RCOC Provides Troubling Financial Picture

Staff | September 28, 2010

Road Commission for Oakland County (RCOC) Managing Director Brent Bair reported at a Board of Road Commissioners meeting that the agency experienced one of its most expensive winter road maintenance seasons ever this past winter. He also pointed out to the RCOC Board that this fact, combined with the continued decline of state road funding, is creating a troubling financial picture for RCOC.

Bair said the total cost of providing winter road maintenance over the past winter, including plowing, salting, grading roads and staffing, was $12.04 million. The next most expensive winter season in recent memory was that of 2004/2005, which cost RCOC $9.42 million.

At the same time, the two main sources of road maintenance dollars in Michigan, the state-collected gas tax and vehicle registration (license plate) fee, were both down for the first five months of fiscal year 2008 (October through February). Gas tax revenues were down 2.4 percent statewide for this period, while vehicle registration fee revenues were down 2.7 percent.

State-collected road funds were down 1.5 percent in fiscal year 2007 as well after being essentially flat for the preceding eight years.

RCOC receives no revenues from property taxes and relies almost exclusively on the state gas tax and vehicle registration fees for its operating expenses.

Given the sharp increase in winter maintenance costs and the decline in funding, as well as skyrocketing costs in virtually all of the materials needed to maintain roads (from fuel and asphalt to the steel used in sign posts and guardrails), RCOC must cut $2.007 million from its current budget, though this number could be higher if state funding continues to come in below projections. Some cuts have already been made, and others are expected, Bair reported.

"We currently have 18 vacant positions that we can't afford to fill," Bair said. "It's clear that we'll need an even greater reduction in workforce by September 30 — the end of our budget year — in order to balance our fiscal year 2008 budget."

Bair added it is his hope that the agency will be able to achieve the needed work force reduction through attrition, as employees retire.

"We have already reduced roadwork due to our financial shortfall, such as asphalt resurfacing and concrete repairs to eliminate potholes," Bair stated. "Now, with a reduced workforce, we will be forced to provide a lower level of winter maintenance next winter and less other routine road maintenance from now on."

Additionally, the managing director noted that the funding problem is not unique to Oakland County. "Road agencies across the state are hurting," he said. "Some road commissions have laid off staff. Others have turned paved roads into gravel roads, because they can't afford to resurface the crumbling pavement. Other road commissions stopped plowing snow on weekends, except for emergencies, this past winter.

"We are in the midst of a road funding crisis in Michigan, and things will only get worse in the coming months and years, unless we provide more money for roads. That means more roads will be pothole-filled and fewer road maintenance services will be provided."