Delaware’s Department of Transportation (DelDOT) is requesting an 8.3% budget increase from last year due to the end of federal stimulus payments.
DelDOT Secretary Nicole Majeski says for the last four years, the department has been using pandemic-era federal stimulus money to offset their debt service and Delaware Transit Corporation subsidy, but fiscal year 25 marks the end of those funds.
Majeski says the department generally requests around a 4% increase in operating budget costs, but they are now requesting an additional $32.5 million, with 85% going towards covering the debt and subsidy payments.
$300,000 from the requested increase would go towards the McDowell Transportation Center that recently opened in November. Majeski says additional costs are needed to operate and maintain the new facility.
“It has been received overwhelmingly positive. You all know that that was one of the busiest stations that we had – it was a very small station. Now we have a state-of-the-art complex that is ADA accessible and serving our customers well," she says.
The increase in funds would also cover the DelDOT safety program initiatives. Majeski says 2023 saw a 16% reduction in roadway fatalities from 2022, and already this January has seen a 50% reduction in fatalities compared to last year.
The Joint Finance Committee (JFC) also discussed the continued uncertain impact electric vehicles will have on DelDOT's revenue.
Revenue from the motor fuel tax currently makes up 14% of DelDOT’s funding, but the number of EVs is consistently increasing, currently making up 3.5% of all registered vehicles in the state.
Committee member and State Sen. Eric Buckson (R-Dover) is concerned about the effect EV increases will have on revenue traditionally provided by the fuel tax.
“I really think that we need to have at least a model. If we don’t come up with a plan on how to fix it yet, that’s fine, but we better have a model for what a 15% fleet looks like or 25% fleet looks like in the year 2027," he says.
DelDOT Secretary Nicole Majeski says after adoption of the Advanced Clean Car II regulations, the University of Delaware is working on a report analyzing the future impact EVs will have on motor fuel tax revenue.
Majeski says the department expects to receive the data from UD in March.
To make up for lost revenue in fuel taxes, some states have implemented higher registration fees for EVs
According to the Tax Foundation, as of September, 24 states impose a higher annual vehicle registration fee for EVs, ranging anywhere from $50 to over $200.
The Pennsylvania Senate passed legislation in December that would set an EV registration fee at $290, the highest in any state so far. The bill has not yet passed the state's House of Representatives.
JFC Chair State Sen. Trey Paradee (D-Dover) mentioned previous initiatives to look into a mileage-based user fee, which Majeski says is still ongoing.
She says the pilot program is currently in a phase that awaits a national review and she hopes Delaware will be apart of that committee.
"We're a transit state, so we have a lot of people that live here but travel outside of the state for work and vice-versa. So taking all of that into consideration, we've modeled different things, and I think it can be an option, but I don't think it will be the thing that completely replaces [the fuel tax]," she says.
Majeski says in addition to 10% of the Delaware Authority for Regional Transit's (DART) fleet being electric, DelDOT received a grant from the Federal Transit Administration for eight hydrogen buses that will become operation within the next two years.
She also mentioned the department receiving federal funding for additional EV charging stations on Highway 95, Route 1, Route 13 and Route 113. They are currently in the request for proposal stage and hope to award a contract within the next month.
Additionally, DelDOT plans to start construction on a solar project at the Dover Transit Center, installing solar panels to create a microgrid with the ability to charge the department's electric buses.
