Motor Fuel Tax Funds

By JOHN W. McCREE
Illinois Department of Transportation

Motor fuel tax revenues experienced a modest increase during calendar year 1988. This increase was simply due to the fact that fuel consumption was slightly higher than in 1987. Without additional revenues from a motor fuel tax increase, we can expect to see very little change in allotments to local governments each year as long as fuel consumption remains essentially constant. Unfortunately, the buying power of motor fuel tax revenues is continuously eroded by the consumer price index rate of change, which was 3.7 percent in 1987.

Recent history has indicated that fuel consumption has been significantly influenced by the Corporate Average Fuel Economy (CAFE) standards mandated by Congress in 1978. The steady influx of more fuel efficient vehicles brought about by CAFE along with vol-

MOTOR FUEL TAX ALLOTMENT STATISTICS (Distribution in CY 88)
			% of change from 1987
Motor Fuel Tax		$736,581,965.55
Sales Tax		92,973,834.92
GROSS COLLECTIONS		$829,555,800.47	+ 5.69
DEDUCTIONS
Vehicle Inspection Fund .....................	$ 16,823,265.41		- 21.22
Secretary of State ...........................	590,700.00		+ 47.42
State Construction Fund .....................	261,565.165.91		+ 5.85
Transferred to Road Fund ...................	31,037,739.58		+ 5.61
Highway Administration .....................	6,565,341.57		+ 7.28
Revenue Administration .....................	12,661,572.33		+ 8.75
Refunds....................................	17,768,664.51		- 4.84
State Boating Act Fund ......................	4,032,000.00
	$351,044,449.31	$351,044,449.31
		$478,511,351.16
ALLOCATIONS
Dept. of Transportation (Road Fund) .........	$130,953,427.42	$130,953.427.42	+ 7.69
Less Grade X-ing Fund ......................	12,000,000.00
	$118,953,427.42
Municipalities ..............................	$170,638,228.82		+ 7.07
Counties over 1,000,000 pop. .................	58,176,939.14		+ 7.07
All other Counties...........................	63.504,902.71		+ 7.07
Road Districts ..............................	55,237,853.07		+ 7.07
	$347,557,923.74	$347,557,923.74
		$478,511,351.16

January 1989 / Illinois Municipal Review / Page 7

untary fuel conservation on the part of the user negatively impacts fuel consumption, meaning less revenue will be available for distribution. This depicts a bleak forecast for future MFT allotments. The need for additional revenue is clear if the state and local highway systems are to be maintained at acceptable levels.

Gross collections, which included $92,973,834.92 in sales tax revenue, were 5.69 percent above calendar year 1987. This, along with a reduction in the cost of administering the Vehicle Inspection Fund, resulted in a 7.07 percent increase in all local agency MFT allotments. Approximately 11.5 cents of every dollar local governments received during 1988 was a direct result of the 2.5 percent of the sales tax deposited in the motor fuel tax fund each month.

The chart shows Illinois' motor fuel tax revenue disbursements in calendar year 1988. Municipalities received $17.50 per person, up from $16.42 last year. Road Districts received $772.22 per mile, up from $723.79 last year. Counties received their allotments based on registered license fees for the previous year.

Each month motor fuel tax allotments vary with the total monthly motor fuel tax collections (including the sales tax) which are deposited in the State Treasury. Should you have questions concerning your motor fuel tax allotment or not receive your monthly allotment by the end of the following month, please call Frank McCarthy in the Bureau of Local Roads and Streets in Springfield at (217) 785-5179. •

Page 8 / Illinois Municipal Review / January 1989