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DelDOT projects tighten as fuel‑tax prospects and paving backlog reshape FY26 plan
Summary
Delaware Department of Transportation officials told the Joint Finance Committee they face longer‑term revenue pressures from declining fuel revenues, requested a $464.7 million FY26 operating plan and outlined capital priorities including neighborhood paving, microtransit expansion and electric bus microgrids.
The Department of Transportation told the Joint Finance Committee the state’s transportation finances will face pressure in coming years from stagnant motor‑fuel tax receipts and rising operating costs, and presented a FY2026 operating request that totals about $464.7 million.
A senior DelDOT presenter (identified in the hearing as the department secretary) summarized the department’s mission and highlighted safety priorities including median barriers, pedestrian improvements and additional work‑zone speed enforcement. The department reported fiscal‑year totals showing roughly $1.05 billion in Trust Fund sources, with revenues coming from tolls, motor fuel tax, DMV receipts and federal sources.
DelDOT’s operating budget request includes debt service, the Delaware Transit Corporation operating subsidy, personnel costs and operating adjustments. The agency said its FY26 recommended operating request is $464.7 million — a year‑over‑year operational increase of about 1.7 percent after accounting for contract settlements, debt service changes (including scheduled increases tied to US‑301 financing) and other adjustments presented to the committee.
Lawmakers pressed DelDOT on several fronts: staffing and recruitment, DMV transaction backlogs, plan‑review fees, neighborhood paving priorities and the department’s long‑term revenue outlook.
On staffing, DelDOT reported vacancy rates that vary by function — equipment operators, mechanics, engineers, DMV front‑line staff and transit drivers — and described recruitment programs, expanded internship pipelines and classification reviews to improve retention and pay competitiveness. The department said it converted many casual seasonal positions but did not proceed with further casual‑to‑full‑time conversions after the governor’s operating guidance limited new recurring operating spending.
DMV: DelDOT officials said they have substantially reduced dealer‑title processing delays and expanded an online portal for dealers. Average in‑office DMV wait time was presented at roughly 27 minutes, with work under way to expand online services and mobile “DMV on the Go” events.
Plan review and fees: The State Fire Marshal and the department each discussed plan‑review user fees. DelDOT briefers noted those fees and a long‑standing $25 permit cap for some categories date to older legislation; DelDOT and several legislators urged a statutory review because the $25 cap has not kept pace with administrative costs. The department also noted that some classes of applicants (schools, local governments and others) are statutorily exempt from plan‑review fees.
Paving and capital: DelDOT said the statewide neighborhood paving program (SSPMF) has funded hundreds of locations and that after the current fiscal year the department expects to have addressed the worst (very poor) corridors. The department also described a $575 million FY26 capital program request that covers the largest projects in the Transportation Trust Fund. Officials said some capital timing has been stretched because of operating pressures in previous years.
Transit and clean‑fuels investments: DelDOT and the Delaware Transit Corporation described ongoing work to add battery and hydrogen buses and related charging and hydrogen facilities. John Sisson of DTC discussed an awarded Federal Transit Administration grant to build a microgrid at the Dover garage: solar panels plus battery storage to charge electric buses and reduce energy cost volatility.
Revenue outlook: Presenters noted the motor‑fuel tax is flat in their near‑term projection and that increased fuel efficiency and adoption of alternative vehicles will reduce fuel‑tax receipts over time unless the state takes action. DelDOT intends to pursue a mix of options — revenue adjustments and capital‑program prioritization — and said it will present legislative options and finance alternatives for consideration.
Committee members asked about speed‑camera warnings, E‑ZPass vendor performance, the toll stabilization fund (DelDOT said the Route‑1 toll stabilization fund will be fully funded in FY26), and planned microtransit service expansions. The department agreed to follow up with committee staff on several items, including the distribution of exempt plan reviews and details about specific project timelines.
