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Gas Tax Woes: Illinois Roads May Crumble as People Go Green

Since 2007, governments responsible for shoring up our roads and bridges have watched gasoline taxes — the largest funding source for road maintenance and repair — dwindle as people choose more fuel efficient modes of transportation.

There's just one problem with the push to drive less, buy an electric car, commute by public transit or ride bikes: People are doing it.

"I feel so much better," said Scott Sanderson, who ditched his car years ago in favor of pedaling his bike to Willis Tower from the Roscoe Village neighborhood. "It's not just my physical health that's better. It's my mental health. That car commute was infuriating. It was just so much stress."

Sounds good. Right?

Not if you're a transportation planner.

Since 2007, governments responsible for shoring up our roads and bridges have watched gasoline taxes — they are the largest funding source for road maintenance and repair — dwindle as the country steers away from gasoline.

"We have environmental policy that's trying to encourage moves away from petroleum," said Bob Poole, director of transportation policy at the libertarian Reason Foundation. "But the problem is if we try to exclude those people from paying for the highways, and, if we're successful — you think we have potholes now, we're going to have nothing but potholes as the funding dries up."

In 2007, Illinois collected $1.59 billion in gas tax receipts, according to a Chicago Metropolitan Agency for Planning analysis of Illinois Department of Transportation data adjusted to 2014 dollars. In 2013, that had ticked down 24 percent, to $1.21 billion, adjusted to 2014 dollars.

One reason: People are driving less. Vehicle miles driven per capita on Illinois roads has fallen 6.5 percent since its peak in 2004, according to Federal Highway Administration and Census Bureau data. The recession was a factor, but studies suggest that the change in driving habits is likely to stick, particularly among younger people who socialize via technology rather than driving.

Those who do drive also are using less gasoline. So far, government analysts say that's not a huge factor in driving down gas tax revenue. But with new government standards expected to boost average fuel efficiency of new vehicles from 29.7 miles per gallon to 49.6 miles per gallon in 2025, such improvements in fuel efficiencies are expected to increasingly tamp down gas tax revenue.

At the same time, more people are turning to vehicles fueled by electricity or natural gas or are opting for other forms of transportation. Nationwide, bike commuting grew 61 percent from 2000 to 2012.

Chicago more than doubled its rate of bicycle commuting from 2000 to 2012, according to the Census Bureau. Half a percent biked in 2000 versus 1.3 percent in 2012.

Old Town neighborhood resident Jordan Horwitz, 28, rents a Divvy bike or borrows his girlfriend's car if he can't get to a destination using the CTA. If he ever is in the market for a motorized vehicle, he says he'd opt for a moped, "something smaller that has even better gas mileage."

Dave Crosson, vice president and office leader at HNTB Corp., an infrastructure solutions firm, said people have changed the way they travel since 1993, the previous time the federal gas tax increased.

"People are taking mass transit," he said. "People are riding their bikes. They're walking more. And you're also seeing baby boomers moving into urban areas and fewer young people moving out of urban areas."

In the Portage Park neighborhood, Harold Ward, 37, said improvements in biking infrastructure, combined with more stores offering delivery, have made it easier to go car-free.

"For big-ticket items, I can shop and have it delivered," Ward said. "I don't have to get the big-screen TV in the minivan and drive it away from the shopping mall."

Ward, who commutes to his job in Northbrook on a Metra train, said he uses that time to do homework toward another degree.

The changes in how people are traveling is not good news for Illinois' crumbling infrastructure. Illinois received a C- rating on the 2014 infrastructure report card from the American Society of Civil Engineers. For roads, the state got a D+, with the society claiming that 42 percent of Illinois' major roads are in "poor or mediocre condition."

"Funding sources must be supplemented with a long term sustainable funding source at the state and federal level. Illinois' poor roads will continue to hinder the State's ability to spur economic growth and build sustainable, efficient communities," the report said.

Efforts to increase funding by adjusting the way taxes are levied have not worked, according to IDOT.

In 2013, the Transportation for Illinois Coalition proposed eliminating the state motor fuel tax and replacing it with a combination of taxes on the wholesale price of fuel and other registration fees. The bill didn't move forward.

In 2014, the same coalition proposed keeping the motor fuel tax but diverting the state's share of the sales tax (80 percent of the 6.25 percent rate goes to the state; the remainder is split between local governments) from the state's general fund and adding it to a dedicated motor fuel tax fund. But that idea was scotched because it would have meant figuring out other ways to replenish the general fund.

"What's happening is that the states, the governors, have realized that Congress is not coming to the rescue," said Rick Geddes, director of Cornell University's Infrastructure Policy Program. "States are looking at all sorts of different options for funding their systems. Virginia has increased sales tax. Others are doing more tolling at congested times. Some are increasing their own gas and diesel taxes."

Instead of taxing gasoline, Oregon is watching a pilot program that taxes drivers based on the number of miles driven and on which kinds of roads. The program requires adding a device to vehicles that tracks where drivers are going and how far they are traveling, which makes some people nervous about privacy issues.

Why not just increase the taxes on gasoline? After all, the gas tax hasn't kept up with inflation. The previous time the state increased the motor fuel tax was 1990, when the rate went from 16 to 19 cents per gallon. Federal gas taxes have stayed at 18.4 cents per gallon since 1993.

One result, Poole said, is inequity.

"The early adopters of alternative fuel vehicles, these are more expensive than the average car, and it's the lower-income folks who stick with old, used cars for as long as they can keep them going, and they're the ones who are going to be hit the hardest with any increase in the gas tax," he said.

State governments aren't the only ones struggling. Over the past five years, Congress has transferred $53 billion from the general fund to the Highway Trust Fund in order to compensate for lagging gas tax revenues, according to the Institute on Taxation and Economic Policy. The Highway Trust Fund supports 39 percent of Illinois' infrastructure needs, according to the American Road and Transportation Builders Association.

The Highway Trust Fund receives 85 percent of its funding from gasoline and other motor fuels, according to the Congressional Budget Office.

"For the past few years, there hasn't been enough money in the Highway Trust Fund, so they've been pulling money out of the general fund," said Crosson, of HNTB. "When the Highway Trust Fund was set up, it made sense. But it hasn't been indexed for inflation and fuel efficiency. It's woefully underfunded."

©2014 the Chicago Tribune