Department of Safety Assistant Commissioner Steve Lavoie and Department of Transportation Commissioner Bill Cass briefed the House Transportation Committee on state transportation revenues and funding risks, saying the highway fund has been structurally short for at least three biennia and that revenue pressures may require legislative choices.

Lavoie told the committee the highway fund is constitutionally limited to “the construction and maintenance of public highways, and then also for the supervision of traffic thereon.” He noted that certain collection costs and DMV fees are deducted “off the top” before deposits are available for the fund’s restricted purposes.

Lavoie said about half the revenue the department collects comes from the road toll (the gasoline tax) and the new electric-vehicle surcharge, and that “we’ve had a structural deficit in the highway fund, for at least the last 3 biennium,” requiring transfers from the general fund to maintain required service levels. He warned that future ability to transfer general funds may be uncertain and that fiscal notes attached to bills will reflect highway-fund impacts.

During questions, Commissioner Bill Cass and department staff described recent policy steps to adapt to declining gasoline-tax revenues as vehicle fuel efficiency and EV adoption increase. Representative Dan Bayou asked for clarification about the electric-vehicle surcharge; the transcript records a committee exchange in which one witness identified the surcharge amount as "$100 for electric vehicles and $50 for hybrid electric vehicles," and Commissioner Cass estimated those charges generate about $2 million.

Cass described broader fiscal and operational challenges at DOT including inflation-driven construction-cost increases, a long-running vacancy rate and limits on matching federal funds: “We are getting done what we have to get done, but we aren't getting done everything that we should be because of the vacancy rates.” He said highway-fund sustainability will be a long-term question as fuel efficiency improves and EVs become more prevalent.

The agencies asked the committee to consider fiscal notes and funding implications when drafting legislation and to account for the highway fund’s restricted uses when proposing changes that would affect DOT or Department of Safety operations.