“I actually have a slide in my town hall presentation that shows why money is diverted from the Highway Fund and where it goes,” State Rep. Susan Lynn (R-Mt. Juliet) told a constituent in an email, confirming The Tennessee Star’s report that Highway Fund user fees are being allocated to the General Fund, Education and Debt Service.
The constituent had forwarded a link to The Star’s report on Wednesday that “The Highway Fund receives road construction “user fee” revenues from gasoline tax, motor fuel tax, gasoline inspection tax, motor vehicle registration tax and the motor vehicle title fees. At least 25 percent of those road construction “user fees” go to the General Fund, Education and Debt Service.”
In the email reply to her constituent, Rep. Lynn copied every member of the Tennessee General Assembly in both the House and Senate, ensuring that they have knowledge of the “diversion” of user fees from the Highway Fund.
You can read the first part of Lynn’s reply to her constituent here:
I actually have a slide in my town hall presentation that shows why money is diverted from the Highway Fund and where it goes. Each amount makes perfect sense. Please see my slide below with the explanations. The money in the General Fund column goes to the Department of Revenue, Dept of Agriculture, various charities and to the Dept of Education. 1. Completely in line with the “User Fee” concept, the Department of Revenue collects all taxes – by law – Revenue is allowed to recoup their expenses for collection and accounting from the amount of tax collected but only up to 2% of the amount collected for the tax. Revenue’s expenses for the collection and accounting rarely equal 2% as you will see below. Also, some of the gasoline inspection tax that is in the General Fund is spent by the department of agriculture – it is for lab test fees for testing the gasoline samples collected under this program.
In addition, the motor vehicle registration tax that is in the General Fund includes the money for the charitable specialty license plates – Revenue sends the various charities that sponsored a specialty plate a check and money also goes to the Dept of Education because they have a specialty plate too (the education money mentioned in the article). The money in the Debt Services Fund column is an accounting necessity of GASB – a reserve – this money is never spent but must be reserved in case the state falls short and cannot meet the obligation of all of the outstanding TDOT contracts.
The money in the cities and counties column is their share of the collected taxes. Please see each note below in the last column to read what each diversion is for – you will see that each amount makes perfect sense.
Rep. Lynn’s slide (or chart), which she referenced in her email, can be seen in the headline image of this story. You can find a picture of the same slide in a March 1 Facebook post by Rep. Lynn.
Though Rep. Lynn’s slide does not specify a source or a fiscal year, it appears to be taken from the estimated budget for the state of Tennessee for the Fiscal Year 2017-18 which you can link to here.
The chart prepared by The Star in Table 1 of our story published on Tuesday shows that the total Highway Fund “user fees” that are diverted to the General Fund, Education, and Debt Service for FY 2017-18 is $187,100,000, as detailed on page 99 (also numbered A-67) of the Tennessee budget document for that year.
Rep. Lynn’s slide shows that a total of $163,200,000 in total Highway Fund user fees are diverted to the General Fund, Education, and Debt Service, as follows:
Gasoline tax – $11.1 million diverted to the General Fund and $83.8 million diverted to Education
Motor Fuel tax-$2.5 million diverted to the General Fund
Gasoline Inspection tax – $20 million diverted to the General Fund
Motor Vehicle Registration tax -$45.6 million diverted to the General Fund
Total = $163.2 million
However, Rep. Lynn’s chart fails to include the additional $23,900,000 in Motor Vehicle Title Fee revenues (another Highway Fund user fee) which are diverted to the General Fund, Education, and Debt Service, which is detailed on page 99 (also numbered A-67) of the Tennessee budget document for that year.
When the $163,200,000 in Highway Fund user fee “diversions” outlined in Rep. Lynn’s slide are added to the $23,900,000 in motor vehicle fees omitted in her slide, the combined total equals $187,100,000, the accurate total reported by The Star.
The Star also accurately reported that this $187,100,000 of Highway Fund user fees diverted to the General Fund, Education, and Debt Service is 26 percent of the Highway Fund of $716.2 million.
Importantly, all revenue and allocation references exclude the amounts allocated to cities and counties.
Rep. Lynn ended her email to her constituent with this:
I hope you do not mind but I have copied every member of the House and Senate so that they can see this “Fake News” explanation too. I also saw some article on there about a kid who says he is going to run against me because I am for raising the gas tax which I am not – the article completely cuts off the other half of my quote which favors the Hawk plan. The kid was a troubled youth who has since changed his name. He even worked for my Democrat opponent in the last election.
While Rep. Lynn states in this email she “favors the Hawk plan,” her Facebook post on February 28 at 5:29 pm regarding her neutral presentation of the two plans to address Tennessee’s infrastructure needs at her town halls states, “That is because I am not endorsing either bill.”