If state lawmakers suspend Ohio’s gas tax for 90 days as they plan to do next week, it’s estimated to cost around $700 million. The tax of 38.5 cents on gasoline and 47 cents on diesel is critical to road construction and repair. Both candidates for governor have called for a gas tax holiday, with the Republican being more specific about how that money would be made up.
Vivek Ramaswamy has said the record-high price of diesel spurred him to bring Republican leaders together on his gas tax suspension plan, which was announced about six hours after his Democratic opponent Amy Acton called for a gas tax holiday, without any specifics. Ramaswamy said the lost revenue would be covered by unspent Ohio Department of Transportation and general revenue funds, and the rainy-day fund if needed.
“Revenue receipts are $1.6 billion ahead of projections," Ramaswamy said at a press conference on Wednesday, where he and legislative leaders announced some details of his plan. "That's a privileged position to be in, but being in that privileged position, we also have a responsibility, not just a privilege, but a duty and a responsibility to use that to deliver relief and help when Ohioans need it the most.”
"By keeping the state on solid financial footing. Ohio has options to provide temporary relief without reducing necessary services," said Rep. Jim Thomas (R-Jackson Twp.), who will be one of the bill's joint sponsors once it's introduced. "We will replace the lost revenue for local governments and the state highway funds, and so they will all be made whole."
Senate President Rob McColley (R-Napoleon), who is Ramaswamy's running mate, said he thinks it's possible to fund the gas tax suspension without touching the rainy day fund. And Speaker Matt Huffman (R-Lima) said ODOT has some funds that are available.
“There is at the moment more money in the fund to build and take care of roads and all of that than typically the state would need," Huffman said. "The two crucial pieces of this is we're going to have relief at the pump for Ohioans, and we are going to have a continue to have our road maintenance and building taken care of. So I'm not sure why anybody would even think that this is a hard vote or that Gov. [Mike] DeWine would reject it."
But the state said that may not be the case.
The Office of Budget and Management said in a statement: “ODOT’s largest fund is Fund 7002, the Highway Operating Fund. The cash balance in that fund today is just under $1.6 billion and the balance fluctuates daily. It supports $5 billion open purchase orders for operations, maintenance, and capital improvements. There is no money in the account that is not planned for future projects."
As for the general revenue fund, OBM reported a revenue surplus of nearly $1.8 billion over estimates at the close of the fiscal year in June. But around $1.2 billion of that has been allocated through House Bill 479 to a nursing home settlement, a one-time credit for those receiving the homestead tax exemption, an expanded 15-day sales tax holiday next August and other expenditures.
DeWine, who had said a gas tax suspension proposed earlier this year would be "a very grave disservice to the people of the state of Ohio", hasn't said what he'll do about this plan.
"I want to see the full proposal," DeWine told reporters at the Farm Science Review on Monday. "As I heard about it, I picked up the phone and we called ODOT, for them to start giving us their data that we're going to need. And look, it's important that there'll be a public discussion of this. Obviously, it's important that people have the facts."
Huffman said the legislature will come back into session on Sept. 30 to consider the gas tax holiday. So far, neither the House bill nor its companion Senate bill have been formally introduced.
