Kentucky's road fund expected to remain flat as the need to repair roads and bridges increases
FRANKFORT, Ky. (WDRB) -- Kentucky lawmakers heard good news and bad news Monday about Kentucky's road fund.
The fund brought in $1.511 billion in the fiscal year that ended in June, beating estimates of $1.503 billion. But the bad news is that that figure is nearly $50 million less than was collected four years ago, and no significant growth is expected.
Roughly 25 cents of every gallon of gas consumers buy goes to into the road fund to build and repair Kentucky's roads and bridges. The complex formula used to calculate the tax is based on the price of gasoline.
The gas tax hit record highs four years ago, when prices soared, but has since dropped by 6 cents a gallon.
Robin Brewer, budget director for the Kentucky Transportation Cabinet, said revenue is expected to remain flat for at least the next two years.
“We're not anticipating any more growth," Brewer told members of the Interim Transportation Committee. "We’re not seeing any more growth."
While revenue remains flat, the cabinet said construction costs continue to rise. The combination could result in a bumpy ride for motorists.
“How long can we sustain the status quo before we start seeing a negative impact on our infrastructure?” asked Rep. Ken Upchurch, the House Transportation Committee chairman.
“The short answer on that is we’re probably not far away,” responded Deputy Transportation Secretary Paul Looney.
Looney said the need for repairs gets even more urgent as roads and bridges continue to age.
“It's not allowing us to be as proactive as we would like to be, and so what that causes is sometimes when you defer maintenance, it costs more in the future,” he said.
To make matters worse, a federal tax credit the state currently receives will soon expire.
“If we let this thing go for the next five years, we’re really going to be in a mess,” Upchurch said.
A bill that would have raised the gas tax by 10 cents a gallon went nowhere in the last legislative session.
Upchurch said the gas tax may become part of a larger tax reform package, but right now there is no concrete plan.
“We're just staying on top of things, but it’s starting to have a snowball effect,” he said. “We’re going to have to do something. There are some hard decisions that are going to have to be made.”
All this comes as the cabinet launches a new project to spend $700 million over the next six years to repair and replace 1,000 of Kentucky's worst bridges.
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