SALEM — Oregon transportation officials say they may have to scale back plans for highway work because revenue from road users is coming in more slowly than expected.
Cash-strapped drivers are using less gasoline, so they’re also paying less in gas taxes — and that means Oregon stands to lose $150 million or more in federal funding, officials warn. At the same time, Oregon Department of Transportation officials are also predicting a decline in state income.
“One of the greatest risks we face is the uncertainty at the federal level,” Clyde Saiki, deputy director of ODOT’s Central Services Division, told state lawmakers Wednesday.
It’s too early to know which projects would be canceled or delayed, officials say, but the decisions would be based on directions from Congress and the Oregon Transportation Commission.
The federal Highway Trust Fund, which gets much of its funding from gas taxes, is collecting less revenue than Congress and the states have budgeted. Congress has injected cash three times to keep funding flowing to planned projects, but Oregon officials worry that deficit-reduction efforts will make another influx a tough sell. Rep. John Mica, R-Fla., who chairs the House Transportation Committee, has proposed aligning Highway Trust Fund revenues with expenditures.
Under that plan, Oregon would get $150 to $175 million less from the federal government and would have to scale back transportation projects already in the works, state officials said.
ODOT officials predicted the shortfall in federal funding and planned for a reduction of about 20 percent, but that’s not enough to handle a federal shortfall that could exceed 30 percent, said Travis Brouwer, ODOT’s federal affairs adviser.
“We would have to further delay or cut projects below the cuts we have already made, which are pretty substantial,” he said.
Projections of state transportation revenue aren’t much brighter.
ODOT economists say the State Highway Fund — a road-improvement account fed by state gas taxes, vehicle registration costs and other user fees — will collect $110 million less over the next four years when compared with their previous estimates six months ago. Economists have revised their forecasts downward each time since 2008.
Officials say the combined state and federal funding shortfalls would mean fewer road and transit projects and more deterioration of existing highways. Local governments, which get about one-fourth of ODOT highway revenue, also stand to take a big hit.
In 2009, the state Legislature boosted Oregon’s gasoline tax to 30 cents per gallon, projecting $300 million in revenue every year for transportation projects. Economists now say the Jobs and Transportation Act, as the effort was known, will raise about 7 percent less in the current fiscal year, shaving about $21 million of anticipated funding for state and local governments.
ODOT is reducing its workforce by about 5 percent over the next three to five years, ODOT’s Saiki said.
Rep. Phil Barnhart, D-Eugene, said the reduction in funding from the federal government will mean ODOT and local governments will have less money available to hire construction workers.
“So whether we are able to proceed with economic activity that leads to job growth in Oregon will depend very much on what Congress does with this issue,” Barnhart said. “The Legislature’s done its job. Now it’s up to Congress.”