August 7, 2022

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Could Ohio pause new design? Gasoline tax income lags as motorists keep property in pandemic

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Ohio could hit the brakes on important new highway design due to the fact of decreased point out gasoline tax collections — yet another impact of the continuing COVID-19 pandemic.



a truck on a city street filled with lots of traffic: Traffic heads north on I-270 on the west side, as seen from Davidson Road bridge, during construction in April 2018. The Ohio Department of Transportation is recommending the state


© FRED SQUILLANTE, FRED SQUILLANTE
Site visitors heads north on I-270 on the west aspect, as viewed from Davidson Street bridge, throughout building in April 2018. The Ohio Division of Transportation is recommending the state “pause” applications for major new development funding mainly because gas-tax revenue has not satisfied anticipations all through the COVID-19 pandemic. [Fred Squillante/Dispatch]

Ohio Division of Transportation Director Jack Marchbanks proposed in his October finances proposal that the point out cease taking programs for important new initiatives in the state’s upcoming biennial spending plan due to the fact of lagging gas-tax receipts.

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Assignments now underway would continue on underneath ODOT’s two-year, $6.5 billion funds proposal.

That places Ohio in substantially the very same bind that it was in two decades back, when state lawmakers and Gov. Mike DeWine haggled about growing Ohio’s gas tax to aid bounce-begin new street building as profits from bonds issued against income on the turnpike ran dry.

The point out enhanced the fuel tax by 10.5 cents to 38.5 cents a gallon and the diesel tax by 19 cents to 47 cents a gallon.

Pandemic delayed road assignments

The enhance was predicted to make $550 million a year in extra resources for the condition and yet another $300 million for metropolitan areas, counties and townships. In 2019, the point out funded about $400 million in new design to broaden highway ability as element of a four-calendar year, $1.1 billion approach for major initiatives.

But plummeting site visitors volumes during the COVID-19 pandemic meant fewer people have been purchasing gasoline, Marchbanks pointed out in an October proposal to the state’s Office of Management and Spending budget.

Traffic cratered by virtually 50% in the early times of the pandemic past spring, and it completed the yr down by about 15.5%.

Slower site visitors volumes mean ODOT is projecting a profits reduction of about $174 million in the 2022 fiscal yr, which begins July 1, and $159 million in the 2023 fiscal year.

Final calendar year, it skipped income projections by $154 million and had to hold off the start out of new phases on two tasks: function on Interstate 70 on the south finish of Downtown Columbus and the most recent phase in the Millcreek Expressway job on I-74/75 in Hamilton County.

“This spending plan supplies for a modest sum of funding for further enhancements of the current highway community,” Marchbanks wrote. “The funding will be utilized to go on operate on projects that have presently commenced going forward, on the other hand, new growth venture programs are not getting regarded at this time.”

Proposal isn’t really final

An ODOT spokeswoman explained the department’s proposal is not closing and that DeWine’s business office could make adjustments before proposing a two-calendar year paying prepare to the Ohio Standard Assembly this year.

“This spending budget will however have to go by means of the legislative course of action,” mentioned Erica Hawkins, ODOT communications director.

New expansion tasks — the variety of construction that provides lanes or reconfigures interchanges to include freeway potential — typically choose the brunt of cuts when ODOT is shorter of funding mainly because the department prioritizes routine maintenance of the present freeway technique, she explained.

All those initiatives run by means of ODOT’s Transportation Overview Advisory Council to receive funding in an yearly application course of action. Hawkins explained that is “on pause” now, as it was right before the gas tax increase.

While Hawkins explained the raise has given the condition about $100 million it usually would not have experienced available, that is a fraction of what it projected dependent on pre-pandemic traffic. That funding could be applied for early stages on some assignments, these kinds of as suitable-of-way acquisition.

ODOT also has assignments in the pipeline if an predicted windfall in federal highway building funding comes to Ohio, Hawkins reported. Point out officers are not sure how significantly additional funding Ohio might acquire from the federal govt.

“We’re going to be viewing what transpires. We’re likely to be watching the profits,” Hawkins said. “If they start off to maximize a lot quicker than our projection, that’s an chance for us to go back again to the TRAC and say hey, we’re heading to be capable to fund yet another spherical.”

[email protected]

@RickRouan

This report originally appeared on The Columbus Dispatch: Could Ohio pause new design? Gasoline tax revenue lags as motorists remain dwelling in pandemic

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