Montana House panel tables effort to increase gas tax

By Keith Goble, Land Line state legislative editor | 2/10/2015

An effort to increase Montana’s gas tax rate for the first time in 21 years has been turned back at the statehouse.

The House Transportation Committee voted to table a bill to raise the state’s 27-cent-per-gallon gas tax by 5 cents to benefit local roads and public transportation. The state’s 27.75-cent diesel tax rate would have remained unchanged.

The move to table HB275, following a public hearing to address the issue, effectively kills the bill for the year. During the late-January hearing, multiple groups testified about the need for a bigger tax increase and for the higher rate to be applied to diesel.

As introduced, the bill from Rep. Nancy Wilson, D-Missoula, would have raised an estimated $25.08 million more each year via the gas tax, according to the Montana Department of Transportation.

HB275 allotted 3 cents of the increase to counties, cities or towns for local road and street repairs – $15.05 million. Revenue from the other 2 cents would be allocated to match federal funds for public transportation – $10.03 million. If federal grant funds are not available, the allotment would be rerouted to the state DOT.

Cary Hegreberg, executive director of the Montana Contractors Association, told the panel the effort to increase the tax rate at the pump is a good start but that it falls short of what is needed. He called for a 10-cent rate increase for gasoline and diesel purchases.

Hegreberg said the majority of revenue should also go directly to the state DOT “for state funded construction projects that address a variety of needs around the state.”

“Spook” Stang, executive vice president of the Montana Motor Carriers Association, agreed that the bill didn’t do enough. He asked lawmakers to pursue a study bill to “force the Legislature to sit down and look at investment in our infrastructure.”

“We don’t want to sit (the issue) down and have it kicked down the road for the next 21 years.”

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