FY 2009-10 Transportation Budget Recap

FY 2009-10 Total Budgeted Appropriations: $2.62 billion
FY 2008-09 Total Budgeted Appropriations: $2.91 billion (may not reflect actual expenditures)

New Bill Increases Gas Tax
Senate Bill 200 (Sen. Jenkins D – Edgecombe) increased North Carolina’s gas tax by $50 million. The bill would impose a floor (or minimum) for the tax consumers pay at the pump. North Carolina’s gas tax is calculated, in part, by a variable rate based on the price of gas. In short, as the price of gas rises or falls, so too does the state gas tax.

SB 200 ensures that the gas tax will not fall below 29.9 cents per gallon for the period from July 1, 2009 to June 30, 2011 – even if gas prices fall to a point that would otherwise permit the gas tax to drop below that amount.

The bill reverses a 2008 law that capped the state gas tax at 29.9 cents per gallon. What was the maximum allowable gas tax has become the minimum rate.

According to state budget office estimates, the result will be consumers paying $50 million more in gas taxes for FY 2009-10 than they would have without the tax floor.

Highway Fund
The Highway Fund revenues traditionally come from the state gas tax, motor vehicle registration fees, title fees, and federal-aid appropriations. The Highway Fund contributes to highway construction and maintenance, the State Highway Patrol and the Division of Motor Vehicles.   

• 152 appropriations supported positions and 751 field positions are eliminated.
•  20 new Ferry Oiler positions ($33,445 each), 27 Ferry Member II positions ($32,232 each), 27 Ferry Crew Member I positions ($28,265 each), and 5 Marine Pipefitter and Welder positions ($42,121 each) are added. The collective 79 positions cost a total of $2,512,924 in salaries and $603,343 in benefits.
• Funds for maintenance of the State highway system is increased to prevent further deterioration of the highway system, total budget for maintenance is $935,999,755 in FY 2009-10.
• The step increases for the salaries of Troopers are frozen saving $1,674,280.
• Department-wide administrative cuts for DOT total $9.2 million for FY 2009-10.
  • DOT – General Administration spending drops to $79,838,391.
  • Highway Division Administration is reduced to $33,339,661. 
  • The total DMV budget is changed to $101,416,528.

Highway Trust Fund
Funding for the Highway Trust Fund is provided by the motor fuels tax, title fees and highway taxes. Spending is directed toward supporting specific highways that will be four-laned or improved. Changes in funding are primarily due to statutory formulas adjusting for lowered revenue expectations.

• Funds for administration are reduced by $6,367,680 to $42,234,720.
• Funds for Aid to Municipalities are reduced by $8,203,784 to $41,423,903.
• Funds for the Urban Loops are reduced by $31,616,120 to $116,655,736.