Is 2015 the Year California Increases its Gas Tax?

The stars appear to be aligning for a 10-cent gas tax hike, thanks to a $59 billion backlog in bridge and road repairs that has even influenced anti-tax Republicans. It's been 20 years since the gas tax was increased.

3 minute read

May 28, 2015, 7:00 AM PDT

By Irvin Dawid

"For the first time in decades, even anti-tax Republicans are open to raising prices at the pump to start cutting into the state's $59 billion backlog of roadway maintenance," writes Jessica Calefati, San Jose Mercury News reporter based in Sacramento. "[Gov. Jerry] Brown had telegraphed his intention to take up the issue in his January inaugural address when he asked Democrats and Republicans to do the 'impossible' and craft an agreement to improve transportation infrastructure."

Over the past decade, the state has used most of its transportation funding on widening roadways -- But that left little to tackle potholes and other routine repairs.

SB 16 by Sen. Jim Beall (D-San Jose) would raise the gas tax by 10-cents and the diesel tax by 12 cents. With additional fees (see bulleted list in April 20 post), including a new, annual electric vehicle registration fee of $100 to ensure that these vehicles pay for road upkeep, it would raise $3 billion annually to meet Gov. Brown's infrastructure goal of maintaining and rehabilitating the state's network of roadways, highways and bridges

"This is an urgent crisis that we have to deal with now," said Beall, chairman of the Senate Transportation Committee. "If we don't, we're leaving the next generation an astoundingly expensive problem."

"Current gas tax revenue covers only a quarter of the state's annual highway repair needs," writes Calefati. "And the gas tax -- now the second highest in the nation [47.58 cents per gallon as of April 1 per API [PDF], after Pennsylvania -- is set to go down 6 cents in July."

Hiking the gas tax has always been politically risky, especially in a state where cars are still king and that gave birth to the anti-tax revolution in the late '70s.

To reach the governor's desk, Beall's plan must win approval from two-thirds of lawmakers in both the Assembly and the Senate. He'll need GOP support now that the Democrats have lost their supermajorities in both houses.

A coalition of anti-tax Republicans who oppose the bill will likely form this summer, but so far Beall's bill has been through two [Senate] committees and it's drawn only two "no" votes from Republicans, although many have abstained.

Update: On May 26, a third Senate committee, Appropriations, voted 7-0 to send the bill to the "suspense file" ["A bill or set of bills, with a fiscal impact, set aside in Appropriations Committee by a majority of Members present and voting. These bills may be heard at a later hearing." Cited from legislative glossary.]

Correspondent's notes: See prior post on SB 16 that describes the neutral "gas tax swap" that raised the excise tax on gasoline by 17.3-cents on July 1, 2010 while eliminating the six percent statewide sales tax on gasoline.

Hat tip: MTC Headlines

Sunday, May 24, 2015 in San Jose Mercury News

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