borrowing for local road, bridge work
July 27, 2020
A new law in Massachusetts will provide an increase in investment for local road and bridge projects.
Gov. Charlie Baker signed into law the bill to authorize the state to borrow $200 million for improvements to municipal-owned roads and bridges. The funds authorized via H4803 will be dispersed through Chapter 90 grants.
The grants are sent to towns and cities in Massachusetts to receive reimbursements on approved projects. It is a 100% reimbursable program.
“I’m proud to see the legislature continue to invest in important local infrastructure,” Rep. Joan Meschino, D-Hull, said in prepared remarks. “These funds are critical for every city and town across the commonwealth.”
The amount is the same as what the state-approved one year ago. As introduced, the bill called for making available $300 million in bonds.
Failed fuel tax increase
House lawmakers wanted to raise the state’s 24-cent fuel tax to cover some of the proposed $300 million in borrowing.
Specifically, the legislation called for increasing the gas tax by 5 cents to 29 cents. The diesel rate would have been raised 9 cents to 33 cents.
The state’s existing excise tax raises about $770 million annually.
Revenue estimates show the gas tax increase would raise another $175 million per year. The diesel increase would raise another $32 million.
Citing concerns about coronavirus and less tax revenue, legislators chose to back off the tax increase proposal.
In the end, legislators again agreed to the $200 million bonding amount.