With people driving less, PennDOT puts brakes on some road and bridge projects - PennLive

Pennsylvanians are driving less because of the coronavirus pandemic and that’s putting the brakes on some road construction projects.

Why? Pennsylvania relies heavily on the gasoline tax to finance work on roads and bridges. With people driving less and buying less gas, the state is seeing less revenue from the gas tax.

The Wolf administration is projecting gas tax revenue could decline as much as $800 million over the next 18 months. That’s a worst case scenario, according to the Pennsylvania Department of Transportation.

Nonetheless, PennDOT is planning for a steep drop in gasoline tax revenue and is readjusting its scheduled projects. PennDOT projects spending at least $300 million less in construction projects than the agency initially planned.

“We’re trying to prepare ourselves,” said Alexis Campbell, a PennDOT spokeswoman. “We’re trying to be smart and not get blindsided if that trend continues.”

PennDOT initially planned to seek bids on projects totaling about $2.2 billion in 2020. The agency now estimates it will do about $1.8 billion or $1.9 billion in road work, Campbell said.

Road and bridge projects that are already underway will continue, Campbell said. But some projects that haven’t gone out to bid or aren’t under contract are being postponed.

PennDOT has withdrawn advertisements for bids on 19 projects. Additionally, seven projects which had been bid but aren’t under contract are postponed, she said.

PennDOT has pulled advertisements on a project to resurface a portion of the Carlisle Pike. A road resurfacing project just outside the city of Reading is also on hold.

State Rep. Joseph Ciresi, a Montgomery County Democrat, fumed that two projects were put on the back burner in his district in the Philadelphia suburbs. He understands PennDOT, like all of state government, is seeing less revenue due to the pandemic.

But he said these projects are needed.

“These are all safety issues,” Ciresi said. “These are things they’ve been waiting for a long time. I don’t think it’s fair. These are intersections that need this.”

PennDOT has pulled advertisements on a project to resurface a portion of the Carlisle Pike in Cumberland County. Another resurfacing project just outside Reading is among those being delayed.

Looking forward, PennDOT will pull back on some road resurfacing projects, Campbell said. PennDOT instead will do more patching and crack sealing on some roads.

Some bridge replacement efforts may shift to less expensive preservation projects, Campbell said.

Driving changes could be permanent

Other states are seeing similar challenges as people are driving less. Gasoline demand has started rising again but it’s still down about 15 to 20 percent compared to last year, said Patrick DeHaan, an analyst at GasBuddy.

“States, all 50 of them, have suffered a drastic decline in gasoline revenue as a result of lower demand,” he said.

In fact, Pennsylvania is likely suffering less than other states from people driving less for one simple reason. Pennsylvania’s gas tax is the highest in the country, DeHaan said.

The state imposes a 58-cent tax on gasoline; the federal government levies an additional tax of 18 cents. Then-Gov. Tom Corbett and state lawmakers raised the gas tax in 2013 to generate revenue to fix the state’s ailing roads and bridges.

The Tri-County Regional Planning Commission recommends road projects for Cumberland, Dauphin and Perry counties. The organization is finalizing its list of projects for 2021 for PennDOT.

With less gas tax revenue, the wish list is a bit smaller, said Steve Deck, the commission’s executive director.

“We weren’t able to add as many new projects to the list this time around,” Deck said.

The commission still has a number of projects it is recommending for 2021. They include intersection improvements at Cameron and Maclay streets in Harrisburg; road work on Route 11 in East Pennsboro Township; and resurfacing on Route 22/322 in Perry County.

People are starting to drive more regularly than they did and more people are going back to work, so gas sales are climbing a bit. But Pennsylvania’s unemployment rate was 13 percent in May and more than 2 million people have filed unemployment claims because they’re out of work.

Many people who have been working from home since the pandemic emerged in March. That raises the bigger question: How many people will skip commuting in favor of working at home in the future?

If more companies allow employees to work remotely, the decline in gasoline consumption may not be temporary.

“There could be permanent lifestyle changes as a result of COVID-19,” DeHaan said. “You may see 5-10 percent of demand that doesn’t return for years, if that.”

“I don’t think we’ll ever get back to 100 percent,” he added.

1. The Lehigh Valley entrance to the Pennsylvania Turnpike Northeast Extension (Interstate 476) is seen in July 2011 in South Whitehall Township.AAAAAAAA

Better source of funding

The gasoline tax has been less reliable in recent years. With cars getting more fuel-efficient, along with the growing sales of hybrids and electric vehicles, states have already seen less revenue from the gasoline tax.

“It’s a significant problem,” Deck said. “What we’re going through with COVID-19 is a short-term problem. Longer term, the bulk of the funds in Pennsylvania come from the gas tax. With fuel efficiencies increasing, those revenues go down.”

Transportation officials say there needs to be a more sustainable funding solution, both in Harrisburg and in Washington.

Robert Latham is the executive vice president of the Associated Pennsylvania Constructors, a trade group representing companies involved in road and bridge work.

“I guess we always sound like a broken record when we say there’s not enough money, but there’s not enough money,” Latham said.

Latham said the president and Congress ultimately need to reach an agreement on a new federal highway bill. And he hopes the General Assembly will consider a different approach to funding transportation.

“When the legislature reconvenes in the fall, we’re hoping transportation will be part of the conversation,” Latham said.

State Rep. Michael Carroll, D-Luzerne, is the Democratic chairman of the House Transportation committee. With the pandemic posing so many challenges to state government, Carroll said he expects state lawmakers probably won’t dive into overhauling transportation funding until next year.

“We’re going to have to get past the pandemic,” Carroll said.

“It’s hard to imagine the General Assembly at this point in time taking this up.”

Carroll said the state clearly needs a different approach to funding transportation. Pennsylvania faces more than a problem with declining gas tax revenue.

The Pennsylvania Turnpike Commission has been supporting the state’s mass transit operations. The turnpike commission has been paying $450 million annually to PennDOT for rail and bus systems.

But fewer people are driving on the toll road, so the turnpike is seeing a steep drop in money from tolls. Turnpike toll revenue dropped by more than $100 million for the fiscal year ended May 31. The drop in toll revenue prompted the turnpike commission to accelerate its plans to shift to cash-free tolling permanently; the commission laid off 500 workers.

Subsequently, the turnpike commission has delayed its July mass transit payment of $112.5 million to PennDOT.

Lawmakers face another deadline related to the turnpike’s support of mass transit. In 2022, the turnpike commission’s annual mass transit payments drop from $450 million to $50 million.

In addition, the turnpike commission has reduced its capital spending and is scaling back its repair projects as well.

At some point, Carroll said lawmakers and Gov. Tom Wolf have to find a viable way to finance transportation. But it’s going to require a lot of money and enormous political will from the governor and lawmakers of both parties.

“If you do a transportation bill, generally there’s a need for additional revenue,” Carroll said.

Many lawmakers “are allergic to fee and tax increases,” Carroll said. “You can’t solve the transportation problem without additional revenue.”

Other ideas, such as tolling other roads, haven’t garnered support, Carroll noted. Ultimately, lawmakers and the governor will have to look at the big picture when it comes to transportation funding.

“I doubt we’ll do transit without roads and bridges, and I doubt we’ll do roads and bridges without transit,” he said.

Julia Shanahan contributed to this report.

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