Jeremy Alford and David Jacobs: Will DOTD overhaul mean more gas taxes?

With Gov. Jeff Landry directing an aggressive overhaul of the state transportation department, highway advocates and policy hawks wonder if new revenue streams could be next.
The Department of Transportation and Development is as massive as its mission, soaking up nearly $741 million in annual appropriations while employing a small army of 4,000 people. DOTD is charged with ensuring citizens and businesses can safely travel a state spanning 43,000 square miles, which doesn’t include the coastal waters connected to the ports underneath the department’s regulatory umbrella.
The gig is getting harder, not easier. Inflation has invaded every corner of DOTD’s mission as projects pile up. In fact, when Transportation Secretary Joe Donahue became the highway czar at the beginning of the year, he inherited a backlog of road and bridge projects totaling $19 billion. (To add perspective, the backlog is 25 times larger than DOTD’s average annual appropriations.)
No wonder Landry wants a comprehensive review of the entire department, and recommendations for how it can be retooled. Landry tapped an industry group, Louisiana Coalition to Fix Our Roads, to manage the review. The coalition selected— and is paying for — Boston Consulting Group to do the heavy lifting.
Consultants are already interviewing DOTD staff and observing operations. Recommendations are due at the turn of the New Year, just in time for the 2025 regular session, which will be fiscal in nature. 
Erich Ponti, president of the Louisiana Coalition to Fix Our Roads, recently told his membership that “it is our objective to move as quickly as possible and to get DOTD into a position where the Legislature will see fit to raise substantial revenue for roads and bridges soon.”
Naturally, minds go to the 20-cents-per-gallon state gasoline tax, which doesn’t raise enough money to fund Louisiana’s infrastructure needs, according to the Legislative Auditor. Plus, better fuel efficiency and the development of electric vehicles are eroding the value of the tax, which is the Transportation Trust Fund’s primary revenue source. 
Despite the obvious need, the Capitol’s politics may not be a good fit for a conversation about increasing a tax.
“I’m not willing to even consider increasing what people pay until we can prove to the people that what they currently pay is being effectively used,” said House Transportation Vice Chair Bryan Fontenot. 
The 2021 version of LSU’s annual Louisiana Survey, meanwhile, which was taken when gas tax rates were a hot topic at the Legislature, found that 57% of residents supported raising the tax to fund transportation infrastructure, favoring maintenance of existing roads and bridges (67%) over expanding capacity (29%).
If a substantive conversation about transportation revenue does take place next year, lawmakers may be more open to addressing the gas tax, or just cashflow in general, if it’s part of a larger package of ideas. 
“I do not think that raising the gas tax is the sole means of providing the appropriate level of funding for the department,” DOTD Secretary Joe Donahue said. “I am not opposed to having an increase be part of a broader plan to get to the level of funding that is necessary.” 
He said eliminating the sales tax exemption, which would require a constitutional change, could help. Unlike the static gas tax, sales tax revenues rise with inflation, he noted.
“I would like to see a substantial source of recurring revenue that is not tied to gasoline fuel,” Donahue added. 
Tolls are another option for generating dollars, but many drivers despise tolls — even more than taxes. Some transportation policy wonks call for replacing fuel taxes with per-mile fees, though implementing that system would be a technical challenge and raise privacy concerns. Just imagine the conservative House debating whether the government should “track” where you drive.
“We’re going to be largely opposed to tax increases given the size of the state budget,” said Daniel Erspamer of the Pelican Institute for Public Policy, which generally calls for lower taxes and spending restraint. “But before we can even talk about adding revenue, we have to solve the structural challenges of DOTD and its budget.” 
Part of the problem, he said, is that DOTD gets dedicated funding from the gas tax, so lawmakers don’t scrutinize its budget as closely as general fund spending. 
Asked to weigh in, House Transportation Chair Ryan Bourriaque said, “We can all agree we have an issue with maintaining roads and bridges in this state. Whether that’s a fiscal issue solely, a planning issue solely, a communication issue… I think it’s a little bit of all of it.” 
Senate Transportation Chair Patrick Connick praised Landry’s decision to review the department. He said he plans to call a meeting later this month to have DOTD officials discuss where things stand. He said he would not support raising the gas tax, at least for now. 
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