States Look Ahead For Road Funding Options

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DALLAS -- Lawmakers in at least eight states next year will contend with measures to increase funding for transportation projects, the Transportation Investment Advocacy Center said in a new report.

Legislative proposals range from increases in state gasoline taxes to new bonding capacity, said Carolyn Kramer, manager of the center operated by the American Road and Transportation Builders Association.

"In the past three years, 16 states have increased taxes on motor fuels in order to generate new transportation revenue," she said. "Despite the challenges of increasing taxes during an election year, that number is likely to grow as several states have already begun discussing proposals for the 2016 legislative session."

States in the revenue hunt include Alabama, California, Indiana, Minnesota, Missouri, New Jersey, South Carolina, and Tennessee, said Kramer.

In Alabama, Gov. Robert Bentley said he would support an increase in the state gasoline tax next year after a similar proposal failed during the 2015 Legislature.

The Alabama House approved a bill in August that would have added 5 cents to the state's current gasoline tax of 21 cents per gallon, but the Senate rejected the measure. The increase would have generated an additional $70 million for highways in fiscal 2016.

"I do think the gasoline tax is one tax that will certainly be strongly looked at," Bentley said last month. "It will come up in the next session and there is a reasonably good chance it will pass. I'm for it."

Small increases in Missouri's fuel taxes proposed by the chairman of the state Senate's transportation and infrastructure committee would provide the match that the state needs to obtain its full allotment of federal highway funds, said Gov. Jay Nixon.

"It doesn't solve the whole problem but it's clearly a step in the right direction," Nixon said last week of a proposal (Senate Bill 432) to raise Missouri's gasoline tax by 1.5 cents per gallon and the diesel tax by 3.5 cents. Both fuels are currently taxed at 17 cents per gallon.

If approved by the 2016 Legislature, the new tax rates would go into effect Oct. 1 and would generate an additional $85 million per year.

Indiana Republican lawmakers have proposed a plan to link the state's gasoline tax of 18 cents per gallon to inflation in construction costs since 2002. House Speaker Brian Bosma said that would result in a tax increase of 5 cents per gallon.

The legislation sponsored by state Rep. Ed Soliday, chairman of the House Roads and Transportation Committee, would also direct highway officials to determine the feasibility of levying tolls on Interstate 65 and I-70. Soliday said tolling the interstates could generate up to $365 million per year of new revenue.

Voters could have the final say in November on transportation measures in Colorado and Washington state. Twenty-six of the 37 state and local road and transit proposals up for a vote in November 2015 were successful, Kramer said.

A Colorado business group is asking state lawmakers to put a $3.5 billion transportation bond proposal on the ballot in November 2016. The debt would be supported in part with $83 million per year of general revenues to reduce the reliance on the gasoline tax to fund major road projects.

Seattle's Central Puget Sound Regional Transit Authority will ask voters next November for up to $15 billion to fund a significant expansion of its light-rail system. A 16-year, $16 billion transportation package adopted by state lawmakers earlier this year authorized Sound Transit to seek a 0.5% sales tax and a property tax of up to 2.5 cents per $100 of assessed value for the expansion project.

 

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