Ohio's Transportation Budget Takes Shape
And it's often more about HOW money gets spent rather than WHAT it is spent on.
Every two years, largely with the beginning of each new session of the General Assembly, lawmakers in Ohio spend a lot of time discussing the biennial budget. Unlike most local governments, the state budget differs in two major ways. First, the fiscal year starts in July, rather than December. Second, the budget lasts two years and not one. These two changes make budget making in Ohio a bit more different than what one might expect.
And as part of the budgeting process, the state actually undertakes two separate budgets. One for general operating, which usually goes towards services for education, Medicare, prisons and everything else the state does — except transportation. Transportation is covered by a separate budgeting process, which this edition will dive into.
And while one might think a budgeting process talks about what money will be spent, these budget bills also talk a lot about HOW money will be spent. In other words, some of the policies and procedures of how contracts, bids and purchase orders are used. In addition, in the transportation budget, there are always new traffic laws that are introduced that are implemented with the new budget; in other words, the “transportation budget bill”, can often be a catch-all piece of legislation for all sorts of transportation related matters.
Right now, our state’s transportation budget bill is currently being discussed at the committee level and proposes significant changes to the state's transportation infrastructure and management. This comprehensive bill, known as H.B. 54, addresses various aspects of Ohio's transportation system, from traffic control devices to contract bidding processes, along with the dollars to spend on the state’s transportation systems.
One of the most notable changes is the alignment of Ohio's traffic control devices with federal regulations. The bill modifies numerous phrases associated with traffic control devices to conform to the federal Manual on Uniform Traffic Control Devices (MUTCD). This update ensures consistency across the United States, making it easier for travelers to understand and follow traffic rules regardless of their location. The changes include updates to terminology, such as replacing "private road open to public travel" with "site roadway open to public travel," and splitting "private road or driveway" into two separate terms with distinct definitions.
The proposed budget also introduces new provisions for bicycle and public transit vehicle traffic control. With the increasing popularity of cycling, especially in urban and suburban areas, the bill authorizes the use of bicycle symbol signal indications and specifies their meaning. This allows local jurisdictions to control bicycle movement in a manner similar to motor vehicle traffic. The bill also prohibits parking in bicycle lanes, ensuring these dedicated spaces remain accessible to cyclists. For public transit, new signal indications are introduced to govern light rail and mass transit system bus traffic when transitioning from designated lanes or tracks onto mixed-use roadways.
In terms of management and authority, the bill makes several changes to the Ohio Department of Transportation (ODOT) operations. It modifies the approach to employee performance improvement plans, making them discretionary rather than mandatory for unsatisfactory performance. The bill also requires immediate disciplinary action for egregious conduct without a six-month improvement period. Additionally, the procurement authority of the ODOT Director is expanded to include services along with supplies and products, aligning it with the Department of Administrative Services' authority for other state agencies.
The proposed budget addresses issues related to highway use and obstructions. It introduces new regulations for the abandonment of telecommunications and utility structures occupying state highways or rights-of-way. Telecommunications carriers and utility providers are required to submit notifications of proposed abandonment and comply with ODOT's determined course of action. The bill also increases fines for unauthorized commercial activity in highway rest areas and modifies procedures for removing obstructions from state highways.
Significant changes are proposed for ODOT's contracting and bidding processes. The bill makes permanent the authority of the ODOT Director to enter into a special type of contracts known as indefinite delivery indefinite quantity (IDIQ) contracts for highway maintenance, with specific limitations on contract value and duration. It also authorizes ODOT to chip seal or fog seal asphalt surfaces without competitive bidding for smaller projects. The bidder prequalification process is modified, changing the timeline for when contractors must meet bidding capacity and other qualifications. The threshold for determining the form of financial review required for prequalification is increased from $5 million to $10 million.
The proposed budget also adjusts monetary thresholds for construction contract modifications. It raises the limit for increasing quantities in competitively bid contracts without rebidding and increases the threshold for change orders or extra work contracts exempt from these limits. Furthermore, the bill requires the ODOT Director to evaluate and adjust these monetary thresholds every five years based on inflation rates.
Regarding motor fuel taxes, the bill continues the reduced fuel dealer and retailer shrinkage allowances that have been in effect since 2008. This maintains the 1% allowance for fuel dealers (down from 3% in permanent codified law) and the 0.5% allowance for retailers (down from 1%) through the FY 2026-2027 biennium.
As this bill moves through the legislative process, it will be interestinl to monitor its implementation and effects on Ohio's transportation landscape. The proposed changes have the potential to significantly impact how Ohioans travel, how businesses operate within the transportation sector, and how the state manages its vast network of roads and highways.
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