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Governor Says ‘Yes’ to Dime Gas Tax Increase, Then Tries to Clarify

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DES MOINES, Iowa–Monday morning, Iowa Governor Terry Branstad gave his strongest support yet to increasing the fuel tax. But moments later, he nuanced that support.

When asked by a reporter, “If the house and senate both vote on the bills the way they are, would you sign it?” Branstad responded, “Yes.”

The house and senate are looking at identical bills that would raise the current fuel tax a dime per gallon.

But in a later reply in his weekly news conference, Branstad phrased his words differently. He said, “What I’m saying is what I do support is providing additional funding for the road use tax fund. And we’ve been working in conjunction with the house and senate to get it,” Branstad said.

He added, “I never make a final decision on bills until I receive them.”

Lawmakers have discussed raising the state’s fuel tax from its current 21 cents per gallon level. That could provide $215 million per year for the state’s crumbling infrastructure. Although, state experts figure that will decline in future years as vehicles continue to become more fuel-efficient.

Groups like the Americans for Prosperity are pushing hard against the idea, saying while the state’s roads and bridges need more financial assistance, lawmakers should use money from existing funds, rather than raise taxes.

 

23 comments

  • Ski

    WHY do neighbor states sell gas for 15 cents or so LESS than in Iowa? Don’t they have gas taxes? Or are they just more efficient in the way they spend tax money?

  • John Smith

    To my way of thinking, every citizen benefits from roads and bridges, whether they drive or not. Much of our economy would simply vanish without them.

    Therefore, I would agree with those who advocate infrastructure spending from general revenues, rather than any sort of special use taxes. If that means raising the money from income taxes, well, at least the income tax is a bit less regressive.

    Of course, as we see from the Koch AFP, raising any taxes at all is against their religious beliefs. So, politicians have a hard time doing so, even if it is for something as basic as good roads or clean water. Much easier to keep teenagers out of tanning beds or letting 19 year-olds into bars.

    I must say, though, that I find any member of the press thinking he will get a straight answer from the Governor quite hilarious indeed.

    • marcopolish

      The better solution is to take a half-cent or so in state sales tax, with a strong earmarking and very strong sunsetting rule. Everyone benefits from anything transported using gasoline, and that’s more fair. Under the proposed fuel tax, revenue on fuel decreases (and the proportionate burden on those paying the tax increases) with every increase in fleet fuel economy, including new cars replacing old ones, hybrids and electric vehicles. Another fairness phase-in would be to put in tiers linked to fuel prices, such as highest when the price is under $2.50/gallon, next when under 3.00/gal., lower still when 3.50, you get the picture. If fuel purchases reflect economy, then as fewer gallons are purchased, maybe thus fewer miles driven, so too the tax matches the amount of driving. You still get the revenue of out of state passers-through and don’t have to do any fancy calculating or impractical vehicle tracking, and as/when fuel prices are low, people feel more able to live with additional tax.

      Meanwhile, the formula really does need to be changed, it favors mis-spending on things that are not infrastructure improvements, allows mis-spending on roads that don’t need attention while neglecting those that do, doesn’t balance well between rural and town, and promotes forced spending on boondoggles from the feds,

      • John Smith

        Regarding your last paragraph, I would be perfectly OK with the whole thing being scrapped, and a new funding method developed. Earlier, the Governor floated the idea of charging more to register EVs and Hybrids because they use less petroleum, exactly the wrong idea, IMO. If the politicians can’t see their way clear to charge by vehicle weight (including pick-up trucks and other farm vehicles), which actually has some bearing on road life, then I would prefer they chuck to whole thing and start from scratch.

        And, yes, some sort of lock box needs to be in place to keep the infrastructure maintenance funds from being diverted to other uses. No more making it SOP to defer maintenance. That’s how we got here to begin with.

      • Kenny

        Your plan would make it very easy for the DOT to make long range plans wouldn’t it? Let’s see, what will the price of fuel be next week or next year, then try to make a budget for next year’s spending.

  • marcopolish

    That’s our Terry’s leadership style: Check which way the wind is blowing, and if it is blowing much, get out in front of it instead of working. Be ready to change when it does, like with gambling. “I tried to oppose it, but the people over-ruled me so I supported it.” Whenever he says “The time is right” it really means “it was too much work and wouldn’t be popular.”

  • johnston1mom

    they need to put in toll roads at the northern and southern boundaries of I-35 and eastern and western boundaries of I-80 – that would more than take care of the financial burden – raising the gas tax makes absolutely no sense – it won’t fix the problem it will just “stifle it for a while” until they need to go back and raise it again and again

    • marcopolish

      There is a ton of captive traffic on 80 for the regions east and west…that’s why we have such drug problems, such gang problems and more along that route. As for 35, same deal, a ton of traffic from south and north population regions, with again, much problem traffic that goes with the legitimate traffic. The incoming interstates and also the avenue of the saints too, are a captive route to commercial toll traffic that has too long been ignored. Nothing wrong with putting up toll booths at the borders, not a thing.

  • marcopolish

    Yes, it WOULD allow for long range plans; “next year” is not long range. And the bulk of the funding would be projectable, only the last 1-20% would vary around, that’s the tail. Do up a spread sheet some time, it is very possible.

    • Kenny

      How would you be able to predict future fuel prices? Your revenue would be as unstable as the price of fuel. Or would you propose to scrap projects if revenue does not meet the costs of planned projects, whether they are a year out or five years out?

      • marcopolish

        Golly, ever have to balance your salary against your wants and needs? Counter-cyclical savings, just like Keynes said to do. Phased planning with vertical budget (project priority) lines. People in business and government do it every day. Not all of it is unpredictable, just beyond a certain predictable base; beyond that, projects are planned to phase in or delay based on current balances plus a proportion of the projections, which have confidence bands built into them. Have you never had to do a project or plan an operation, or do so in one that is ongoing with many fingers, etc.? You just breaking them into levels of priority of necessary, desirable, and match it to your current balances, not just your projected income; and again, some of that income is always going to be there, just the tail that whips around. So you plan to be within your base and go from there. This is all regular type business math, what don’t you get?

  • RDM

    This, as usual, is just another in a series of Terry B. scams for Iowans. And never be it said again that republicans do not like raising taxes on the middle class. This stunt by Terry B. is simply to get more matching federal funds from their so called hated federal government. Roads will not improve, they never do, and you will not see any new projects like expanded mass transit. All you will see is 10 more cents per gallon at the pump. Thats it! Thats all! Shame on you of you haven’t figured that out by now.

    • marcopolish

      Yes, it is. But it’s not only him, this has been popping around the statehouse from even before this legislative session started, it’s been discussed by both parties at several levels of “yes, this is the time to just do a fast scoop.” Free money is what they were thinking, some for roads, some for pet projects, some for getting some federal funds, and all because they know prices won’t stay down and they have to strike while the iron is hot. Some investor once said “every so often someone just leaves a bag of money in the corner…and of course one should strike fast to just walk over and pick it up.” This one was thought of as a bag of free money just laying around for the taking, as far as this last fall and definitely accelerated this January; now they are pushing because they see those prices marching back up, gotta hurry though, once done, won’t be undone. That’s why you see big downtown groups and other lobbies jumping in with heart wrenching stories of busloads of children crashing down embankments and off of overpasses because we didn’t fix them all in time…to quote a big ad I’ve heard a couple dozen times on advertising spots.

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