After just two hours of public testimony, a committee looking for solutions to Ohio’s highway funding gap found consensus on just one potential revenue source: raising the Ohio gas tax.
The panel didn’t get to the level of detail Wednesday afternoon of specifying how much the tax increase should be.
The Governor’s Advisory Committee on Transportation Infrastructure otherwise didn’t find agreement on other ways to raise money for Ohio’s road system, but additional sources of revenue could be added to a report being compiled on the group’s work.
Other ideas discussed included indexing the gas tax to construction inflation rates, assessing highway user fees on alternative-fuel vehicles, such as hybrid and electric cars, how and whether to control how local governments and the Ohio Department of Transportation use money for roads and whether Ohio needs more toll roads.
Ohio is running out of transportation funds because current 28-cents-a-gallon tax doesn’t buy as much as it did in 2005, the last time it increased. Money from Ohio Turnpike bonds has been spent or is committed to projects. Cars are more efficient and drivers buy less gas, paying less gas tax. And Ohio has borrowed against future gas revenues. All of this has created a funding gap.
The committee’s final report is being assembled by Brenton Temple, a staffer for Gov. Mike DeWine. DeWine has to get a transportation budget proposal to the legislature soon. The Ohio General Assembly needs to pass it by March 31. Temple’s report will come out sooner, and committee members were told to contact him with their ideas.
The committee met just Wednesday and Tuesday to learn about the reasons for and scope of the problem. On Wednesday, it took public testimony, and then discussed what recommendations will be made.
ODOT and Ohio Highway Patrol officials said Tuesday that doing nothing will potentially result in more accidents, injuries and deaths on Ohio’s roads. Ohioans currently spend $350 to $500 per vehicle a year on busted tires, vehicle alignments, windshields and other repairs that are the result of the state’s poorly maintained roads.
Indexing gas tax to inflation
Among the 15 committee members, there seemed to be general support for allowing the gas tax to increase with inflation, as the prices of construction and materials increase.
Committee member Nicole Busey, who works on tax compliance for Findlay-based Marathon Petroleum Company, noted that if Ohio’s gas tax were indexed, it would be the only tax that could increase with inflation.
Construction needs were estimated to be $1 billion for the Ohio Department of Transportation and $1 billion to $1.5 billion for local governments, said committee member Dean Ringle, executive director of the County Engineers Association of Ohio.
Alternative fuel fees
Although the revenue that electric, hybrid and alternative-fuel vehicles could create is modest, most people on the committee thought a fee was a good idea, since those cars contribute to the wear and tear on Ohio’s roads.
ODOT had estimated Ohio could generate about $2.5 million from a $250 electric vehicle fee and a $75 hybrid fee. Maryn Weimer of the Ohio Center for Automotive Research at Ohio State University said that would be higher than every other state.
Twenty-one states have hybrid vehicle fees, said AAA’s Kimberly Schwind, who serves on the committee.
Weimer said that people who drive those cars are concerned for the environment and no fee should be so high that it would punish them for their cars.
“The last thing we want to do is discourage that in this state,” she said.
Weimer also noted that plug-in vehicles aren’t free. Users pay for electricity. Other members of the committee suggested keeping Ohio’s fee in line with those charged in other states.
Committee member Marcus Hanna of Castellini Management, a Cincinnati-based food distribution company, said an alternative-fuel user fee wouldn’t capture revenue from nonresidents visiting in those cars.
He suggested the fee should be directed to the municipalities where the vehicles are registered, to help with their road fees.
No one who testified before the committee — except for a Liberty Township, Butler County, trustee — opposed a gas tax increase. But many public transit supporters asked the committee to better fund buses, rail and other modes of mass transportation.
William Tarter Jr. of the Cleveland Branch of the NAACP told the committee that Cuyahoga County — as well as the rest of the state — will have more senior citizens in coming years.
“As the state ages, seniors in rural and urban areas alike will drive less and rely on public transportation,” he said.
Doug Sibila, President/CEO of Canton trucking company Peoples Services Inc., asked Tarter: “Given that public transportation doesn’t pay any fuel tax or registration fees, what funding mechanism would you recommend?”
Tarver said he didn’t have a solution but knew that not addressing public transit will cost Ohio more in the long-run.
Joanna Pinkerton, CEO of the Central Ohio Transit Authority, said roads have to be maintained and made safe.
“I think the gas tax is necessary,” she said. “But the solution needs to be wider.”
She urged the committee to change its mentality from miles traveled to moving people and goods.
People use mass transit, ride share and drive to work. The gas tax is going to continue to be a diminishing source of highway funding in the future.