The Missouri Highways and Transportation Commission can give employees big raises to cut job turnover and attract new workers, a Cole County judge ruled Tuesday.
In a long-awaited decision, Circuit Judge Cotton Walker decided that the commission’s plan for a “market adjustment” is authorized by constitutional language controlling the State Road Fund. In his ruling, Walker said the commission is not bound by the amounts listed in state appropriation bills when deciding how to spend the money collected from fuel taxes and vehicle registration fees.
Commissioner of Administration Ken Zellers must allow payments approved by the Highways and Transportation Commission, Walker wrote, “when the request is for a constitutionally authorized purpose and there is sufficient balance in the State Road Fund.”
The case began in late 2021 when Zellers refused to allow the highways commission to implement a pay raise plan that carried a price tag of $60 million. The highways commission wanted to stem turnover at MoDOT and attract new employees.
During fiscal 2021, budget documents show, the department lost an average of 34 employees a month to resignations and another 16 per month from retirements. In fiscal 2022, after the pay plan was rejected, turnover increased to 52 resignations and 20 retirements per month.
General state raises have added almost 17% to paychecks in MoDOT and other agencies since the lawsuit was filed. Turnover fell in fiscal 2023 to 14% but remains above the rate seen in earlier years.
The commission’s goal for the pay plan was to raise pay levels so 65% of MoDOT employees are at or above the midpoint in the pay range for their job. In the fiscal year that ended June 30, 89.4% were below the midpoint, according to state budget documents.
Jim Layton, an attorney who represented the highways commission, declined to comment on the ruling. He noted that the judgment is subject to appeal and therefore not final.
The attorney general’s office, which represented Zellers, has the ruling under review, spokeswoman Madeline Sieren wrote in an email.
The highways commission filed the lawsuit to test constitutional language that is unique to the road fund. The Missouri Constitution states that the money deposited in the fund shall “stand appropriated without legislative action.”
The case was argued in February 2022 but the decision was delayed while Walker waited for the Missouri Supreme Court to rule on a similar case involving the Conservation Commission. In that case, the court ruled lawmakers had authority to set spending levels from the state conservation fund but could not limit the Conservation Commission’s use of appropriated money for authorized purposes such as land acquisition.
In his ruling and in a hearing in early October, Walker said he delayed a ruling in the highways commission case while the conservation case was pending. The conservation case provided the answer for the highways case, he wrote.
In that case, he noted, the attorney general’s office argued that the “stands appropriated” language for the road fund means no appropriation is necessary for the highways commission to use the money. But in the highways case, he wrote, the attorney general’s office argued the opposite – that the “stands appropriated” provision is overridden by another section that means no state funds can be spent without a legislatively approved appropriation bill.
The requirement of the provision cited by the attorney general’s office, that no money can be spent except through an “appropriation made by law” is satisfied by the “stands appropriated” language, Walker wrote.
“The Constitution is a ‘law’ sufficient to meet the requirements … that the commissioner has before him ‘an appropriation made by law,’” Walker wrote.
The lawsuit was filed two months after the first state fuel tax increase in 27 years took effect. State lawmakers approved the tax increase – 12.5 cents per gallon phased in over five years – without seeking a statewide vote.
So far, the tax increase has added 7.5 cents a gallon to the cost of fuel and when fully implemented on July 1, 2025, motorists will be paying a total of 29.9 cents per gallon in state fuel taxes.
The lawsuit enraged some lawmakers. State Sen. Cindy O’Laughlin, and five other Republican senators, in a February 2022 letter to the commission, demanded that MoDOT Director Patrick McKenna either resign or be fired.
“Regardless of the legality of this move, it is a gross violation of the public’s trust and a setback that the department and the state’s road system cannot afford,” the letter stated.
McKenna is still in his job and lawmakers have continued to provide other money to supplement the road fund, including a massive $2.8 billion plan to improve Interstate 70 that required $1.4 billion of general revenue.
O’Laughlin, who now serves as Senate Majority Leader, said she is still mad and still wants McKenna to be ousted.
“The public will see this as one more instance of a tax that was passed to help upgrade the roads and they are going to do something different with it,” O’Laughlin said Wednesday.
Residents of north Missouri view MoDOT “very negatively,” she said. They feel their roads are neglected even with the additional tax.
“People don’t mind paying for what they know they will get but they do mind paying for something they are fairly certain they won’t get,” she said.
A House critic of the raises, state Rep. Don Mayhew, R-Crocker, said Wednesday that in the upcoming legislative session he will file a bill to revise the highway commission’s power over the road fund.
Mayhew chairs the House Committee on Transportation Oversight and the Joint Committee on Transportation Oversight.
“It falls out of the original intent of the constitution, the checks and balances that were built into the constitution since our founding,” Mayhew said.
He doesn’t disagree with the market adjustment plan, Mayhew said, but believes it should be subject to legislative approval. One area where the department has a chronic shortage is snow plow drivers to clear highways in winter.
KOMU-TV in Columbia reported last month that the department was hundreds of plow operators short of full staffing. A mild winter last year did not make the shortage of 900 drivers apparent to the public, the station reported.
MoDOT has to be competitive with the market to fill those jobs, Mayhew said.
“If truck drivers are costing $40 an hour and you are paying $26 an hour,” he said, “you are not going to get many truck drivers.”
