Kentucky highway projects could be delayed because of a $112.5 million cut to the state Transportation Cabinet budget.
Gov. Matt Bevin made the cut this week. The Bevin administration said the cuts were necessary because revenue into the state’s Road Fund was lower than expected. The Road Fund is supported by the state gas tax and has suffered over the past year, largely because of a drop in fuel prices.
Ryan Watts, a Transportation Cabinet spokesperson, said the state hasn’t identified specific projects to freeze.
“We’ve been bracing for this reduction. We knew we would probably have had less revenue to work with,” Watts said.
Revenue into the state road fund has dwindled has the state’s gas tax has reaped fewer dollars from low gas prices and fuel-efficient vehicles.
Last year, the General Assembly passed a bill setting the “floor” to the state gas tax at 26 cents per gallon. Yet the state’s official revenue estimate is now $112.5 million lower than previously forecast.
Nearly $62 million of the cuts come from the state’s revenue-sharing program that gives money for city and county roads — these cuts are automatic and required by law to occur to avoid a deficit.
Watts said it’s up to the local governments to determine how to divvy up the reduced revenue.
Bevin also cut nearly $29 million from the state highway fund, a discretionary reduction.
“It could be full construction projects. It just depends on what phase of the project we can eliminate — a design phase, a right-of-way or a utility phase,” Watts said.
The General Assembly’s 2016 session started Tuesday, and legislators may this year take another look at funding for highway projects.
