Gas Tax Low in Alabama By Using Less Gas – Running On Empty

Alabama Transportation Director John Cooper has an impressive background that includes six years as CEO of Avocent Corp., an information technology infrastructure company, as well as a master’s degree in accounting from the University of Alabama.

But even those credentials are tested when facing his now-daily business dilemma: maintaining Alabama’s 101, 000 miles of public roads and thousands of state bridges while hearing increasingly shrill calls for new pavement, including loops around Birmingham and Montgomery and a new Mobile River Bridge.

Cooper, picked as Alabama’s top road boss in Gov. Robert Bentley’s first term, talked with Business Alabama last month about his challenges in 2015.

While ALDOT has its own funding woes, they don’t necessary resemble those of other state agencies. The state’s General Fund, which covers most non-education expenses in Alabama, is projected to be more than $200 million in the red for the fiscal year that starts Oct. 1. Bentley has hinted that new revenue must be found, though lawmakers might not go along.

“Technically we are a General Fund agency, but we’re really not part of the General Fund, and that’s where most conversations about shortfalls have focused. There’s really been very little conversation in any public sense on transportation funding, but I hope that starts to change, ” says Cooper. “Our funding is static and the needs are growing, and people conclude pretty quickly that it’s not an equation that works well. Practically every (new construction) project we’ve undertaken is taking longer than we’d hoped it would.”

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The Problem

Revenue from the gasoline tax, the money that goes into building and maintaining roads, continues to decline in Alabama. Cars are using less gas, and Alabama’s state gas tax is collected on a per-gallon basis. That means Alabama is collecting less for every mile driven. — Public Affairs Research Council of Alabama, May 2014

How Alabama Rates

Last time gas tax was adjusted: 1993
Percent of state roads in poor condition: 21
Percent of state bridges that are obsolete or deficient: 23
Amount fleet efficiency has increased: 20-25 percent
Cost of road building since 1993: Up 2.5 times
Road fatalities: 13 deaths per billion vehicle miles traveled, 13th highest rate in the nation.
Interstate expansion in past 40 years: Almost none
— Sources: ALDOT, PARCA

 “The combination of no change in the gas tax, the increased cost of building and maintaining roads and the flattening of miles driven has compressed the available funding to the point that we’re becoming a maintenance agency rather than a building agency. If you look at the interstate system, outside of same lane additions in urban areas — and those have been insufficient — there has been almost no expansion in 40 years.” — Alabama Transportation Director John Cooper 

By the Numbers

17 – Number of counties in Alabama that don’t have a four-lane route to an interstate highway, something that companies almost always look for when deciding where to locate.  — ALDOT

28 – The number of times federal transportation programs have made do with short-term authorizing bills in the past six years, in the absence of a comprehensive roads bill. — U.S. Secretary of Transportation Anthony Foxx

39.3 – Alabama’s tax rate in cents per gallon, ranking it seventh among Southeastern states. Alabama’s rate is about 10 cents per gallon less than the national average and 4 cents less than the regional average. — PARCA

18 – Average minutes of commute time in Huntsville, according to the city’s website. In 2013, Huntsville Mayor Tommy Battle and the City of Huntsville devised a “Restore Our Roads” campaign to address the fact that the city was the state’s only major urban area without a loop road or completed limited access highway between its north-south and east-west boundaries. In late 2013, the city and ALDOT agreed to undertake seven major road projects, with the city covering half of the $250 million cost by adding a penny to its sales tax. Huntsville went so far as insisting ALDOT sign a contract stating the work would begin within five years. “Other areas are talking about that, but not a lot of areas in the state have the ability to do what Huntsville did, ” says ALDOT Director Cooper. — City of Huntsville

When the Gas Tax Worked

In the two decades after the state and federal governments each added 5 cents to the motor fuels tax in 1993, Alabama saw these positive developments:

  • More than 20, 000 lane miles added to road system
  • Percentage of structurally deficient or functionally obsolete state bridges dropped from
    41 to 23
  • Number of fatalities on Alabama roads down 17 percent, despite increases in population and traffic

— Public Affairs Research Council of Alabama

Your Grandchildren Will Love Them

They’re the high-profile projects that the public clamors for, the slick roadways that stalled commuters dream of as they inch through snarled traffic:

  • Northern Beltline, 52 miles around Birmingham: $5.2 billion
  • New Mobile River Bridge: $850 million
  • Montgomery Outer Loop: $2.4 billion

What’s the Answer?

“I don’t know how to handicap the possibility of (a comprehensive road bill being passed in 2015). People who purport to know are not terribly optimistic. Congress has been unable to agree on long-term transportation funding. The ultimate answer might be a fee on miles driven, which is the most fair way to do it. No method exists right now to do that, or at least it doesn’t exist widely. But I believe we’ll develop the ability to do that.” — Alabama Transportation Director John Cooper 

Dave Helms is copy editor of  Business Alabama. Robert Fouts is a freelance photographer who lives in Montgomery.

text by Dave Helms • photos by robert fouts

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