Practically everyone understood what Mike DeWine was saying about highways and the gas tax during the race for governor. In playing safe politically, the candidate said that if elected, he would form a commission to examine the need for additional revenue, weigh its findings and chart a path forward. He added that he was prepared to have a candid conversation with Ohioans. On Thursday, that moment for candor arrived. The governor proposed an increase in the state gas tax of 18 cents per gallon.
No newly elected governor wants to raise taxes as a first item. DeWine deserves credit for facing the truth about the need, or what the commission and others, including stakeholders and analysts have concluded. The state lacks sufficient revenue for its transportation priorities. Officials already postponed in this fiscal year $156 million in bridge maintenance projects. The inflationary cost of highway construction materials and labor has eroded the value of a $1 the past 14 years, the purchasing power 58 cents today.
As the governor told a forum on Tuesday, “The day of reckoning is finally here, and we have an obligation to face that.”
The governor’s predecessor, John Kasich, borrowed against toll revenue from the Ohio Turnpike. That helped for a time. Now the revenue stream has been tapped out. Might the state borrow to raise additional money? That has been the tendency in the past, to such an extent the state currently pays $390 million a year to service the debt.
So a higher gas tax is the preferable option. The additional 18 cents would be the first increase since 2005, when the state completed a 6-cent increase, implemented in phases during three years. The state tax would climb to 46 cents per gallon in all, comparable to Michigan (44.1 cents) and Indiana (42.9). Pennsylvania has set its rate at 58.7 cents, with West Virginia at 35.7 cents and Kentucky at 26 cents.
What would be the cost for Ohio drivers? The state Department of Transportation has calculated a range of scenarios. Roughly speaking, the expense would be $100 per year, the principle of a user fee at work. What would motorists receive in return? The increase would generate a projected $1.2 billion a year for highway construction and maintenance, with more than $400 million annually flowing to local governments.
For instance, the city of Akron would see its share grow in fiscal 2020 from the current estimate of $5.3 million to $9.2 million.
The transportation landscape of the state will be highlighted often in the debate, Ohio with the second-largest inventory of bridges, the third-largest freight volume, the fourth-largest interstate highway system (in miles). Transportation matters to the state economy and the quality of life, something apparent in Akron’s worn and potholed streets. In that way, the governor has added a helpful element, indexing the gas tax to inflation, reflecting a responsible long-term approach to public works.
No surprise many state lawmakers, Republicans and Democrats, have withheld judgment. They should take care to look closely at what the governor has proposed. If anything, public transit deserves additional resources, state general revenue funding for transportation down 42 percent in real dollars the past decade. What lawmakers also would do well to bear in mind is that the shortfall in money for highways, streets and bridges reflects the practice of short-term thinking at the Statehouse, resulting in a decade of disinvestment in other areas, too, including higher education and human services.
On one front, the governor now proposes to break that misguided pattern. In doing so, he has brought the overdue element of candor to the discussion.