RALEIGH, N.C. (AP) Lt. Gov. Beverly Perdue said Jan. 10 she would end the annual transfer of $170 million in highway funding to the state’s general operating fund if she’s elected governor.

The money would be better spent bankrolling $1 billion in road bonds and other transportation projects, Perdue said while unveiling the plan to Charlotte-area business leaders interested in transportation. She also discussed proposals to expedite highway construction projects and get a handle on increasing costs of construction materials.

She said stopping the funding transfer, which began in 1989, would help address an estimated $65 billion shortfall over the next two decades between transportation revenues and the state’s highway and public transportation needs.

“North Carolina’s transportation needs threaten our quality of life,” she said in a prepared statement. “As governor, I’ll transform the Department of Transportation and hold contractors accountable. North Carolina can become the ’Good Roads State’ again.”

Her leading Democratic opponent, State Treasurer Richard Moore, is skeptical of eliminating the transfer because it would create a hole in the state budget. It also would take debt capacity away from other needs such as school construction and water and sewer repairs, said Moore’s campaign manager, Jay Reiff.

The transfer began when the state Legislature created the Highway Trust Fund, used primarily to build urban loops, widen four-lane intrastate highways, and improve and maintain roads. Fund revenues are generated in part through vehicle and gasoline taxes and title fees.

The transfer was created to recoup the general operating fund for those taxes.

Perdue voted for the trust fund and transfer while serving in the House in 1989, but she now feels the practice must be phased out, said David Kochman, her campaign spokesman.

“Now we’re in a new century. The budget is very different from what it was” in the late 1980s, Kochman said.

The hole left by eliminating the transfer could be filled by surpluses created by revenue growth, as well as through proposed spending cuts. Those cuts could be recommended to the state Legislature by a special panel Perdue wants to create to examine waste and efficiencies in government, Kochman said.

Moore’s campaign, which laid out a transportation reform plan last week, said Perdue’s plan is short on details.

Moore would “support ending the transfer only if there is a real plan to hold the general fund harmless and not cut education, health care or public safety,” Reiff said. “So far, there’s not one on the table.”

Perdue also said she would attempt to reduce the rapidly increasing costs of asphalt and other oil-based materials. Kochman said material costs are going up everywhere, but not by the 20 percent jump that North Carolina has seen.

“It’s something else in the system, the way things are scheduled, the way things are planned and executed,” Kochman said. “We certainly know that inefficiencies at DOT … are a big part of it.”

Perdue also wants to hold regional DOT offices more accountable and allow them to work with local governments to get more jobs complete. She also wants to reward DOT contractors for completing work on time and punish those who are behind schedule.

DOT spokesman Ernie Seneca said companies already are penalized for missing deadlines, while the Board of Transportation sometimes approves contracts with extra money for those who finish work ahead of time.

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