Arkansas’ Continued Use of GARVEE Bonds for Interstate Rehabilitation

1. Arkansas’ Continued Use of GARVEE Bonds for Interstate Rehabilitation

2. Interstate Condition - 1999 16% Fair Good 21% Poor 63% • Arkansas first to complete Original Interstate Mileage • Original Interstate designed for 56,280 pounds and 10-20% trucks • Current weight limit is 80,000 pounds • Trucks now account for 60% of total traffic on some sections • Increases in freight movement • 63% of the Interstate considered Poor • Pay-as-you-go not sufficient

3. 1999 Interstate Rehabilitation Program • $575 million in bonds • Improved over 50% of our Interstate system • Approved by voters 4:1 • Bonds repaid with: • Federal Interstate Maintenance funds • Existing 4-cent diesel tax • Other Federal-aid and State match used for bridges, widening, etc.

5. 1999 Interstate Rehabilitation Program Awards

6. Existing 4-cent Diesel Tax from the 1999 Interstate Rehabilitation Program • Revenue Distributed 70%-15%-15% • AHTD’s Portion Dedicated to Repay Bonds • City and County Use of Funds is Flexible • Currently Generates $23.8 Million Annually Statewide AHTD (70% -Bonds)

7. Arkansas’ Continued Use of GARVEE Bonds for Interstate Rehabilitation • The Arkansas Highway Financing Act of 2011 • Voter Approval Required • Extends Authority to Issue Bonds for Interstate Rehabilitation • Program is for INTERSTATES ONLY • Maximum Amount of Bond Debt Remains $575 Million • NO NEW TAXES – Will use Existing Revenue Stream • Remaining Bonds have been Refinanced – New Bonds could be Issued in 2012 or 2013 • All Bonds must be Issued by December 31, 2015

8. Anticipated Election Schedule November 8, 2011 • Election called by the Governor • Extension of GARVEE Bonds • NO NEW TAXES November 6, 2012 • General Election • ½ cent Temporary Sales Tax • Issue Bonds

9. Impact of the Continued Use of GARVEE Bonds for Interstate Rehabilitation • Continuation of Improvements to the Interstate Highway System • Safer, Smoother Interstate Travel • Cost Savings of $350/Year for Average Driver • Lower Vehicle Operating Costs • Improved Fuel Efficiency • Economic Benefits • 27,500 Jobs Supported

10. Without Continuation of GARVEE Bonds • Funds used to improve other highways may have to be redirected to Interstates • Redirection of funds could lead to significant deterioration off the Interstate

11. INTERSTATE CONDITION

12. 2011 GARVEE Bond Proposal • Continuation of Existing Bond Authority • NO NEW TAXES! • Cities and Counties Continue to Share • Limited to Interstates Only – Approximately 4% of all Highway Miles • Maximum Bond Debt Remains $575 million • Short Maturity Bonds – 10 to 12 years • Estimated $1 Billion in Construction

14. Summary • 1999 Interstate Rehabilitation Program • Arkansas’ Interstates went from Worst to among the Best in the Nation • Needs Still Exist • The 2011 Interstate Bond Proposal would: • Maintain Progress Made on Our Interstates • Improve Additional Mileage • Allow for Better Planning • Increase Safety and Efficiency • Counter the Impacts of Inflation • Boost Economic Activity • Retain and Create Jobs