March 17, 2023
By: Dwayne Page
County Highway Departments across the state stand to gain if the Governor’s budget as presented is adopted calling for $300 million to expand the State Aid Program to fund road projects.
State Representative Michael Hale told WJLE Wednesday that according to the Tennessee Department of Transportation, the DeKalb County Highway Department’s allocation from the State Aid Highway Program Investment fund for the 2023-24 year would be $2,515,518 if the budget is approved, which would be significantly more than usual.
“That will be huge for our county roads,” said Representative Hale.
“The governor’s proposed budget includes a $300 million one-time investment in the State Aid Road program, which currently receives just $21 million each year. This amount equates to 15 times what is normally budgeted. The funding would be distributed just as it has in the past and would become available this July in the new fiscal year,” said Hale.
DeKalb County Road Supervisor Danny Hale told WJLE Thursday that this is welcome news but it won’t solve all the road problems in the county.
“Its a start and we are tickled to death to get it but we have 514 miles of roads in DeKalb County and most don’t qualify for funding under the state aid program because they (state aid roads) have to be 18 feet wide and paved or tarred and chipped,” said Hale. “We have a lot of roads that don’t meet these requirements and there is no funding for them other than from the limited resources of our local budget. To tar and chip a road costs me about $60,000 a mile without a lot of preparation work. If I contract it out the cost is about $90,000 a mile. The cost to pave or hot mix a road is about $200,000 a mile,” Hale continued.’
“If the governor’s request to expand funding for the state aid program is approved by the legislature, DeKalb County is expected to get $2,515,518 with a $51,337 local match requirement from the local road department budget which would be paid in percentage according to our projects. The funds can be spent as needed. For example, if we do a $500,000 state aid project, we have to pay 2% on that $500,000 project at that time which goes toward that $51,000 match,” said Road Supervisor Hale.
Along with the possible increase in state aid funding, the local road department is already receiving another financial shot in the arm from the county commission’s recent allocation of one million dollars from ARP funds.
“This year we are getting one million dollars from ARP money from the county with which we may be able to tar and chip 14-15 miles of road and that is a significant help,” said Road Supervisor Hale.
“I hope the state recognizes that this is not just a one year funding solution and steps up to provide more money in the future. Having good safe roads to travel is a priority because everyone uses them every day including school buses, mail carriers, ambulances, law enforcement officers, firefighters, etc.,” he said.
Road Supervisor Hale said he would like the federal government to also get involved in helping fund local road departments.
“I have talked to Congressman John Rose’s office about federal funding. Counties do what they can but local highway departments here and across this state are underfunded. We need help federally. You can get a grant for a hang nail these days but there is nothing for a rural county road from the federal government. I would like to see that change,” he said.
Another bill, supported by the Tennessee County Highway Officials Association (TCHOA), would hike the vehicle registration fees on electric and hybrid vehicles in Tennessee as a way to recoup the loss of revenue from the tax on the sale of gasoline that is provided to the state as more consumers over time replace their traditional combustion engine automobiles with electric vehicles.
“County road departments are mostly funded by gas and diesel taxes,” said Road Supervisor Hale. The state collects all gas and diesel tax and they take 50% for state roads while the other 50% is divided among the 95 counties according to population and land mass. What they are proposing with the EV fees is to make up the loss of gas and diesel tax revenues,” said Road Supervisor Hale.
According to the Tennessee Department of Transportation, the funding from the gas tax is added to TDOT’s total state budget and is used for road resurfacing, bridges, major reconstruction projects, new construction, consultant contracts, right-of-way purchases and to match federal funds, highway maintenance contracts and basic operating costs.
The TCHOA reports that proposed legislation calls for a $274/year registration fee on EVs and a $100/year fee on pluggable hybrids that use a combination of electric battery and gasoline. Based on current registrations, counties would get an estimated $1.2 million through these fees in the first year of implementation. That amount is estimated to grow significantly as EVs become a greater percentage of the total number of vehicles registered in Tennessee. EVs and hybrids make up about 2 percent of total registrations today. There is an expectation of exponential growth in the EV/hybrid sector, with possibly upwards of 200,000 EVs in Tennessee by 2028. The current EV fee is not shared with local governments. According to TCHOA, the Administration has accepted TCHOA’s proposal to share all future registration fees on fully or partially electric vehicles, just as the current gasoline tax is distributed. The plan is to create parity in the revenues generated by electric vehicles (EVs), versus their traditional combustion engine counterparts.
During his state of the state address last month, Governor Lee presented budget and legislative priorities for the upcoming year to a joint session of the General Assembly and fellow Tennesseans.
Notable highlights from Gov. Lee’s FY23-24 agenda included:
Transportation & Infrastructure Modernization
-$3 Billion to the Transportation Modernization Fund to alleviate urban congestion and fund rural road projects across the state
-$750 Million allocated to each of TN’s four TDOT regions
-$300 Million to expand the State Aid Program for local road projects
-Proposing new comprehensive legislation centering on Alternative Delivery Models, Public-Private Partnerships, Electric/Hybrid Vehicle Fees.