AASHTO Journal, 20 March 2015
Kentucky Gov. Steve Beshear is warning that the state’s receipts from motor fuel user fees are shrinking, and state lawmakers have little time left to fix the problem before a March 24 end of their legislative session.
Beshear has been pressing legislators, the AP reported, to pass legislation that would stabilize the road fund either by stopping the gas tax decline or limiting its impact.
A state law on the percentage levy for fuel has such a low floor price that state highway funding could suffer a major decline unless lawmakers act.
As AASHTO Journal has reported, Mike Hancock, secretary of the Kentucky Transportation Cabinet, has said a Jan. 1 drop of 4.3 cents in the state excise tax, and a scheduled April 1 decline of 5.1 cents, would cut $56.4 million out of the budget in the current fiscal year and $194 million more in fiscal 2016.
Beshear said he not seeking a fuel fee increase. “Whatever solution we might find won’t be raising everybody’s taxes,” he said in the AP story. “Hopefully we’ll be at least stabilizing further drops in the road fund.”
The AP also said road fund collections fell 9.1 percent in February to $112 million, from $124 million in the same month last year.
Kentucky’s road fund had about $450 million in it as of March 17, the story said, all of which is committed. The story also reported that if the fuel tax continues to drop the road fund would drop below $100 million by August 2016, and trigger a budget reduction plan.