11/27/06-Dwindling tax dollars for roads and increasing highway construction costs could mean higher taxes at the fuel pump in Iowa.
The Iowa Legislative Services Agency has issued a report that said road-use money is expected to reach $1.1 billion this fiscal year, which is about $700,000 below last year. It is only the second time in a quarter century that the road use tax fund faces a downturn in revenue, The Des Moines Register reported.
The decline in the fund is attributed to such factors as a decrease in use tax revenues, which are collected on the purchase of cars and trucks; and modest increases in fuel tax revenue and vehicle registration and title fees.
The funding problem is compounded by increased construction costs, a decline in the rate of growth of federal and state highway dollars, and road building demands.
A 5-cent increase in the state’s fuel tax would generate $110 million annually, The Register reported.
Truckers in Iowa now pay state taxes of 22.5 cents per gallon on diesel. Other drivers pay 21 cents per gallon for gasoline.
To make matters worse for the state, a new $2 billion, five-year road construction program approved this month by the Iowa Department of Transportation has projected costs that exceed revenues by $90 million.
State House Speaker-elect Patrick Murphy, D-Dubuque, said that Democrats will likely discuss the road funding issue at a policy caucus next month.

10/11/06-The cost of roadwork in Iowa is increasing at the same time revenues are slowing down, according to state transportation officials.
As a result, Iowa Department of Transportation officials said Oct. 10 in Sioux City that construction projects could be delayed. Agency officials said the price tag for all the projects in its five-year plan exceeds funding by about $90 million, KCCI-TV in Des Moines reported.
The department attributed the shortfall to increased construction costs, a decline in the rate of growth of federal and state highway dollars, and road building demands.
On average, 20 cents from every gallon of fuel sold is used to help pay for transportation construction and maintenance. With less money coming in, something gets affected.
“At some point, we’re going to have to get some additional revenue to support our system or the maintenance that’s necessary won’t be completed,” IDOT’s Dena Gray-Fisher told the news station.
In the meantime, the department is taking a wait-and-see approach to projects included in the entire program, which includes fiscal years 2007-2011.
Projects that could be affected include four-lane expansion along U.S. 20 and 30, a U.S. 60 bypass around Fort Madison and widening of Interstate 80 in Johnson County.
Construction on Interstate 235 in the Des Moines area is still on schedule to be completed by next fall.
Among the potential revenue sources that could be tapped to help pay for needed roadwork is increasing the state’s tax on diesel and gasoline. Another option could be to target vehicles running on alternative fuels, KCCI reported.
The targeting of alternative fuel vehicles for additional revenues comes about five months after Gov. Tim Vilsack signed a bill into law that is intended to make 25 percent of all fuel sold in the state either ethanol or biodiesel blends by 2020.
DOT officials are expected to present the Iowa Legislature with a report by year’s end, outlining construction and maintenance needs and projected funding, KCCI reported. The report also is expected to identify ways to increase revenues.