Ohio is often thought of as the crossroad to North America as it is just a day’s drive from 60 percent of the U.S. and Canadian populations. Ohio has the fourth largest interstate system in the country, second largest inventory of bridges and sixth highest number of vehicle miles traveled. Unfortunately, the revenue to maintain, improve and expand our state’s transportation system is not keeping up with the state’s needs.

Knowing that Ohio’s transportation budget would be one of the first major issues to tackle, Gov. DeWine created a Governor’s Advisory Committee on Transportation Infrastructure to study the current conditions of our state’s roadways and recommend options for continued maintenance and expansion. Several Ohio Chamber member companies are on this advisory committee including the Ohio Oil & Gas Association, Marathon Petroleum Company LP, Honda and AAA . The group met on February 5 and 6 to hear from the Director of the Ohio Department of Transportation Jack Marchbanks and Colonel Paul Pride with the Ohio State Highway Patrol as well as other interested parties.

In his presentation to the group Dir. Marchbanks painted a dire picture of the state’s lack of infrastructure funding as beginning July 1, 2019, there will be no new revenue for improvement projects. “We cannot maintain the system that we have, let alone improve upon it,” he stated due to what he termed a “perfect storm” of adverse fiscal developments and past spending.

To fund roadway maintenance and expansion, Ohio uses a gas tax. The last gas tax increase was passed in 2003 which enabled the tax to increase two cents every year for three years bringing the state’s total gas tax to 28 cents per gallon which is where it stands today. Ohio’s gas tax is split among state and local governments 60 to 40 percent respectively. The tax is not indexed so it does not increase with inflation however, construction costs have increased. A dollar in 2003 buys just 58 cents of construction work in 2018.

Also, Ohio’s gas tax revenue has remained flat due to increased fuel efficiency. While motorists are driving more, adding wear and tear to bridges and roadways, the amount of gas they are buying has remained flat. In 2003 it was estimated that there would be a one percent increase in fuel purchased each year however fuel purchases have only increased one third of one percent.

In order to raise additional funding, the previous administration sold bonds against future Ohio Turnpike revenues in 2013 and again in 2018 to the tune of $1.5 billion. This money was used for improvements not only on the turnpike, but also on roadways within 75 miles of the turnpike. This money has been exhausted and now must be paid back.

While Dir. Marchbanks did not make any recommendations to the advisory committee, he did inform them that a one cent increase in the state’s fuel tax would bring in $67 million a year. Also adding registration fees on electric or hybrid vehicles would generate only about $2.5 million a year.

As the committee continues to look at this issue, it should also be noted that improving our country’s infrastructure on a national level is also under consideration. An increase in fuel taxes at federal level could be in play. While Ohio’s transportation budget has to be approved by the end of March, there is no similar timeline at the federal level and no clear indication that Congress will actually tackle this issue.

The Ohio Chamber supports efforts to ensure adequate and reliable funding for Ohio’s transportation system and will carefully consider the recommendations of the Governor’s Advisory Committee on Transportation Infrastructure. Those recommendations are likely to be reflected in Gov. DeWine’s transportation budget that is expected to be unveiled within the next week.

UPDATE FEBRUARY 18: The governor’s Advisory Committee on Transportation Infrastructure released it’s report on Friday, February 15. Though they did recommend an increase in the gas tax, however they did not recommend an amount. The report can be found here.