Key Facts About Proposition 1


July 16, 2014


Proposition 1 on the statewide November ballot would direct a portion of the state’s oil and natural gas production tax collections to the State Highway Fund.  That would direct about $1.4 billion in additional funds to roads in 2015 and the amount is projected to increase annually over the next few years.

Key things you should know about Proposition 1 are:


Funds can only be used for new construction and preservation of the state highway system.


Funds CANNOT be used for toll roads.


It does not raise taxes, fees or debt on citizens or businesses.


It requires TxDOT to identify $100 million in savings (which the agency is already well on the way to achieving).


It begins to pay down the state’s highway project debt.


It will provide about a quarter of the $5 billion annual highway funding shortfall facing Texas.


It ensures that the Rainy Day Fund maintains a sufficient balance.


When voters go to the polls in November they will be asked to vote for or against the following: 


"The constitutional amendment providing for the use and dedication of certain money transferred to the state highway fund to assist in the completion of transportation construction, maintenance, and rehabilitation projects, not to include toll roads."


The amendment asks voter permission to place half of each year’s oil and natural gas production taxes in the State Highway Fund.   Those funds would otherwise go to the Rainy Day Fund (Economic Stabilization Fund) or to General Revenue.  Oil production in Texas is growing dramatically and huge natural gas fields have been discovered and will be developed in the years ahead as natural gas demand grows and prices improve. The passage of the Amendment will mean more funding for highways and strong revenues continuing to flow to the Economic Stabilization Fund.


New oil production levels in the South Texas Eagle Ford Shale play and in the Permian Basin are rising faster than even the most optimistic predictions. Crude production in April topped 3 million barrels per day -- the first time Texas has hit that mark since the 1970s. The oil production level this year is three times higher than it was in 2009. . 


Without voter approval of the Highway Funding Amendment (Prop. 1) total funding for new highway construction will decline dramatically over the next few years as borrowing and one-time funding sources are exhausted. The Amendment will provide a new funding stream and allow the Legislature to continue working on incremental measures that will fill the funding gap.