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The Utah Senate on Thursday endorsed raising the state's gasoline tax by 10 cents a gallon — and hinted that it might add, before final passage, provisions to make the tax rise automatically with inflation.
House leaders, however, oppose such a hike. They instead want to convert the cents-per-gallon tax to something more like a sales tax — imposing a percentage tax on the price of gasoline. Revenue could rise much more rapidly with prices under that proposal, but still allow lawmakers to claim they did not initially hike taxes. "We don't want to hide a change. We want to be very transparent" in the Senate, said Sen. Kevin Van Tassell, R-Vernal, sponsor of SB160, which passed 19-6 in a preliminary vote.
Sen. Lyle Hillyard, R-Logan, also said the House's alternative would hit rural areas extra hard because gas prices are higher there — so a gas sales tax would cost them more. He said a cents-per-gallon tax treats all areas equally.
Van Tassell said his proposed tax hike would cost an average driver about $48 a year.
The state's 24.5 cents per gallon gas tax has not been raised since 1997. It has lost 12 cents a gallon in buying power since then, Van Tassell said, and the 10-cent hike would restore only part of that.
A funding crunch has led the Utah Department of Transportation to do such things as halt regular maintenance on lesser-used rural highways.
Van Tassell said a tax hike is overdue and needed to take care of deferred maintenance and help cover a projected $11.3 billion shortfall in priority road and transit projects planned through 2040.
The bill, which also includes a 5-cent-a-gallon increase for diesel, would generate an estimated $130 million a year. Van Tassell's bill would earmark $40 million annually to restore full maintenance of lesser-used rural highways.
"No one likes a tax increase and I don't want to pay a penny more at the pump," said Sen. Todd Weiler, R-Woods Cross. But he supported this increase because it has been so long since the last one.
Under questioning, Van Tassell said he is exploring making the tax rise automatically with inflation — and is trying to worth that out with concerned groups.
Senate Majority Leader Ralph Okerlund, R-Monroe, liked that idea to avoid again putting "ourselves in the position that we are going to lose some roads" before extra money becomes available.