It might seem odd for a guy that makes his living by trucking to support an increase to the gas tax. After all, fuel costs are the second highest expense of doing business, after labor, in my industry. I spend quite a bit of time considering the conditions of roads and routes that my trucks will be taking to deliver goods. In addition, I have served on the Transportation Interim Committee for several years, which for the past several interim cycles has heard report after report about the conditions of bridges, shortfalls in transportation funding and particular needs at the local level.
Transportation is the backbone of our economy and every Utahn benefits from a system that effectively and reliably moves good and services. However, this isn’t a system that we just build once and can ignore. Utah’s population is expected to double in the next 35 years, which means more need for roads as an increased number of people, goods, and services are traveling.
The gas tax is our primary funding source for transportation in the state of Utah. The tax is at a fixed rate, 24.5 cents per gallon, which means that as our vehicles have become more fuel efficient, we collect less in revenue. The last time we raised the rate was in 1997. Since that rate increase, construction costs have increased nearly 300% while the purchasing power of the gas tax has declined by 48%. Local governments in particular struggle to meet their transportation needs because their share of the gas tax covers less than half of their actual costs.
We have clearly put off for a very long time considering an increase to the gas tax or other transportation related fees. The State has gotten by with supplementing transportation from the general fund as have locals, but that is just a band-aid and not a real solution. I think it is time we truly consider a change to how we assess and manage this tax and perhaps even consider an increase in the rate. There are a few bills offering different solutions this year. One originating in the Senate offers a straightforward increase in the gas tax from 24.5 cents to 34.5 cents to make up the lost purchasing power. The other proposal originating in the House would change the cents per gallon tax to a percentage based tax with floors and ceiling to ensure the rate wouldn’t spike or drop. This approach means that the collection of funds will rise with the price of fuel rather than consumption.
I think both proposals have merit, but the more important thing in my mind is that we don’t allow another year to pass without addressing the problem. We know we have a funding problem and to not find a solution is irresponsible public policy.