In The News

Could a fuel tax hike be headed to a statehouse near you?

     
The days of state lawmakers being unwilling to support a fuel tax increase to pay for needed transportation projects could soon be history. Officials in multiple states are deciding whether to wade into territory that has been unchartered for several years.

In Maryland, leading officials are talking about taking the plunge during the upcoming legislative session. Gov. Martin O’Malley recently said there would be more money available for cities and towns throughout the state to make road improvements if the fuel tax rates are increased.

The state’s fuel tax rates have remained unchanged for 20 years. The tax rate for diesel has since held at 24.25 cents per gallon, and the tax for gas has been 23.5 cents per gallon.

In the years since, supporters of an increase point out that construction and maintenance costs have skyrocketed at the same time that vehicles have become more fuel efficient. Also, fewer dollars are expected to be made available for states from the federal government.

O’Malley said a one-time hike in the fuel tax rates likely will not be enough to solve the funding problem. Instead, he supports indexing the tax rates to inflation.

Senate President Thomas V. Mike Miller, D-Calvert, pushed a fuel tax increase during the 2011 regular session. The proposed 10-cent increase was met with stiff opposition.

Miller has indicated that he will once again take up pursuit of a transportation revenue package when the 2012 session convenes. It is expected to include a fuel tax hike.

Elsewhere, possible increases in state fuel tax rates are drawing attention.

In Iowa, the governor’s Citizen Advisory Commission voted unanimously to endorse a proposal to increase the state’s fuel tax rate by 8 to 10 cents per gallon. Gov. Terry Branstad has since indicated that he will not support such a move during the upcoming session.

Instead, he is looking for cost savings.

Talk about a tax increase in Tennessee also appears to be premature. Gov. Bill Haslam said declining fuel tax revenues will end up causing the state a lot of problems down the road. However, he said current economic conditions warrant taking no action at this time.

To view other legislative activities of interest for Maryland, click here .

Editor’s Note: Please share your thoughts with us about the story topic. Comments may be sent to [email protected] .

www.LandLineMag.com