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Shrinking gas-tax revenues across the state will mean fewer gravel roads will be paved and northeast Indiana roads in general will receive less maintenance this summer.
Some counties say they could be a few years away from switching roughly paved roads back to gravel because of a chronic lack of money. Allen County, however, has seen its budget increase and plans to pave more county roads.
Rural county highway departments rely almost exclusively on the state’s gas-tax revenue and related state motor vehicle fees. Since 2005, that revenue has declined, with last year falling well below 2003 levels. That means less money to spread among cities, towns, counties and several statewide agencies, according to the state auditor’s office.
But shrinking property tax revenues will indirectly hurt county highway departments further this year and next as property tax caps take full effect. Counties that previously had local income tax dollars to spare for road and bridge work are now redirecting those dollars to supplement the general fund or focus on economic development projects that could put residents to work.
The Indiana State Police, Indiana Department of Transportation and the Bureau of Motor Vehicles rely on the same gas tax and vehicle fees for funding as highway departments. A portion of that revenue also goes to cities and towns to spend on street repairs.
Indiana had $539 million available to distribute to local governments and INDOT for the fiscal year that ended in July, compared with $564 million available in 2003. Revenue peaked at $624 million in 2005 before its steady decline.
The downward trend took a sharp plunge in 2008. Skyrocketing gas prices scared drivers into making fewer, shorter trips and buying fuel-efficient vehicles. So drivers bought fewer gallons of gas, generating less revenue to spread among 92 counties and hundreds of cities and towns, said John Habermann, program manager with Indiana Local Technical Assistance Program.
The program housed at Purdue University offers resources and guidance to local highway and street departments for road construction and maintenance.
Asphalt, a petroleum product, also jumped in price along with gas, but both have since dropped. Costs for retirement and health benefits for highway employees also eat into waning revenue, he said.
A Local Technical Assistance Program report released in 2009 found there is a “severe shortage of funds to adequately maintain local transportation facilities.”
Rural northeast Indiana counties are feeling the pinch.
Huntington County has not filled positions as highway workers leave, and it froze wages for this year. It’s the only county planning to chip and seal any gravel roads this summer; but workers will likely tackle just 1 mile, said Troy Hostetler, the county’s highway superintendent.
Chip-and-seal projects coat the stone road in an asphalt product, creating a rough paved surface instead of the dusty gravel.
The county used to convert 10 to 12 miles a year. Now, Hostetler is just trying to maintain the roads as they are, which involves recoating the converted roads to protect them from cracks and potholes, he said.
But $3 million in federal stimulus funds paved 25 miles of chip-and-seal roads with asphalt last year. “That helped a lot,” he said. “It’s easier to maintain asphalt.”
Few counties, however, benefited from the stimulus funds. Kosciusko received $1.4 million to repave Old U.S. 30 from the west county line to the east county line.
LaGrange County’s highway department previously received county economic development income tax revenue. Because of high unemployment in LaGrange, the county has few income tax dollars left and that money is funneled to boost the local economy, highway Superintendent Jeff Brill said.
“In the last three years we’re down $400,000 in revenue,” Brill said. To combat that loss, the department is repairing fewer miles of chip-and-seal roads each summer and will not improve any gravel roads to chip and seal this year.
Economic development-related income tax revenue will continue to convert about 8 miles of gravel roads to chip and seal this summer in Adams County. But dwindling gas tax funds will pay for about half the maintenance work needed to keep up with more than 500 miles of chip-and-seal roads throughout the county, Superintendent Mark Mitchell said.
Mitchell’s workers will do little paving this year, he said, because of the cost. The county received no stimulus funds and does not have a wheel tax.
The Kosciusko County Council tapped county economic development income tax funds to provide for some maintenance to chip and seal roads this year. But the county might not be able to offer those dollars next year. The revenue could be needed to fill shortfalls in the county’s general fund as the new property tax caps take effect, highway Superintendent Dennis Pletcher said.
Kosciusko has also flat-lined highway workers’ wages and has not bought new trucks or plows since 2004. He is trying to limit road repairs, Pletcher said.
Only Allen County seems to be increasing the amount of paving and road conversions planned for 2010. Stimulus funding will repave 52 miles of county roads this year, compared with seven miles in 2009. The county also plans to reseal more miles of road compared with last year, Highway Director Bill Hartman said.
The highway department received a larger share of CEDIT money this year compared with 2009 in large part because of $1.3 million set aside to convert 13 miles of gravel road to chip and seal. In 2009, the county converted just six miles of road, Hartman said.
In addition to gas tax and CEDIT revenues, Allen County also has a local wheel tax that provides additional funds for road work.
Steuben and Kosciusko counties said they are only a few years away from having to return badly damaged chip-and-seal roads to gravel because of the continuing budget shortfalls and escalating costs. Adams County isn’t likely to take that drastic step, and LaGrange County hopes it won’t have to make the decision, highway officials said.
“Within the next five years we’re going to have to start looking at that,” Steuben Highway Engineer Keith Lytton predicted.
Pletcher doesn’t expect Kosciusko’s funding woes to improve.
“It’s not going to be pretty to go back to gravel anymore. Our society is not ready for that. Your cars aren’t ready for that,” he said.
