Gas tax revenues are staying home, too

Robert Houk • Apr 10, 2020 at 12:00 AM

Staying home also means staying off the road.

That’s why the Washington County Highway Department expects to see a decline in its state gas tax revenues in the new fiscal year as a result of the novel coronavirus (COVID-19) pandemic.

Washington County Highway Superintendent John B. Deakins Jr. told members of the county’s Budget Committee on Thursday he expects state gas tax collection to drop by 30% in April. As a result, bridge work could be impacted in the new fiscal year that begins July 1.

“We told people to stay home, so nobody is buying gas,” Deakins said.

Funding Bridge Projects

Highway departments in Tennessee’s 95 counties each get a share of the state’s 26.4-cents-per-gallon tax on gasoline. Much of that funding come through the IMPROVE Act, which included a 6-cent increase to the gas tax passed by the state General Assembly in 2017.

The act funds road projects and bridge repair and replacement projects statewide. Those grants cover 80 percent of the cost of the work, with counties picking up engineering costs.

“We are preparing for a hit,” Deakins said in reference to revenues in the new budget.

His department has budgeted $8.3 million in the upcoming fiscal year, as opposed to the $8.9 million originally projected. 

Deakins said gas tax revenue will rebound after the pandemic.

“It will take time,” he said. “We don’t know when that’s going to be.”

Recycling Markets Decline

The Budget Committee also heard from Charlie Baines, who heads the county’s solid waste department. Baines said the solid waste fund is looking at a projected $200,000 shortfall in the new fiscal year. Revenues are budgeted at $1.332 million, and expenditures are estimated to be $1.647 million.

He said the markets for recyclables have “fallen off” in the past year.

“We used to be able to sell metals and cover our salaries,” Baines said. “Now it’s rock bottom.”

To make matters worse, Commission Chairman George Matherly said commissioners shifted a penny on the county’s property tax rate from solid waste to county schools. He said that penny was never returned, as promised, and the solid waste fund remains at 3 cents on the tax rate. 

“The bottom line is we have to fund solid waste,” county Mayor Joe Grandy said. “It’s a critical service to our community.”

The county’s solid waste department operates five convenience centers and a tire recycling center.

County Trustee Rick Storey also told committee members his office has collected 94.6% of the county property taxes for the 2019-20 year. He said just over 3.8% remain delinquent.

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