The South Carolina Department of Transportation (SCDOT) released Tuesday the initial COVID-19 financial impact projections of COVID-19, indicating decreased revenues through reduced gas tax and car sales tax receipts.
The analysis found that lower traffic volumes and a drop in car sales in the state are expected to result in a $78 million revenue reduction during the period April through July 2020, forecasting $54 million less in gas tax revenue and a $24 million decrease in vehicle sales taxes through July 2020.
“We expect traffic volumes to continue to climb as the state emerges from the pandemic, and we expect the revenue gap to close over time,” South Carolina Secretary of Transportation Christy Hall said. “Like everyone else trying to forecast the economic impact of this virus, it is unknown whether it will take six months or more than a year for revenues to return to pre-pandemic levels.”
Hall said the agency is currently conservatively planning for a longer recovery period lasting as long as two years, with a potential $293 million total impact. She said the projection would be updated as developments through July unfold.
Hall has reduced SCDOT’s internal operating budget by 11 percent for the remainder of this state fiscal year to meet the lower revenue forecasts and ensure all other mission-critical operations continue as planned.
“We are confident that the planning and preparation we have done will allow us to manage through this with no disruption to our core priorities, including the road and bridge projects currently under construction,” Hall said. “We will closely monitor the situation over the next several months and plan to continue to advance our road and bridge program aligned to the revenue stream.”