Federal stimulus package won’t erase PennDOT’s funding gap
Congressional leaders passed a new stimulus package meant to alleviate the financial pain of the coronavirus, but it won’t cure all that ails PennDOT’s pocketbook.
PennDOT press secretary Alexis Campbell said Monday afternoon it wasn’t clear if the relief plan will cover the $600 million funding gap plaguing PennDOT. Early media reports indicate that $10 billion of financial relief could be distributed to the 50 states’ highway systems, though it’s unclear how much would come Pennsylvania’s way.
State Sen. Pat Browne, a Lehigh County Republican and longtime chairperson of the Appropriations Committee, said Tuesday that transportation-specific wording included in the package will likely result in $350 million-$450 million coming to PennDOT.
“Weare monitoring the legislation and will review it if it passes. Additional federal investment in our transportation system would be welcome, but likely will not alleviate the need for the Legislature to work with us on a longterm funding solution relative to the revenue impacts of COVID19 at the beginning of the next legislative session,” Campbell said.
PennDOT was already facing a funding crisis when the pandemic crippled the economy. The 2013 gas-tax hike signed by Gov. Tom Corbett gave Pennsylvania the second-highest gas tax in the country, but legislators knew at the time it wouldn’t be enough to plug the projected $7.2 billion funding gap by 2020.
That financial stress has grown over the last nine months as people stayed home, driving down gas tax revenue. Campbell said Monday that 2020 gas tax revenue is $400 million below projections and will only get worse as the pandemic drags on.
“Currently we’re estimating that we’ll be down between $500 million and $600 million through June 2021,” she said.
Lawmakers were about to wrap up the 2021 budget at the start of this month when PennDOTofficials informed them the department needed $600 million to plug a funding gap. Legislators had known for years the department was in rough shape but were shocked to discover that unless funding materialized soon, hundreds of construction projects across the state would be halted. Legislators and Gov. Tom Wolf agreed to pass the budget and work out a temporary solution by borrowing money in January.
Even if the federal relief wipes away the short-term gap, it won’t do anything for the widening financial chasm long-term. PennDOT has begun investigating alternative funding sources, which would likely mean adding tolls to state-owned bridges and highways or instituting a vehicle miles traveled tax, a type of user fee that charges drivers for how much they drive instead of how much gas they burn.
PennDOT has not offered any detailed proposals at this point. Rep. Michael Schlossberg, D-Allentown, a member of the House’s Transportation Committee, said no formal proposals have reached lawmakers at this point.
The need for new state funding arises from declining federal infrastructure dollars. The federal government is supposed to cover 80% of highway funding, but the federal gas tax hasn’t increased in 27 years. Between inflation and improvements in fuel efficiency, the revenue isn’t enough to meet infrastructure needs as a result.
“While we’d certainly welcome additional federal dollars, that [stimulus proposal] doesn’t change the need to investigate sustainable alternative funding options that will support our network into the future,” Campbell said.