County Road Revenue Forecast: DMV Data – July Update
Executive Summary: Total dedicated road funding is estimated at $404.6 million for FY 2023.
- CFY 2023 SHF Total Estimate $349.6 Million
- CFY 2023 SRS Total Estimate $33.9 Million
- CFY 2023 STBG Total Estimate $20.9 Million
- CFY 2023 USFS Timber Receipts Total Estimate $7 Million
State Highway Fund (SHF) revenue has been recalculated based on 2021 vehicle registration data after carefully reviewing the Department of Motor Vehicles’ (DMV) methodology and Oregon Revised Statutes (ORS). ODOT Economist Daniel Porter provided the following statement:
“After a careful reading of ORS it is clear to ODOT that statute directs us to use the most recently available registration data in the county apportionment calculation. DMV has produced and published a 2021 registration report consistent with the direction in statute to use the December 31st 2021 date. ODOT will implement the 2021 registration data beginning with the August apportionment and use it until the 2022 data becomes available in early 2023.”
Total SHF dollars have not changed since the April 2022 forecast. Most counties will see a small increase in this updated forecast due to the updated vehicle registration data.
Vehicle Registration Counts and DMV Data Summary: The last SHF forecast was the first since 2019 to use updated vehicle registration data to allocate SHF dollars to counties. ODOT has now updated their vehicle registration counts from 2019 to 2021 data after an interruption caused by the COVID-19 pandemic.
Changes in vehicle registration had disproportionately impacted individual Oregon counties. Multnomah County, Washington County, and Clackamas County, have seen a significant decrease in their share of registered vehicles, and subsequently their share of the SHF.
The Association of Oregon Counties and Multnomah County engaged in discussion with ODOT to clarify the validity of the 2021 and 2020 vehicle registration data. A thorough review of ODOT’s methodology and applicable ORS has led to the rerelease of SHF estimates based on vehicle registration data gathered in 2021, which is the most up to date and accurate count.
As a reminder: DMV’s Service Transformation Program counted all vehicles registered during the 2021 calendar year, which failed to account for changes in registration over that time period. To compensate, ODOT estimated vehicle registration numbers in their October update. The DMV has since rerun their 2021 vehicle registration count using their traditional methodology to produce accurate data for the current forecast.
While Total SHF Dollars have not changed, the allocation of those dollars has. Most counties will see a small increase in this updated forecast.
State Highway Fund (SHF) Trends Reminder: County revenues have been adjusted down $8 million (-2.3%) since January as the Oregon Department of Transportation (ODOT) has recalculated their estimate using updated metrics as motor fuels tax revenues declined.
Motor fuels tax revenues have been projected down $23.2 million statewide compared to the October 2021 forecast. In addition to significant decreases in motor fuels tax estimates, trucking weight mile tax is down $1.5 million, while Revenues Collected by DMV are up $2.1 million and expected to return to normal volumes. Motor fuels tax revenue is estimated using fuel prices, passenger vehicle stock, and fuel efficiency. Prices are up, passenger vehicle stock is down, and fuel efficiency is projected to rise, all of which reduce fuel consumption and motor fuels tax revenues.
Surface Transportation Block Grant (STBG) / State Fund Exchange Reminder: STBG estimates have been adjusted down $387,016 (-1.81%) since January as the County Road Program has recalculated allocations using updated metrics. With the passage of the Infrastructure Investment and Jobs Act (IIJA) formula funding for STBG overall is up $4.6 million (26%) over Federal FY 2022 levels.
SRS and USFS Elections and Comparison Reminder: A full policy brief on SRS and USFS elections and estimates are available in the recently released SRS and USFS County Road Revenue Forecasts. The following is a high level summary of the forecast.
Secure Rural Schools (SRS) Program payments are projected to be greater than United States Forest Service (USFS) 1908 Act 25-percent timber harvest payments for all Oregon Counties except for Malheur and Umatilla County. Counties have until September 30th, 2022 to submit allocation elections between SRS Title I, II, and III to the Oregon State Treasurer / Department of Administrative Services (DAS). AOC will distribute more information on submitting allocation elections when made available by DAS.
Counties can elect to receive USFS timber harvest receipts or SRS payments every two years. The next deadline for electing to receive SRS / USFS timber harvest receipts is August 1, 2023 and every odd year thereafter.
Counties have the choice to elect allocation amounts between SRS Title I, II, and III. Counties can elect SRS allocations by submitting paperwork to the State Treasurer. The next deadline for SRS Allocation Elections is September 30, 2022 and every year when authorized by congress. Please note the majority of Oregon Counties elect to allocate 85% of their SRS distribution to Title I, a decrease in this percentage would reduce annual road funding. For FY 21 allocations see ASR-18-01 (page 50).
Secure Rural Schools Estimates: CFY 2023 $33 million.
Congress has taken action to reauthorize the program through the Infrastructure Investment and Jobs Act (IIJA). SRS Payments are authorized for the next two fiscal years and will not be subject to the typical 5% annual decrease. Instead, SRS payments will be increased to the amount from Federal FY 2017 for FY 2022, and FY 2023.
USFS Timber Receipts Estimates: CFY 2023 $7 million
USFS estimates are based on 25% timber harvest receipts (1908 Act 25-percent payments) from Federal Fiscal Year 2016 (County Fiscal Year 2017), which is the most recent county by county data released by the Forest Service. These figures were used to calculate a weighted average of each county’s historic share of timber harvest receipts. Current estimates were created by combining historic shares with statewide receipts from data post 2016. This method is inherently inaccurate, as actual allocations are based on the actual receipts in each national forest and in each county, not a statewide average. This is, however, a fairly accurate proxy based on historical trends. Timber harvest receipts have been consistent since 2016 as demonstrated in Figure 1. A slight decrease in timber harvest sales was observed in FY 2021.
Please note that O&C County payments follow a different process, with different funding sources, requirements, and estimates.
Forecasting Uncertainty and FY 2022-23 Outlook: The FY 2022-23 forecast represents a conservative baseline county funding model estimate approach for dedicated funding budget planning purposes.
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