Gas Tax 'Swap' Results In More Potholes In California Cities

The annual budget for Paso Robles' road maintenance fund went from $400,000 to $38,000 after Gov. Schwarzenegger and the legislature agreed in 2010 to a complicated gas tax maneuver dubbed the "fuel tax swap" to balance the budget.

2 minute read

May 26, 2012, 7:00 AM PDT

By Irvin Dawid


Tonya Strickland investigates why the roads in the small, central coast town of Paso Robles in San Luis Obispo County are falling into disrepair. Public Works Director Doug Monn reveals how an arcane budget maneuver had dire effects on the condition of his town's roads.

According to Monn, "Former Gov. Arnold Schwarzenegger all but obliterated Paso Robles' road maintenance budget in 2010 with his decision to borrow most of the sales tax revenue that all cities got from gasoline sales to help fill the state's deficit.

"The state Legislature doesn't make it clear how or when cities will get that revenue back, Monn added."

The 2010 gas tax swap, a complicated budget maneuver that initially eliminated the state sales tax on fuel for an equal increase in the state fuel excise tax (thus the equal 'swap' as there was no revenue increase) helped the legislature to balance the budget that year. However, the law ran into conflicts with two voter initiatives, Propositions 22 and 26, and the legislature fixed the swap measure in 2011.

[See the Board of Equalization's FAQ for everything you want to know on the swap.].

"The gas tax change dropped Paso Robles' road fund from nearly $400,000 a year for fresh coats and seals to a mere $38,000 annual share from the city's general fund, and that figure fluctuates depending on the year."

A half-cent, local sales tax increase on the November ballot may bring relief.

"Like other California counties and cities, Paso Robles receives 1 percent of the 7.25 percent sales tax that local shoppers see on their receipts. Since the new revenue would go to specific purposes rather than general uses, the increase would require two-thirds voter approval under state law. The City Council identified roads and police as its key recovery areas."

Thanks to Thomas A. Rubin

Friday, May 18, 2012 in The (San Luis Obispo) Tribune

Chicago Intercity Rail

Amtrak Ramping Up Infrastructure Projects

Thanks to federal funding from the 2021 infrastructure act, the agency plans to triple its investment in infrastructure improvements and new routes in the next two years.

September 25, 2023 - Smart Cities Dive

Google maps street view of San Francisco alleyway.

Ending Downtown San Francisco’s ‘Doom Loop’

A new public space project offers an ambitious vision—so why is the city implementing it at such a small scale?

September 26, 2023 - Fast Company

Google street view of yellow "End Freeway 1/4 mile" sign on 90 freeway in Los Angeles, California.

Proposal Would Transform L.A.’s ‘Freeway to Nowhere’ Into Park, Housing

A never-completed freeway segment could see new life as a mixed-use development with housing, commercial space, and one of the county’s largest parks.

September 26, 2023 - Los Angeles Times

Traffic on the 405 interstate freeway through the Sepulveda Pass at Getty Center Drive in Los Angeles, California

Report: Bike Lanes Can't Make up for New Roads

If California wants to meet its climate goals, the state must stop funding its myriad road construction and expansion projects.

September 29 - Streetsblog California

Late evening view of downtown Minneapolis skyline with stone bridge in foreground

Minneapolis Affordable Housing Project Largest in 20 Years

The city opened its first large multifamily affordable housing complex in decades, but a recent court ruling against the Minneapolis 2040 rezoning plan could jeopardize future projects.

September 29 - Minnesota Public Radio

Close-up of vertical PARK sign on multistory urban parking garage.

NYC Mayor Proposes Eliminating Parking Minimums

Mayor Adams wants to stop requiring off-site parking for new buildings to reduce the costs of construction as part of the ‘City of Yes’ package of zoning reforms.

September 29 - StreetsBlog NYC

Urban Design for Planners 1: Software Tools

This six-course series explores essential urban design concepts using open source software and equips planners with the tools they need to participate fully in the urban design process.

Planning for Universal Design

Learn the tools for implementing Universal Design in planning regulations.