In Portland, Oregon, Timothy Taylor is all too familiar with potholes. One near his home is so deep he hears cars crash into it from inside his house. Another pothole took a toll on his car, damaging the suspension for $1,000.
Taylor’s experience highlights a larger issue: Oregon’s roads are struggling, and without more funds, they may continue to worsen. State transportation officials warn that the revenue from gas taxes, the main source of funding for road maintenance, is declining. As more drivers switch to electric and fuel-efficient vehicles, the amount collected from gas taxes is expected to decrease.
According to the National Association of Budget Officers, gas taxes contributed 41% of transportation funds in 2016. By 2024, that percentage is projected to drop to about 36%. California is experiencing this issue first-hand, where sales of zero-emission vehicles made up around 25% of all car sales last year. Legislative analysts there predict gas tax collections could fall by $5 billion—about 64%—by 2035 if the state meets its climate goals.
The falling revenue is also evident in Pennsylvania, where gas tax income dropped by about $250 million compared to 2019. Inflation is pinching budgets further, raising the cost of the materials needed for road repairs.
In Oregon, the situation is critical. The Department of Transportation anticipates a budget deficit of over $350 million in the next cycle. If revenues don’t increase, the state might have to cut snow plowing and even lay off workers.
Critics have pointed to mismanagement by the department as part of the problem. An audit found that officials overestimated revenue by more than $1 billion in the current budget, which raises questions about how existing funds are being used.
To tackle declining transportation funds, 34 states have increased their gas taxes since 2013. California has the highest rate at over $0.69 per gallon, while Alaska has one of the lowest at around $0.09. In Oregon, the gas tax stands at $0.40 per gallon. The federal gas tax of $0.18 per gallon hasn’t changed in over 30 years, becoming increasingly inadequate as costs rise.
Some states are exploring new approaches to raise funds. Michigan now channels certain tax revenues, like those from cannabis sales, to transportation. In Connecticut, sales tax revenue for transportation now exceeds gas tax revenue, according to a 2024 fiscal report.
Innovative solutions are also emerging, like road user charges, which would charge drivers based on the distance they travel. Hawaii rolled out a program for electric vehicle drivers starting this year, and other states, including Oregon and Virginia, have voluntary road usage fee programs in place.
As states grapple with transportation funding challenges, the situation is evolving. Residents are increasingly aware of the impact of road conditions on their lives, revealing a growing interest in how infrastructure is funded and maintained in a changing vehicle landscape.
Check out this related article: Prepare for a Wet Future: NIWA Predicts Up to 20% Increase in Rainfall in Parts of New Zealand by 2100
Source linkenvironment,Climate,Business,Bruce Starr,Timothy Taylor,Gretchen Whitmer,U.S. news
