Another lawmaker proposes gas tax hike

Friday , February 28, 2014 - 12:08 PM

Antone Clark, Standard-Examiner Correspondent

SALT LAKE CITY — Claiming the current setup forces potential state education funds to be used to subsidize transportation, yet another state lawmaker is stepping forward with a proposed increase in the state gas tax.

Sen. Jim Dabakis, D-Salt Lake City, who is head of the state Democratic Party, said he will run legislation during the coming session to raise the gas tax and index it to inflation.

His proposal, which is still being drafted, is one of at least three measures aimed at potentially raising the state’s tax on gasoline during the session, which convenes for 45 days beginning Jan. 27.

“Transportation steals from education. It needs to be funded by the users,” Dabakis said of his proposal. “Funding for schoolchildren is building our roads.”

He said there is no specific percentage increase in the proposal at this point, but any possible hike from the tax of 24.5 cents per gallon would be indexed to inflation. Dabakis thinks a gas tax hike could add from $100 million to $150 million a year to state coffers.

One proposal widely discussed since last summer is legislation to give counties the ability to impose a 3 percent fuel tax, with revenues going to cities and towns in their borders. The bill, pushed by the Utah League of Cities and Towns, does not have an announced sponsor.

The local option and the Dabakis proposal are not the only gas tax options being discussed.

Rep. Jim Nielson, R-Bountiful, said he is ready to throw another couple of options into the mix, with bills proposing a tax increase on all fuels, including compressed natural gas, and another measure indexing the fuel tax.

Nielson’s legislation would raise the tax on fuel from 24.5 cents per gallon to 26 cents on July 1, then raise it another 1.5 cents each year until 2018. It would also add a half-cent increase each year to the cost of CNG over a six-year period.

Nielson estimates his plan would generate an additional $22 million in revenue in its first year.

Discussion of a possible gas tax increase comes on the heels of a state transportation summit where officials identified $54 billion in needed maintenance and road projects between 2014 and 2040, with an estimated shortfall of $11 billion to meet those needs.

The state’s gas tax has not been raised for 17 years, and growth and more-efficient vehicles have increased needs and diminished the revenue stream to address those needs.

Veteran GOP lawmaker Sen. Kevin Van Tassell, R-Vernal, says the conflict can’t be kicked down the road much further.

Even representatives of the business community have gotten into the discussion. Dave Davis, president of the Utah Food Industry Association, said state leaders need to consider a uniform tax rate across the state.

Sen. Lyle Hillyard, R-Logan, a veteran of more than three decades in the Legislature, has predicted no tax increase will be passed in 2014, unless it is pushed by Gov. Gary Herbert. He also noted it will be tough to get a tax hike passed in an election year.

Herbert has urged a discussion of the tax option but has not openly supported it.

Dabakis said he is not content to wait for the governor’s support to move forward with a gas tax. “The governor’s support would be helpful, but I don’t count on it.”

He criticized the governor for dithering on many leadership issues and failing to take a position for or against a bill.

Sign up for e-mail news updates.