In The News

Iowa DOT says road funding shortfall is growing

CEDAR RAPIDS, Iowa — The state if facing a $267 million annual shortfall in revenue required to meet critical highway and bridge construction needs, Iowa Department of Transportation officials said in a report prepared for state lawmakers.

That number has grown since two years ago when the yearly shortfall was estimated to be about $200 million.

When the 83rd General Assembly convenes in mid-January and examines the revised projections, it could spark debate among lawmakers over raising the state’s gasoline tax.

Although Gov. Chet Culver has resisted raising that tax during the nation’s economic downturn, some lawmakers see it as the best option to improve the state roadways.

Deteriorating road conditions, the impact of severe weather, insufficient investment and a rise in construction costs were all cited in the DOT’s report as reasons why the gap between transportation needs and revenue has grown.

Current projections show that the yearly average revenue flowing into the road-use tax fund grew slightly to $1.99 billion. However, the cost of meeting the most critical pavement and bridge preservation for interstate, primary and local roadways increased to $2.26 billion since a 2006 study.

The DOT said that by 2012, the cumulative funding shortfall will have increased to more than $820 million, and by fiscal 2018 the cumulative shortfall is projected at about $1.5 billion.

In the report to lawmakers, DOT officials targeted out-of-state drivers saying they are not paying a proportional share of road-use tax fund revenue generated by state fuel taxes and commercial truck registration fees compared to the number of vehicle miles traveled on Iowa’s public roadways.

“Additional funding mechanisms not currently utilized in Iowa that could generate revenue from out-of-state drivers include severance tax on ethanol, sales tax on fuel, tolling and a per-mile tax,” the report said.

It lists options to generate additional transportation funds noting that each 1 cent increase in the state’s gasoline tax generates $21 million, each 1 cent increase in the state’s diesel fuel tax generates $6.5 million and repealing the ethanol tax credit would equal $6 million per year.

Kevin Jones of The Trucker staff can be reached for comment at [email protected].