Delegate pushes for higher gas tax

Delegate pushes for higher gas tax
Charleston Daily Mail, April 15, 2009
CHARLESTON, W.Va. Motorists could save a little at the gas pump if the wholesale gas tax rate drops, but they'll wind up paying more for auto repairs if there's less revenue to maintain roads, officials say.
"We can paint a lot of different scenarios about what could happen and what's likely to happen," Danny Ellis, business manager for the state Division of Highways, said Tuesday. "If you don't have funding to keep your roads repaired, those types of things can happen, tires being blown out, I guess, front end alignments, when your roads are in disrepair.
"If you lose your revenue, you're going to wind up making cuts in your program, it's that simple."
During the regular session that ended Saturday, lawmakers considered a bill to freeze the wholesale gas tax at its current level of 32.2 cents. The bill died in the House Finance Committee. Motorists who fill up in West Virginia pay more in state taxes than they do in the neighboring states of Kentucky (22.5 cents), Maryland (23.5 cents), Ohio (28 cents), Pennsylvania (31.2 cents) and Virginia (18.1 cents). The federal tax is 18.4 cents a gallon.
Delegate John Doyle, D-Jefferson, hopes lawmakers reconsider the gas tax issue when they meet in May for an extended session to consider the budget. "Our failure to act would be the Auto Repair Dealers Full Employment Act of 2009," Doyle said. "Instead of paying another 3 to 5 cents in wholesale gasoline taxes, they'd be paying an additional several hundred dollars a year to have their shocks repaired and front end realigned and all that stuff."
The wholesale gas tax is calculated each year. It is based on wholesale fuel costs from July 1 to Sept. 30. The new rate takes effect on Jan. 1. West Virginia's gasoline tax is expected to drop 3 cents to 5 cents a gallon, which Ellis said could mean $42 million to $70 million less to pay for highway maintenance and paving. The department would continue to do pothole patching to the best of its ability, Ellis added.
But Jan Vineyard, executive director of the West Virginia Oil Marketers and Grocers Association, said there is no predicting what the gas tax rate will be. The average retail price for a gallon of gas in West Virginia on Monday was $2.08, according to GasBuddy.com. It was $3.43 on April 13, 2008. "There's a lot of things that can happen between now and October," Vineyard said. That includes the storm season, as well as a turnaround season for refineries. That occurs after the summer driving season when refineries focus on repair work at the expense of production. "It's hard to predict what that tax is actually going to be," Vineyard said.
The state was projected to receive about $380 million from the motor fuel tax for the current fiscal year that ends June 30, Ellis said.
DOH has budgeted about $309 million for this fiscal year for state and local highway maintenance in all 55 counties, Ellis said. Other funding would go toward bridges and new equipment purchases and to helping pay off a $50 million debt from bonds sold back in 1998 for various road construction projects. The debt is supposed to be paid off by 2025.
West Virginia also will receive about $400 million for interstate highway work from the federal government, but the state must put up 20 percent in matching funds, Ellis said.
Legislators will reconvene May 26 to discuss the budget, supplemental appropriations, veto overrides and federal stimulus money from the American Recovery and Reinvestment Act. "There is a great reluctance at this point to reopen on a broad scale any of those issues that didn't pass," House Minority Leader Tim Armstead, R-Kanawha, said.
Armstead echoed Vineyard's point that it was still unclear what next year's gas tax rate would be. "We're still operating in the dark," Armstead said. "We really don't know what the impact of that bill would be."
"People are just having a hard time making ends meet right now," Armstead added.
House Speaker Rick Thompson, D-Wayne, earlier voiced support for the House Finance Committee not taking up the Senate-passed gas tax bill. He cited last year's high gas prices, this year's problems on Wall Street and the current economic downturn.
"We need to give consumers a break in dealing with this crisis and we're doing so in a responsible way," Thompson said in a news release. "While we know that our transportation and infrastructure systems need attention, those sectors will realize $210 million in federal stimulus money this year."
Doyle contends a gas tax drop will to some degree negate the positive effect of the stimulus money. "Basically we'd be taking $70 million away from that," Doyle said.