February 17, 2015[Madison, Wisc…] In Gov. Scott Walker’s budget, which was introduced in early February, he proposed a plan to use $1.3 billion in bonding authority to pay for Wisconsin’s transportation needs. While the budget bonds less than previous budgets in total, the bonding used for transportation would be a 30 percent increase over the previous biennium.
In lieu of bonding, some legislators have suggested finding revenue in other areas, along with decreases in spending. Assembly Majority Leader Jim Steineke (R-Vandenbroek) said in a recent editorial that lawmakers could consider a small gas tax increase.
“There are many funding sources that have been discussed to stabilize the transportation fund for the future,” Steineke wrote. “The Wisconsin Transportation Finance and Policy Commission has suggested funding alternatives such as raising the state gas tax by 5 cents per gallon and creating a new mileage-based registration fee for passenger vehicles.”
“While I will always have reservations with any attempt to raise taxes or fees on Wisconsin residents, I believe that all options should be debated and analyzed during the upcoming months as the budget process continues,” he continued.
But, seemingly in response, Senate Majority Leader Scott Fitzgerald (R-Juneau) released a column saying that any gas tax increase would be a nonstarter in the Senate.
Fitzgerald authored the column below:
Earlier this month, Governor Walker introduced his proposed Biennial Budget for the State of Wisconsin. Though we are still in the early stages of reviewing the specifics of the proposal, it is clear that one of the largest challenges of this budget process will be meeting the state’s transportation funding needs.
Wisconsin is experiencing the same trend that has hit most other states across the nation–and in fact the national Highway Trust Fund; as motor vehicles have become more fuel efficient over recent decades, revenues from gas tax levies at the state and federal level have diminished while demand for projects to construct, repair, and maintain roads has continued to grow.
Meanwhile, with a recent drop in fuel costs that has resulted in the lowest price at the pump in years, some within Wisconsin have begun looking to an increase in the state gas tax–currently set at 30.9 cents per gallon–as a tool to better manage the state’s transportation funding needs.
Any proposed increase in Wisconsin’s gas tax–already the 12th highest in the nation–will be a terrible blow to Wisconsin’s middle class families, and a nonstarter in the State Senate. According to the US Energy Department, the typical U.S. household buys about 1,200 gallons of gas each year. That translates to over $1,000 in savings annually if gas prices remain near their current rate: savings that would be eaten into significantly with a new per-gallon hike on fuel costs.
Those that are enjoying the most benefit from the current low are also the ones who would be hurt the most by a tax increase: the middle class families for whom gas related expenses are not a luxury. If these families are forced to spend more commuting to work or driving their children to school, they will have to make difficult cuts in other areas of their personal budgets.
While an increase in the state gas tax may appear to be an attractive way to fill a hole in the budget, it is a shortsighted solution that will be an immediate hit to Wisconsin’s families and a long term drag on Wisconsin’s economy. As consumers are forced to spend more on fuel, they have less to invest back into the state. And small businesses–who have already been able to increase inventory, lower prices, and invest in improvements as the result of current fuel savings–will be some of the hardest hit by a new tax.
Currently, over 15% of Wisconsin’s transportation budget goes to non-infrastructure spending. Instead of increasing the tax burden on Wisconsin’s working families and raising costs for small businesses, we in the legislature need to examine how we can make changes on the other side of the equation to eliminate budget waste and decrease the costs of publicly funded projects. As elected representatives, we have a duty to the taxpayers to address any policy that artificially increases the financial burden on Wisconsin’s taxpayers–not to make that burden heavier. An increase in Wisconsin’s gas tax simply has no traction in the State Senate.