February 16, 2005
Support for gasoline tax increase

House Speaker Tom Craddick has thrown his support behind an effort to prevent the state's gas tax from eroding over time.

The tax, last increased in 1991, is a major revenue-raiser for highways and the public schools, but the state hasn't cashed in on the high gasoline prices of recent years because tax revenue which is based on quantity, not price has been relatively flat.

Nor has the tax kept pace with increasing costs of highway construction, prompting the state to begin promoting more toll roads in urban areas, even in the face of public opposition.

The tax is expected to raise almost $3 billion this year, with three-fourths of the revenue going to highways and one-fourth to education, as required by the state constitution.

But the Texas Department of Transportation has said that won't come close to meeting the state's growing highway needs. The agency has estimated a tax increase of about $1 per gallon would be necessary to close that gap, a level that still seems out of the question politically.

According to Corridor Watch, Texas' 20 cents per gallon gas tax is tied for 36th highest in the US. Raising it by a nickel would still keep Texas in the middle of the pack (tied for 18th highest), while raising it a dime would put us in the top ten but still less than high-population states like Florida, California, and New York.

Looking at that chart strengthens my belief that TxDOT's assertion of the need for a dollar increase to adequately handle road construction is absolute baloney. No state has anywhere near that level of taxation. Further, if the current 20 cent tax brings in about $2.2 billion per year for roads (75% of the $3 billion cited above), a tax rate of $1.20 would bring in $13.2 billion per year. That's more than double what Cintra is spending to build the PerryPike, and it's a seven-year project. Hell, at that rate the state could fund the entire Trans-Texas Corridor in a little more than a decade, and it's supposed to be a fifty-year plan. This is a total red herring, and someone should call TxDOT out on it.

Anyway. Governor Perry and Lt. Gov. Dewhurst are also on board with this idea, which will be sponsored by Rep. Mike Krusee (R, Round Rock). Some of this money also goes into school funding, which is no doubt part of the reason for their support.

Posted by Charles Kuffner on February 16, 2005 to Planes, Trains, and Automobiles | TrackBack