Estimate of Florida Transportation Revenues Reduced by $1.5 Billion over the Five-Year DOT Program
The COVID-19 pandemic is taking its toll on state transportation funding. The new forecast from the Transportation Revenue Estimating Conference, predicts the state will collect nearly $1.5 billion less than expected in state transportation revenues through FY2025-26. This is a reduction of 5.7 percent. These funds are deposited into the State Transportation Trust Fund (STTF) to pay for the DOT work program.
The estimate for the current year (FY2020-21) was reduced by $432.2 million, dropping total SSTF collections from the previous estimate of $4.064 billion to $3.632 billion (10.6 percent). In addition, actual collections for the fiscal year just ended (June 30, 2020) were $198.1 million below estimate.
Fuel taxes, which provide most of the SSTF revenues, accounted for $1.114 million (6.8 percent) of the reduced estimate over the work program period. In addition to decreased fuel consumption due to COVID-19 and a more pessimistic economic outlook, increased fuel efficiency also factored into the revised estimate.
Rental car surcharge revenue projections were lowered by $121.7 million (13.9 percent), primarily due to far fewer tourists. The impact from alternatives to rental cars, such as ridesharing, is also resulting in growing downward pressure on revenues.
STTF revenues from taxes and fees related to motor vehicle license and registration were reduced by $234.6 million (2.8 percent).
The future of transportation revenues was already a growing source of concern. Gas consumption will be impacted by technological advances in fuel efficiency, electric vehicles, and remote work options, as well as the largely unknown impact of autonomous vehicles. COVID-19 is a major blow to an already lackluster forecast for transportation revenues.
These new estimates of transportation revenues come on the heels of the Florida Turnpike reporting toll collections were down $105.4 million (36.3 percent) over the three-month period of March-May 2020, compared to the same period the previous year.
The decrease in already-strained transportation revenue will require changes to DOT’s work program. Projects developed pre-pandemic will likely have to be postponed, eliminated or rethought. This makes the critical questions and issues recently published by Florida TaxWatch and raised by The Bond Buyer on the Suncoast Parkway multi-billion dollar toll road system even more critical to answer now than ever.”