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Task force recommends tax increases to fuel state transportation needs

By: Jim Erickson


Now what?

That’s the operative question in the wake of a report issued early this month by the 21st Century Missouri Transportation System Task Force.

The fact that 2018 is an election year seems likely to boost the odds many legislators in Jefferson City will head for cover when the third rail of Missouri politics – tax increases – enters the conversation. Meaning the study’s conclusions could be kicked down the road for someone else to worry about.

With the task force’s primary recommendation being 10- and 12-cent increases in the state’s gasoline and diesel fuel tax, respectively, the discussion reaches that point quickly.

Sen. Dave Schatz [R-Sullivan], vice chairman of the task force, represents a district that includes the Wildwood and Chesterfield areas. In an interview with West Newsmagazine, he spoke candidly about the group’s report and was guardedly optimistic about what’s ahead.

“Obviously, the task force didn’t come up with any new revelations about what the state faces and how to deal with those challenges. At the end of the day, it wasn’t like we were going to find a brand new approach.

“But we did receive good input from a number of different sources throughout the state and I think Kevin [Rep. Kevin Corlew, the Kansas City area Republican who chaired the task force] did a great job of putting the report together.

“Our priority now is communicating the needs of our transportation infrastructure to the general public and I believe we can do that,” Schatz continued. “No doubt we will need to convince those who may not see major problems in their particular area and may conclude the [transportation] issue doesn’t affect them personally.”

The report emphasizes transportation’s broad impact and importance.

“Our statewide system connects Missouri’s people with every vital part of their lives: family, jobs, services and amenities,” the report states. “Manufacturers and farmers alike rely on the transportation system to get their products to market.

“In short, a safe, convenient, efficient and reliable transportation system is vital to a prospering economy,” the document concludes.

Work on the Daniel Boone Bridge, the last such project to be funded under the 2011-2015 State Transportation Improvement Program plan. [MoDOT photo]

Here and now

Although the state’s transportation infrastructure needs have been widely reported, the task force emphasizes them again:

  • Missouri’s aging system includes nearly 34,000 miles of roadway [the seventh largest total in the nation] and some 10,394 bridges [sixth highest nationally].
  • The oldest stretches of the interstate highway system in the state were built in the 1950s with a 20-year life expectancy and a large percentage of state-maintained bridges are beyond their 50-year design lives.
  • The American Society of Civil Engineers has given the state a grade of C-minus for its overall infrastructure.
  • Illustrating the need for highway safety in addition to infrastructure improvements, Missouri ranks last among the 50 states and the District of Columbia in preventable accidents. The National Safety Council lists driver inattention as the leading cause of traffic mishaps in the Show-Me State.

Accordingly, the task force recommends a three-part strategy that includes improved highway safety, innovation and more efficient project delivery, as well as the immediate first step of greater investment by increasing motor fuel taxes. More sustainable and diversified transportation funding for the future also is needed.

Missouri’s motor fuel tax is 17 cents per gallon, the fourth lowest in the nation. Compared with the large number of roadway miles that are the state’s responsibility, the revenue raised per mile is the 47th lowest nationally.

Since the current motor fuel levies became effective in 1996, inflation has eroded their purchasing power to eight cents today. The longer-term viability of that revenue source for funding the state’s transportation needs also has become problematic due to the trend toward more fuel-efficient vehicles, including those driven by electricity and alternative fuels.

St. Charles County Executive Steve Ehlmann noted that during the decade from 2006-2016, the county’s share of gas taxes dropped from $4.43 million to $3.94 million despite significant growth in the area’s population.

As set forth in the state constitution, 70 percent of the revenue generated to support roads and bridges goes to the state, while cities and counties each receive 15 percent.

The recommended increases of 10 cents on gasoline and 12 cents on diesel fuel will serve only to restore the buying power that 17 cents provided in 1996, the report says.

During public hearings held by the task force, citizens and civic and business leaders repeatedly recommended increases in motor fuel taxes as the best short-term solution. Another part of the immediate impact investment would earmark $50 million to $70 million annually for the state’s multimodal transportation needs, including aviation, mass transit, railroads, ports and waterways, and transportation for individuals who are elderly or disabled.

Taxes on compressed natural gas may help alleviate future transportation funding needs.

Future funding

As for sustainable and diversified funding for the future, the task force recommends the General Assembly consider a range of alternatives such as increased registration for electric vehicles, excise fees or taxes on electric charging stations, and higher non-fuel user fees on driver’s licenses and vehicle registration, which haven’t been adjusted in decades.

Indexing all highway-user fees to account for inflation and mileage-based, road-user charges also are possibilities, along with tolling on major bridges, authorizing local construction excise taxes and dedicating a portion of sales tax revenue from internet purchases for transportation needs.

The task force’s third step to achieve more efficient project delivery, improved highway safety and innovation includes a potpourri of ideas. On the safety front, the task force recommends legislation prohibiting distracted driving, especially texting; requiring seat belts and enforcing that mandate as a primary offense; and more graduated driver’s license training requirements for young drivers.

In addition, public-private partnerships could lead to greater economies and efficiency on major projects, the report says. Also, legislators should examine opportunities to leverage innovation in transportation to help grow the state’s economic competitive advance and improve the quality of life.

Schatz already has sponsored a bill [S.B. 734] calling for 10-cents per gallon increases in both gasoline and diesel fuel taxes but said he is open to a slightly higher levy on diesel, as recommended by the task force. The measure also sets tax rates on compressed and liquefied natural gas, aviation gasoline and propane.

Rep. Derek Grier, whose 100th House District includes parts of Chesterfield, Ballwin, Town & Country and Winchester, said he believes the task force did a good job and raised a number of sound recommendations.

However, Grier said any tax increases should be “revenue neutral,” that is, they should be offset by cuts elsewhere. Grier conceded he has no immediate suggestions on where such decreases should be made but noted he still is studying the report.

Ehlmann said his only comment on the task force report was simply, “We need more funding.”

According to Schatz, the motor fuel tax ball is in the legislature’s court but other possibilities also are being discussed. Among other things, the idea of removing from transportation funds the Missouri State Highway Patrol’s expenditures for administering and enforcing the state’s motor vehicle laws is being considered. The MSHP would be funded instead through a sales tax increase.

Such a step would free up some $270 million to $300 million dollars for transportation, Schatz estimated.

Various interest groups also are considering other possible proposals, Schatz said.

While voters in St. Louis City and County have approved sales tax increases to provide more funds for law enforcement, a 2014 statewide proposal for a ¾-cent boost in the sales levy for roads and bridges was soundly defeated.

Schatz has little doubt that election-year politics will have an impact on any proposal to increase taxes, including the hikes the task force has recommended.

“We’ll just have to see if the House has any appetite at all for a tax increase,” he said.

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