West Virginia adopts road revenue package; Oregon and Wisconsin not giving up

By Keith Goble, Land Line state legislative editor | 6/26/2017

Elected officials from coast to coast are making strides to raise revenue for transportation work.

The Owner-Operator Independent Drivers Association believes that when there is a valid need to generate additional revenue, increasing fuel tax rates is the most equitable way to accomplish that goal. Mike Matousek, OOIDA director of state legislative affairs, points out that any increase should be applied equally to both gasoline and diesel. He adds that safeguards are also necessary to keep the additional revenue for roads and bridges.

In West Virginia, Gov. Jim Justice signed into law a bill to raise fuel taxes and vehicle fees. The changes take effect on Saturday, July 1.

Approved during a special session, the plan raises the state’s fuel tax rate by 3.5 cents. Specifically, the variable component based on wholesale price increases from a minimum of 11.7 cents per gallon to 15.2 cents. The flat portion of the fuel tax will remain at 20.5 cents

The motor vehicle sales tax, or privilege tax, will be raised from 5 percent to 6 percent.

Various fees imposed by the state Department of Motor Vehicles will also be increased.
In all, the tax and fee increases are estimated to raise about $130 million yearly.

The governor was very pleased to announce the roads deal.

“We passed an incredible roads package,” Justice said at the bill signing ceremony. “It is truly landmark, and what it will do for our state is unbelievable.”

“It will be nice to think about putting a whole lot of orange barrels out there.”

The new law also includes authorization to put a question before voters this fall to allow the Department of Transportation to sell nearly $2 billion in bonds for certain projects throughout the state.

Some Oregon legislators are advocating for a 10-year, $8.2 billion transportation package. Potential funding provisions cover new taxes and fees, including tolls.

Gov. Kate Brown has said she wants to get a transportation funding package through the Legislature.

HB2017 includes a sales tax on new vehicle purchases, and higher vehicle title and registration fees.

A 14-cent increase in the state’s 30-cent fuel tax rate is also part of the plan. An initial 6-cent increase in 2018 would be followed by 2-cent increases every two years through 2026.

Half of the fuel tax revenue would be allotted for state transportation work, 30 percent would be routed to counties, and the rest would be sent to cities.

The tolling provision is billed as a solution to raise revenue and to discourage people from driving during rush hour in the Portland area.

Lawmakers are hopeful of getting a deal done. To win approval at the statehouse, a three-fifths majority would need to favor the tax bill.

There remains a possibility that voters would make the final decision on any plan to raise taxes and collect tolls.

Wisconsin lawmakers are all over the board when it comes to revenue enhancers. Assembly Republicans are advocating for maneuvers in the state’s fuel tax collection to raise additional revenue for transportation purposes. Tolls are also on the table.

The state’s fuel tax rate now is set at 30.9 cents.

The $660 million GOP plan calls for adding sales tax to fuel purchases. Currently, fuels are exempt from the state’s 5 percent sales tax.

In exchange for charging a new tax on fuel – equivalent to 12 cents per gallon, the excise rate would be reduced by 4.8 cents.

According to a legislative analysis of the plan, after the tax maneuvering consumers would end up paying an extra 7.2 cents per gallon.

Counties would also be allowed to add a one-half percent sales tax to pay for local roads.

The Wisconsin Department of Transportation would also be directed to ask for a waiver from federal requirements covering tolls on existing highways.

Gov. Scott Walker, a Republican, and his party leaders in the Assembly have been in disagreement over what to do about a projected $1 billion shortfall in the state’s transportation fund. The governor has called for delaying work and borrowing $500 million, as well as rerouting general funds to roads.

Another option floated by Rep. Amy Loudenbeck, R-Clinton, calls for professional drivers to do the heavy lifting to pay for transportation work.

In an effort to avoid toll roads, her plan would place a per-mile fee on large trucks.

Only four states collect per-mile fees on truckers: Kentucky, New Mexico, New York and Oregon.

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