AASHTO Journal, 20 March 2015
South Dakota Gov. Dennis Daugaard signed into law March 17 a new road and bridge revenue measure that would send more than $68 million in its first year to the state highway fund and devote another $17 million to local government spending on transportation infrastructure.
“Maintaining our roads and bridges is a fundamental function of government. In order for us to get to work, school, church or the grocery store, we have to have adequate roads,” said Daugaard. “This important legislation will significantly aid state and local governments in maintaining and improving infrastructure.”
Darin Bergquist, secretary of the South Dakota Department of Transportation, said the money generated by that legislation “will go a long way toward helping us continue to preserve and maintain a safe and efficient transportation infrastructure for the people of South Dakota and others who travel on our highway system.”
SDDOT estimates that measure, which cleared the Legislature on March 13, will generate $39 million – nearly half its $86 million total – from a 6-cent increase as of April 1 in the per-gallon user fee on gasoline and diesel fuel.
That will raise the state motor fuel user charge to 28 cents a gallon from 22 cents.
A similar 6-cent hike in the user fee on ethyl alcohol fuel should produce $2.25 million for the state roads fund, while an increase in the excise tax on vehicle purchases to 4 percent from 3 percent will bring in an expected $27.2 million.
An increase in various license plate fees would raise $17.3 million for local governments to spend on roads and bridges.
Out of the new revenue, the state and local accounts would jointly fund a new $15 million bridge improvement grant program, from which the state Transportation Commission may award grants to any qualifying local government to build and upgrade bridges.
On top of those revenues, counties have authority under the new law to raise their local, per-vehicle “wheel taxes” while counties and townships can raise property taxes for their road needs.
Here is a graphic from the SDDOT that illustrates the main features of the new law.
That means the total to be generated statewide for the transportation network under this measure could end up being considerably more than the projected $86 million, depending on the response by local authorities.
The bill also raises the maximum allowable speed limit to 80 mph from 75 on the two interstate highways in South Dakota, east-west I-90 and north-south I-29.