Pennsylvania one step closer to 28-cent fuel tax hike?

By Keith Goble, Land Line state legislative editor | Tuesday, June 04, 2013

An effort in the Pennsylvania Senate to raise $2.5 billion to fund transportation continues to move forward.

The Senate Appropriations Committee voted unanimously on Monday, June 3, to advance to the full Senate a long-term funding package that would help pay for roads, bridges and transit throughout the state. The Senate Transportation Committee already voted 13-1 to approve the bill that could result in a 28-cent increase in the state’s fuel tax rate.

Senate Transportation Chairman John Rafferty, R-Montgomery, has called on state lawmakers to act now to improve public safety and economic development.

“We can’t put off projects. The time to address our infrastructure needs is now,” Rafferty said in previous remarks.

His plan would raise $2.5 billion by the third year. Most of the new annual revenue would come via ending a cap on a tax on wholesale fuel prices.

The change was touted in 2011 by an advisory commission to the governor on transportation funding. The Transportation Funding Advisory Commission estimated a $3.5 billion annual shortfall in funds needed for roads, bridges and transit.

Lifting a cap on the oil company franchise tax could increase the per-gallon tax on fuel about 28 cents over three years because the companies are expected to pass along much of the increase to consumers. Currently, the tax applies only to the first $1.25 per gallon of the wholesale price.

Eliminating the cap on fuel prices now exceeding $3 per gallon would go a long way to help the state raise about $1.9 billion annually for roads and bridges. About $510 million would be applied to transit while airports, ports, rail and bike routes would claim another $115 million.

Rafferty said the bill would allow the state to repave highways and refurbish bridges, as well as expand infrastructure.

Other changes include phasing out Act 44. The six-year-old law requires the Pennsylvania Turnpike Commission to route $450 million annually to the state for roads and bridges.

Another part of the plan would impose surcharges on traffic violations and tie the fees for licensing, registration and permitting to inflation.

Ticketing for traffic offenses that affect insurance would have a $100 surcharge attached. Offenses that don’t affect insurance would be increased between $100 and $300.

The next stop for the bill – SB1 – is the Senate floor. If approved there, it would move to the House for further consideration.

OOIDA encourages Pennsylvania truckers to be involved in the legislative process.

To view other legislative activities of interest for Pennsylvania, click here.

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