Nevada Gov. Jim Gibbons signed a bill into law that will cover 20 percent of the state’s shortfall in road funding. A provision that would have boosted taxes on truckers was removed before the bill was sent to the governor.
The new law, previously AB595, will add $1 billion to ease gridlock on certain freeways without raising taxes. The bill will help eat into a $5 billion shortfall in long-term funding for transportation projects, the Reno Gazette-Journal reported.
The bill diverts rental car and property taxes, as well as hotel room taxes in Las Vegas. The diversion amounts to more than $234 million annually for major road work within the next 10 years.
The money will finance $1 billion in bonds for improvements to Interstate 15 and U.S. 95 in the Las Vegas area and Interstate 80 near Reno. The bulk of the funds will stay in southern Nevada.
An earlier version of the bill called for adding a weight-distance tax of 15 cents per mile for many large trucks. The tax would have affected trucks weighing more than 55,000 pounds, including local garbage trucks and cement haulers, the Ely Times reported.
The weight-distance tax could have generated $1.3 billion through 2015.
Supporters said imposing more tax on the trucking industry is a better way to fund road work than fuel taxes. The charges more accurately reflect the wear and tear on roads caused by individual vehicles, they said.
Opponents said truckers already pay 40 percent of the fuel taxes and fees that fund transportation in the state. They also said a weight-distance tax would make Nevada the most expensive state in the union for the trucking industry to do business.
Gov. Jim Gibbons shared that concern. He is opposed to traditional funding methods for roads that include tax and fee increases.
The governor said taxing the trucking industry would inevitably raise consumer prices for goods delivered by truck. He said it also could hurt the state’s business-friendly climate, the Las Vegas Review-Journal reported.