Ohio lawmakers consider hefty gas tax hike

Extra money would benefit ODOT, local municipalities

Graphic courtesy of Ohio Gov. Mike DeWine's Advisory Committee on Transportation Infrastructure Recommendation Report, February 2019. States surrounding Ohio vary in motor vehicle fuel taxes ranging from the lowest in Kentucky, 26 cents per gallon, to the highest in Pennsylvania with 58.7 cents per gallon. Currently, in West Virginia, the motor fuel tax, last raised in 2017, is higher than Ohio's, but if the proposed levy before Ohio legislators passes this month, Ohio will rise 11 cents above West Virginia.

It’s been 14 years since Ohio raised the rate of tax on motor fuel.

But in those 14 years, fuel efficiency, electric and hybrid cars, and rising costs of materials to maintain, repair and replace roads have widened the gap in funding for road infrastructure.

“We look at it as a user fee for the roads, because you’re taxing folks directly who are using those roads,” explained Washington County Engineer Roger Wright on Monday. “But as cars are getting more fuel efficient and people are switching to hybrids and electrics, they’re not paying that as much or as often.”

The current proposal sitting before Ohio legislators is a house bill to raise the rate of tax from 28 cents per gallon to 46 cents per gallon.

“That affects everybody, even people who don’t drive,” said Travis Wells, of Whipple as he filled up a tank for his employer, Morrison’s, on Monday. “I know it would affect the business since a lot of what we do is driving between places we service and someone will have to pay for that higher cost.”

Hearings today, Wednesday and Thursday are before the House Finance Committee on the fiscal year 2020-2021 transportation budget, House Bill 62 and the proposal to raise Ohio’s motor fuel tax by 18 cents.

The Ohio legislators have only the month of March to decide on the transportation budget, with a needed signature by the end of the month from Gov. Mike DeWine.

“Then it needs to sit for 90 days to be in effect with our new fiscal year on July 1,” said Matt Bruning, press secretary for the Ohio Department of Transportation central office in Columbus. “The big thing with this increase though is in the past ODOT has been able to benefit from the tax increases, but local governments didn’t see that. Now here’s a case of a rising tide raising all boats and townships, cities and villages will all see an increase. So typically more rural townships, like Fairfield Township in Washington County won’t be left behind.”

Wells said he also sees why the state is looking to increase their revenue to fix roads, as he has watched a slip out of Stanleyville Lane between Marietta and Whipple get worse over the last year.

“We need good roads to do anything, so that makes sense, but how much is enough?” he asked, noting he frequents Cincinnati and Columbus multiple times a year and even makes annual trips to Cedar Point and down to Florida. “Usually it’s cheaper to drive based on costs of flights, I wonder if it still will be.”

Bruning explained that there are already minimum allocations coming from the current fuel tax revenues to townships, villages and cities–based on the numbers of vehicles registered within the boundaries of each and the number of center-lane miles each township possesses.

“Right now if the tax levy doesn’t pass no township will get less than $90,475 for their roads in the next fiscal year,” he said. “But that goes up to $151,989 at a minimum if this is passed and increases up to a minimum of $163,953 by 2024–it’s a pretty hefty bump.”

Each county also gets an even distribution, and Wright said the bump would help close two gaps in funding he faces annually.

“Washington County has about 320 miles of hard surface road to maintain, but with the current budget I have I can maintain on a 20-year life cycle only about 200 miles,” he explained. “That leaves 120 miles of unfunded need when the cost per mile per inch of asphalt is $70,000.”

Plus with the costs to maintain bridges no longer covered by sales tax allocations, he said, the tax could extend the lifespans of county bridges.

“We used to see $1.5 million to $2 million a year from sales tax allocation for our bridges, now I get about $300,000 from that for bridges. We did replace some of that loss with a license plate fee which brings in about $500,000 each year–but I’m still behind by at least a half million dollars each year,” said Wright.

The last time the motor fuel tax was raised was in 2005, according to the Greater Ohio Policy Center, when the Ohio legislature increased the rate by 2 cents per gallon from 26 cents per gallon to the current 28 cents per gallon.

In West Virginia the most recent motor fuel tax increase took effect in 2017, raising the rate 3.5 cents from 32.2 cents per gallon to 35.7 cents per gallon.

If Ohio legislators were to pass the increase in March, Pennsylvania would still keep the highest motor fuel tax rate of states bordering Ohio. It was installed in 2014 at 58.7 cents per gallon, an increase of 36 cents from the previous 26.4 cents per gallon.

The Ohio Municipal League, County Commissioners Association of Ohio and the Ohio Township Association have all released positions in support of the tax increase in the last week.

By the numbers:

• The Ohio Legislature is considering raising the state gas tax from 28 cents per gallon to 46 cents per gallon.

• If passed by both the Ohio House of Representatives and the Ohio Senate, Ohio Gov. Mike DeWine must sign the bill by the end of March for the tax increase to take effect July 1.

• If passed, gas tax revenues would be split, with 60 percent going to the Ohio Department of Transportation and 40 percent to local governments.

Estimated allocations:

• Washington County Engineer:

• Current fiscal year 2020 (beginning July 1, 2019) allocation: $2,436,948.

• With proposed increase in 2020: $4,209,867.

• With proposed increase in 2024: $4,535,823.

• Marietta City:

• Current fiscal year 2020 (beginning July 1, 2019) allocation: $466,947.

• With proposed increase in 2020: $806,510.

• With proposed increase in 2024: $868,506.

• Belpre City:

• Current fiscal year 2020 (beginning July 1, 2019) allocation: $258,439.

• With proposed increase in 2020: $446,375.

• With proposed increase in 2024: $480,687.

• Beverly Village:

• Current fiscal year 2020 (beginning July 1, 2019) allocation: $41,210.

• With proposed increase in 2020: $71,179.

• With proposed increase in 2024: $76,650.

• Lowell Village:

• Current fiscal year 2020 (beginning July 1, 2019) allocation: $21,315.

• With proposed increase in 2020: $36,814.

• With proposed increase in 2024: $39,644.

• Lower Salem Village:

• Current fiscal year 2020 (beginning July 1, 2019) allocation: $2,214.

• With proposed increase in 2020: $3,825.

• With proposed increase in 2024: $4,119.

• Macksburg Village:

• Current fiscal year 2020 (beginning July 1, 2019) allocation: $7,578.

• With proposed increase in 2020: $13,088.

• With proposed increase in 2024: $14,094.

• Matamoras Village:

• Current fiscal year 2020 (beginning July 1, 2019) allocation: $26,124.

• With proposed increase in 2020: $45,122.

• With proposed increase in 2024: $48,590.

• Muskingum Township:

• Current fiscal year 2020 (beginning July 1, 2019) allocation: $93,666.

• With proposed increase in 2020: $160,030.

• With proposed increase in 2024: $172,636.

• Warren Township:

• Current fiscal year 2020 (beginning July 1, 2019) allocation: $98,201.

• With proposed increase in 2020: $171,459.

• With proposed increase in 2024: $184,979.

• Adams, Aurelius, Barlow, Belpre, Decatur, Dunham, Fairfield, Grandview, Independence, Lawrence, Liberty, Ludlow, Marietta, Newport, Palmer, Salem, Waterford, Watertown and Wesley townships (same base allocation for each):

• Current fiscal year 2020 (beginning July 1, 2019) allocation: $90,475.

• With proposed increase in 2020: $151,989.

• With proposed increase in 2024: $163,953.

Sources: Ohio Municipal League and Ohio Department of Transportation.

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