By Jason Warner, GOPC Manager of Government Affairs

Governor Mike DeWine formally presented his budget recommendation to the Ohio legislature outlining his proposal for the state transportation budget on February 21. The budget must now be vetted and formally enacted by members of the Ohio House and Ohio Senate and approved by March 31. The new budget, once approved, will take effect on July 1.

Since the beginning of the year, much of the debate and discussion both within the administration and the Statehouse has been focused on the need for new revenue to invest in Ohio’s transportation infrastructure. ODOT Director Jack Marchbanks and repeatedly told lawmakers and the public that ODOT faces a $1.2 billion deficit in funding for a variety of reasons. Both ODOT and the recently formed Governor’s Advisory Committee on Transportation Infrastructure have made it known that the most immediate way to address this funding deficit is through an increase in the state motor fuel user fee (MFT) – something which has not happened since 2005 (when the current rate of 28 cents per gallon was set).

The Governor’s formal recommendation to the legislature is that lawmakers increase the MFT fee by 18 cents per gallon beginning July 1, 2019. It has further been recommended that the MFT fee be indexed to the consumer price index so that the rate automatically adjusts for inflation. The lack of indexing of the current rate has resulted in the value of the current MFT fee declining in real-dollar value (what was worth $1 in 2005 dollars today is only worth $0.58). While revenues from the MFT have remained steady, the cost of materials for basic infrastructure maintenance has increased since the last MFT increase, necessitating the proposed increase.

In addition to proposing to increase revenue for highway infrastructure, the budget proposal also includes a recommended increase in the amount of funding public transportation receives in the transportation budget. Since 2009, Ohio has “flexed” federal highway infrastructure funding it receives to a variety of other transportation-related projects, including public transportation. Flex funds are currently the largest single source of funds for public transit system in Ohio (apart from local revenue sources). Today, flex funding accounts for nearly 84% of all state funding that is provided to public transit, but only 3.58% of the overall budget for transit in Ohio.

Under the current budget, Ohio is flexing $33 million per year towards public transit. This funding is generally used for capital costs, ensuring that Ohio maintain, sustain and keep in good sound state our public transit systems. The proposal submitted today to the legislature would increase the amount of funding that is flexed to public transit to $40 million per year.

GOPC applauds ODOT and Governor DeWine for its continued commitment in making this funding available for public transportation. However, 32% of the public transit vehicles currently operating on the state’s roadways are estimated to be beyond their useful life and are in need of replacement. This also continues to fall short of the recommended funding from the Ohio Transit Needs Study, which in 2015 recommended that the state flex $50 million per year. That then was considered a short-term strategy and if adjusted for inflation would actually come in today at around $53.1 million.

That is why GOPC continues to recommend that the state double the amount of funds that are currently being flexed to public transit each year. Providing an additional $33 million per year ($66 million per year/$132 million per biennium) would provide the needed and crucial funding to help institute innovations that could increase services and reduce costs, as well as reduce the number of vehicles on the road that are beyond their useful life.

Should lawmakers follow the Governor’s recommendation to increase the state MFT, GOPC will continue to encourage lawmakers to simultaneously dedicate more federal flex funds towards public transportation. Increasing state MFT revenue will reduce the states dependency on federal highway infrastructure funding and allow Ohio to use that funding to invest in a robust and comprehensive public transit system that meets the needs of market demand and modern economic realities. Public transportation reduces congestion on our roadways while also reducing the wear and tear inflicted on our state roadways – a true win-win scenario for the state.

Check back for more updates and lawmakers continue to review the budget recommendations from the Governor and GOPC works for more investment in public transit throughout Ohio.