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SCDOT Commission Workshop
SCDOT Commission workshops serve as an excellent opportunity for Commissioners to have an open discussion with SCDOT staff on programs, policies, and the issues that affect their districts and the state as a whole. Thursday’s workshop provided Commissioners the opportunity to discuss potential changes to the pavement program funding allocations and to receive updates on the 10-year plan and the proposed 2020-2021 annual budget.
Pavement Program Funding Allocation
There is no one size fits all approach to allocating funding to counties. One formula may benefit some counties while adversely impacting others. Urban, rural, large, small, finding a balance between fairness and effective use of funds is difficult. 

Currently, funding allocations to counties for pavements are based on lane miles.

Commissioners discussed possible alternatives for changing the funding formula and the impacts on county funding. After much discussion on various scenarios, Commissioners concluded that the current methodology is the best way to allocate funds at this time.  They also noted that the changes approved in June would likely help when it comes to fixing bad roads. 
The SCDOT Commission approved changes in June to provide more flexibility for counties and allow them to use more money for rehabilitation and reconstruction over preservation. Now, counties will only be required to spend 10% of their allocations on preservation, and the remainder can be spent on rehab/reconstruction. This adjustment will allow for more funding to be used on the worst roads – the ones that need much more than preservation. Details on those changes and the 2020 Pavement program can be found here

It is clear that finding a balance between fairness and effective use of funds is difficult. Therefore, the formula that is used to determine how funds are divvied out is critical. However, after the discussions that took place Thursday, perhaps in the long run, it’s not revamping how those funds are allocated, but simply adjusting how those funds are used that may prove to have the best impact.   

The full pavement program allocation presentation can be found here. 
Impacts of Various Funding Scenarios
 
Scenario 1:    CTC formula (Land Area, Population, Rural Lane Miles)  – Favors counties with large populations and land areas (urban), a few rural counties saw an increase due to a large percentage of rural lane miles. 63% of the counties saw a decrease.

Scenario 2:    Modified CTC  (Land Area, Population, and Lane Miles ) – 72% of the counties saw a decrease in funding.

Scenario 3:    % Poor Condition – Hurts the counties with sales tax programs and those with good preservation programs. 46% of the counties saw a decrease in funding.

Scenarios 4 & 5:    Lane Miles & Daily Vehicle Miles Traveled – 67% of the counties lose funding; the majority of them are rural.

Scenarios 6 & 7:    Combinations – various combinations using Lane Miles, Daily Vehicle Miles Traveled, and % Poor yielded results where 39% to 70% of the counties lose funding.

Scenario 8:    Condition & Lane Miles – 39% of the counties saw a decrease in funding, with 44% of those being sales tax counties.

Scenario 9:    Daily Vehicle Miles Traveled (DVMT) – The urban counties were the big winners at the expense of the rural counties. 67% of the counties lose funding.

Scenario 10:    % Lane Miles – The overall total allotment is the same as looking at the old condition-based method; the differences shown are rounding errors.

A detailed look at the revenue impacts for each county based on the scenarios listed above can be found here. 
10-Year Program Update
Pavement Program: Interstates are trending ahead, and while there seems to be a slight decline among the other categories, these fluctuations are expected, and SCDOT will continue to monitor. Given it takes two years for a project to be completed, it is simply too early to determine if changes need to be made.
Bridges: The bridge program is on target. To date, 81 bridges have been completed.
Rural Road Safety:  The rural road safety program is trending ahead.  With a 10-year goal of 1,000 miles of safety treatment for rural roads, to date, 393 miles are contracted for construction with 115 miles complete.

Interstate Capacity: Interstates are on schedule. A detailed look at the progress to date is outlined below.
2020-2021 Budget Review
Thanks to the recent efforts of the legislature to allocate vehicle-related fees to roads, state revenues now make up 49% of the SCDOT’s budget. The fuel tax, infrastructure maintenance fee (formerly the car sales tax) and DMV fees make up a significant portion of this boost. 
Revenues for the fiscal year 2020-2021 are projected to be flat. The SC Revenue and Fiscal Affairs (RFA) office project a decline in car sales nationwide.  So, while there has been an influx in revenues from the infrastructure maintenance fee, those revenues have likely peaked for the time being.  Fuel taxes are also expected to remain flat, primarily gasoline. Diesel tends to be more cyclical with the economy.
When it comes to expenditures, system maintenance/preservation and capacity/operational improvements will make up 86% of the agency’s spending.  
The budget will be presented to the Commission at the September meeting for approval. View the full 2020-2021 budget review here.
STIB Adopts Economic Development Criteria
The SC Transportation Infrastructure Bank (STIB) Board held a call-in meeting Wednesday to approve changes to the evaluation criteria to include provisions for economic development scoring. You may recall that the application process was recently extended 30 days (scheduled for September 1) in order for the STIB to adopt these changes. 

As of Wednesday, STIB Chairman John White said they have 1-2 applications that they have already received, and he anticipates more to come in. He said he expects an “active and busy fall.”

The STIB Board is working on scheduling a full Board meeting in the next week or so to take care of some household items. The next meeting of the Evaluation Committee will likely be late October after they have had time to review applications. Stay tuned…
Upstate Chamber Alliance Touts Progress on Roads
In a column for the Greenville Business Magazine, Jason Zacher, Vice President of Business Advocacy for the Greenville Chamber of Commerce and the Executive Director of the Upstate Chamber Coalition, revisits why the gas tax was needed in the first place and looks at the progress to date – from the work being done across the state, to the job creation that is taking place. Revenue has increased and work is being done. 

“The third installment of the two-cent tax increase took effect on July 1, and on schedule, our CAVE neighbors (Citizens Against Virtually Everything) have assailed the SCDOT for squandering the gas tax revenue--without merit.

The business community strongly supported the tax increase because crumbling roads were impacting commerce in our state. It was unacceptable that we were consistently ranked among the most-deadly roads in the nation. Load-restricted or closed bridges caused shipments and deliveries to drive miles out of their way, costing time and money. Congestion was delaying employees, customers, and shipments. We knew something needed to be done, and the cost of a 12-cent gas tax increase would be negligible when weighed against the benefits.

Now, we are starting to see the benefits.”

We encourage you to read the full article here.
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