Ohio, Va., Approve Fuel Tax Increase
Ohio is the latest state to raise its fuel tax to fund infrastructure needs, with the state legislature approving a 10.5¢-per-gallon increase on gasoline as of July 1. The state’s tax on diesel fuel will also rise by 19¢. State taxes on both fuels have been 28¢ per gallon since 2005.
Gov. Mike DeWine (R) originally requested raising the gas tax by 18¢, following an Ohio Dept. of Transportation report forecasting an annual funding gap for state and local transportation projects of as much as $2.5 billion. In addition to scaling back the increase, Ohio legislators also turned down the governor’s proposal for automatic fuel tax adjustments indexed to inflation.
The additional fuel tax revenue is expected to provide ODOT with an additional $524 million each year for road and bridge projects, while local governments will see their annual funding share increase by $341 million. “The real difference is not in the first year and the second year. The real difference you see between how we approach this is I was trying to get a fix for 10 years. Look, that may have been overly ambitious to try to do that; we’ve got a fix for a few years,” DeWine says.
In Virginia, legislators approved a $280-million funding plan from Gov. Ralph Northam (D) for upgrades to Interstate 81 and other congested traffic corridors. The plan calls for higher tractor-trailer registration fees and a 2% increase to the wholesale diesel fuel tax set to begin in mid-2021.
A local 2.1% fuel tax is authorized for the largely mountainous 325-mile Interstate 81 corridor, which will receive the bulk of the funding for new truck lanes and extended access ramps. Projects along I-64 and I-95 will also receive additional funding.
Representatives of the trucking industry favored the fuel-tax plan over a tolling proposal for I-81 that was rejected by state legislators earlier this year.