Georgia House and Senate lawmakers acted in the final days of the regular session to approve a $900 million per year transportation funding bill that includes a fuel tax increase and a new fee on trucks.
The state’s fuel tax now is a two-part tax. A percentage portion of the tax is calculated twice annually and is based on the average price per gallon of fuel in the state at the time. The excise portion of the tax adds 7.5 cents per gallon – a rate that has remained unchanged since 1971.
House lawmakers voted 129-41 to endorse a plan to convert fuel tax collection in the state to a pure excise tax. The Senate followed suit on a 42-12 vote. The bill, HB170, has moved to Gov. Nathan Deal’s desk for his expected signature.
“We faced obligations that could no longer be ignored, and current resources were simply not enough to preserve the infrastructure we need … to keep the lifeblood of our economy pumping,” Deal said in a news release.
The new law will set the gas tax rate at 26 cents per gallon. The diesel rate will become 29 cents.
The tax increase is expected to raise $700 million for transportation work.
Rep. Jay Roberts, R-Ocilla, has said the funding plan will help the state cover a transportation funding shortfall in excess of $1 billion per year.
“We’ve got to put more money to transportation in this state if we want to move forward,” he said during recent discussion on the bill. “The need is real.”
The change in how fuel tax revenue is collected will also result in about $180 million being rerouted from the state’s general fund to transportation.
Roberts’ bill also calls for the fuel tax rates to be adjusted to inflation. He said the indexing component of the plan provides a reliable, predictable source of transportation funding.
A protection included in the bill would also ensure that fuel tax revenue is applied solely for transportation purposes.
“We are making a fundamental shift in this state. We’re saying as we go forward any and all money collected off motor fuel will be spent on transportation,” Roberts told lawmakers.
Truckers will also be responsible for paying an additional tax, dubbed the “highway impact fee.” Commercial vehicles weighing between 15,500 and 26,000 pounds will be assessed a $50 annual fee. Trucks heavier than 26,000 pounds will be charged $100 per year.
An annual fee on electric vehicles will also be assessed. Affected commercial vehicles will be charged $300 while the registration fee on electric-run personal vehicles will be set at $200.
Another new fee will be collected on visitors to the state. Specifically, a new $5 per night hotel/motel tax estimated to raise $200 million per year will be routed for transportation purposes.
Deal said residents and visitors to the state will quickly see the benefits of the funding deal made by state lawmakers.
“Georgians will soon see the road crews and the orange cones and smell the hot asphalt as it’s poured,” Deal said.
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