Introduction
Let's talk about money.
North Dakota’s transportation system is a tremendous asset. The system was built by our parents and grandparents who believed investing in transportation was important for them and future generations. Today, it has a replacement value of $14.2 billion and we are charged with determining how we will invest to ensure that is continues to be an asset for generations to come.
Over the past several months, we have talked about customer expectations, priorities and various scenarios North Dakota’s Transportation system could be facing in the years to come.
Now, let’s get down to dollars and cents. We have created this funding tool to help you better understand a few issues in North Dakota:
- How transportation in ND is funded
- How much you are paying to support ND transportation
- What transportation funding challenges ND is facing
- What trends are we seeing in other states that we could implement here
With that information we need your help answering the $694M question:
How would you spend the budget?Click 'Next' below to learn more.
How are we funded?
While more than half of North Dakota’s transportation budget comes from Federal funding, the remainder is split almost evenly between the State Gas Tax and vehicle and registration fees. The majority of federal funds is dedicated to pay for highway improvement project costs. Historically, North Dakota has received $2 of Federal Highway funds for every $1 North Dakota drivers have paid into the Federal Highway Trust Fund.
Your monthly costs
How much do you pay each month?
Select an option from the drop-down menus that is the closest to your driving experience to see how much you pay each month.
How does ND Compare?
North Dakota has increased fuel taxes and vehicle registration fees in the past decades to account for rising construction costs and to keep pace with growth in the state's population, businesses, and visitors using the transportation system on a daily basis. Compared to neighboring states, North Dakota ranks relatively low in terms of fuel tax rates and vehicle fees.
North Dakota’s state transportation revenues are heavily dependent on motor fuel taxes and vehicle registration fees.
Motor fuel taxes are levied per gallon, not per dollar. As fuel economy improves, people buy less gas and the state receives less revenue.
The last time North Dakota state rates were raised was in 2005. The last time Federal gas rates were raised was 1993. The same amount of revenue purchases fewer projects as project costs increase.
How much does transportation cost?
NDDOT’s$694 million budget in 2020 may seem like a big number, but with rising costs of transportation services and construction materials, and more and more travelers on North Dakota's roads and systems, that funding does not stretch as far as it used to.
An Upper Great Plains Transportation Institute Study revealed that investing in our transportation system returns $4.90 for every $1 spent. Transportation is a long-term investment in North Dakota’s economy and communities and supports North Dakota's residents, businesses, and visitors.
North Dakota has more than 8,600 roadway miles on its State Highway System. With simple preventive maintenance costs ranging from $180,000 to $265,000 per mile, 20 to 30 percent of the State Highway Fund must be spent on basic repairs each year. This does not count more extensive repairs for roads and bridges with higher levels of wear-and-tear or weather-related damage.
Our funding challenges
North Dakota’s state transportation revenues are heavily dependent on motor fuel taxes and vehicle registration fees. Motor fuel taxes are levied per gallon, not per dollar. As fuel economy improves, people buy less gas and the state receives less revenue.
To maintain current levels of service the NDDOT provides today would require $24.6 billion over the next 20 years. But at current levels, NDDOT can expect $10 billion in revenue. This equates to a gap of $14.6 billion*.
Move ND, NDDOT’s 10-year infrastructure plan, has identified $2.2 billion in critical investments for the highway network alone over the next 10 years to maintain key system components and minimize freight restrictions.
NDDOT is currently in preservation mode, meaning we focus the majority of our resources on preserving the transportation system as it exists today. While some new projects get built, we are losing ground and our system is deteriorating faster than we have resources to preserve it.
*UGPTI 2018 studyWhat is the future of funding?
Other states are exploring additional options for funding transportation, we will look at three.
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About |
Designed to account for the impacts of ride-share vehicles on the transportation network, such as traffic congestion or additional wear-and-tear on roads. | A common source of revenues for state DOTs around the country, but they are not in place in North Dakota. | Charge drivers for the number of miles they drive rather than the amount of gas they consume. This program is designed to charge people for how much they use the transportation network. |
How does this system work? |
Ride-share sales taxes are placed on trips that people take on ride-share vehicles, such as Uber, Lyft, or taxis. Can be levied as a single value per trip or as a percentage of the trip’s total cost. | Levied on vehicles that serve a commercial or business purpose and qualify for benefits, such as insurance benefits, that come from using a vehicle as part of one’s business. | Participants sign up to enroll in the program and can select from a variety of ways to report their mileage, such as odometer report-outs or GPS-based monitoring systems. Paid on a scheduled or on-going basis. |
Where is this being used? |
 Click or tap the image to enlarge. Learn more |
 Click or tap the image to enlarge. Learn more |
 Click or tap the image to enlarge. Learn more |
How would you pay? |
The amount you pay in ride-share sales taxes would depend on how often you use ride-share options, how far you travel, and when you travel. Current fees range from $0.20 per trip to the sales tax rate applied to the total fare. | Fee is often based on the weight or age of a vehicle when the vehicle’s registration is renewed, or take the form of a special license plate or operating permit, which will have separate costs. Other fee structures have a separate category of commercial vehicle fees, which may be tailored to the type of vehicle, such as a truck, trailer, or specialized machinery. |
In Oregon, a mileage-based user fee pilot program charges 1.8 cents on the mile and provides them with a rebate on their state fuel tax payments. That means if your car or truck gets less than 12 miles to the gallon, you save money compared to the current gas tax! |
Learn More |
www.enotrans.org www.accuratetax.com |
www.ncsl.org dor.sd.gov www.opportunityfund.org |
taxfoundation.org www.fhwa.dot.gov www.codot.gov |
Where should we invest?
NDDOT measures performance on a regular basis so that we invest funds when and where it is needed to maintain the transportation system and meet travelers' expectations. Investments are made to preserve assets in good condition, to minimize future costs, to perform preventative maintenance that limits the risk of future wear-and-tear on asset condition, and to ensure that the system works for you.
The example below highlights the range of outcomes for maintenance and repair activities for state roads and bridges. NDDOT measures road and bridge condition on a regular basis and fixes these roads to maintain performance targets. Today, NDDOT invests enough funding to maintain roads and bridges in fair to good condition. But increased travel and decreased revenue from fuel taxes point towards a long-term decline in the condition and performance of our roads and bridges.
